Document Checklist for Business Valuation

A thorough business valuation requires comprehensive financial and operational documentation. The core documents typically needed include: three to five years of historical financial statements (income statements, balance sheets, and cash flow statements), federal tax returns for the same period, interim financial statements for the current year, accounts receivable and payable aging schedules, fixed asset schedules, and any projections or budgets prepared by management.

Corporate and Legal Documents

In addition to financial records, valuators need: articles of incorporation or organization, bylaws or operating agreements, shareholder agreements and buy-sell agreements, any outstanding notes payable or debt agreements, lease agreements for real property and equipment, employment agreements and non-compete covenants, and any pending or threatened litigation documentation. These documents help establish the legal structure, obligations, and risk profile of the business.

Operational and Industry Information

The valuator also needs to understand the business operations: a description of products and services, customer and revenue concentration data, organizational charts and key personnel information, information about competitors and market position, any proprietary technology or intellectual property, licenses and regulatory approvals, and insurance policies. Industry reports and market data are typically gathered independently by the valuation firm.

Special Purpose Documents

Depending on the purpose of the valuation, additional documents may be required. For estate and gift tax valuations: prior gift tax returns and any existing appraisals. For divorce valuations: personal financial statements of the owner and any prenuptial agreements. For ESOP valuations: the plan document, trust agreement, and prior annual valuations. For litigation: all relevant pleadings, discovery materials, and opposing expert reports.

How CVI Handles Document Collection

Corporate Valuations Inc. provides clients with a customized document request list tailored to their specific engagement. Our team works directly with clients and their advisors (CPAs, attorneys) to gather the necessary information efficiently. We understand that assembling these documents can be time-consuming, and we prioritize the most critical items to begin our analysis while awaiting remaining materials. Our 40+ years of experience means we know exactly what’s needed and can adapt to situations where certain documents are unavailable.

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