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Business valuation document checklist: what to prepare before hiring a valuation firm.

Most valuation delays happen because the work started before the right records were assembled. The request list changes with the asset, the interest, the date, and the purpose, and so does what “ready to start” means.

This article is valuation commentary. It is not legal, tax, accounting, or investment advice. Specific engagements depend on facts and applicable professional standards.

Why the document package controls the engagement

Most valuation delays, repeat document requests, and avoidable fees happen for one reason: the work started before the right records were assembled. A supportable valuation isn’t “last year’s tax return plus a multiple.” The request list changes with the asset being valued, the ownership interest, the effective date, the purpose, the standard of value, and any agreements that affect transferability. The IRS’s own valuation guidance frames scope this way, and so do the AICPA, ASA, and major practitioner checklists.

Tax returns are important, but they’re rarely enough by themselves. Tax filings are a starting point for normalization, not a substitute for it. Interim financials, debt documents, ownership records, customer concentration, and operational metrics all matter. The smoother the document package, the smoother the engagement and the lower the fee, and the opposite is also true.

The core package most engagements need

Across virtually every business valuation assignment, the recurring core is consistent. Most firms start with the same eight or nine categories. Some items will not exist at every company. That doesn’t always block the work, but complete information improves accuracy, defensibility, and turnaround.

  • Historical financial statements. Three to five years, plus year-to-date current.
  • Business tax returns. Same window. Federal and state.
  • Latest interim financial statements. Through the most recent month-end available.
  • Ownership documents. Cap table, shareholder or operating agreement, bylaws, partnership agreements, recent amendments.
  • Debt schedules and loan agreements. Term loans, revolvers, ABL, mortgages, related-party debt, personal guarantees.
  • Depreciation schedules and fixed-asset listings. With major capex history.
  • Owner and key-management compensation. W-2s, K-1s, perks, family payroll, distributions.
  • Forecasts, budgets, or strategic plans. If they exist.
  • Customer and vendor concentration. Top 10 customers and suppliers with revenue/spend, contract terms, and length of relationship.
  • Material contracts. Employment, non-compete, license, distribution, lease.
  • Prior appraisals, valuations, and financing packages.

When the assignment is tied to a transaction

If the engagement supports a sale, acquisition, partner buyout, ESOP, or fairness opinion, the core package expands. Transaction-related documents become evidence in the valuation, not just background:

  • Letter of intent and term sheet
  • Draft or signed asset or stock purchase agreement
  • Earnout terms and seller financing terms
  • Debt to be assumed or paid at closing
  • Lender diligence package, if applicable
  • Quality-of-earnings analysis, if performed
  • Prior offers or recent ownership-interest transactions

When real estate is involved

Property-rich businesses need more than business financials. If the company owns operating real estate, leases from an affiliate, or holds non-operating property on the balance sheet, the request list expands materially. The IRS real-property valuation guidelines specifically call for:

  • Deeds, plat maps, surveys
  • Property sales history
  • Lease abstracts and full executed leases with all amendments
  • Current rent roll with tenant names, square footage, lease type, and term
  • Historical NOI statements for income-producing properties
  • Vacancy history
  • Property tax bills and assessments
  • Zoning materials and any entitlement documentation
  • Environmental reports, if available
  • Recent property appraisals

This matters most for property-rich LLCs, operating real estate companies, holding entities, hospitality assets, healthcare properties, and special-purpose real estate where business value and real estate value can’t be cleanly separated.

Documents specific to 409A engagements

409A request list
The cap table is the foundation, followed by financing documents and equity-comp materials.
A 409A request list is narrower than a sale or estate engagement in some respects but more specific in others. The cap table is the foundation: every share class, every option grant, every warrant, every SAFE, every convertible note. Financing materials follow: term sheets, certificate amendments, and stock purchase agreements for each round. Equity-comp materials complete the package: stock option plan documents, recent option agreements, and any tender or repurchase activity.
  • Complete cap table as of valuation date
  • Three to five years of financials, plus year-to-date
  • Forward projections with explicit assumptions
  • Corporate charter and bylaws, plus amendments
  • Each round’s financing documents: term sheet, certificate of incorporation amendments, stock purchase agreement
  • Stock option plan and any sub-plans
  • Recent common-stock transactions: tenders, secondaries, repurchases, transfers
  • SAFEs and convertibles, with conversion mechanics
  • Board materials relevant to the valuation date
  • Debt summary: term loans, convertibles, revenue-based financing, ABL lines

Documents specific to estate and gift filings

Tax-driven valuations often require a more formal documentary record because the return instructions themselves ask for it. Form 706 and Form 709 instructions are specific about what has to accompany the filing.

For Form 709 (gifts), adequate disclosure generally requires a description of the transferred property, the donor-donee relationship, and either a qualified appraisal or a detailed description of the method used to determine fair market value. If gift values include discounts for lack of marketability, minority position, fractional real-estate interests, or similar adjustments, an explanation showing the basis and amount of the discounts is required.

For Form 706 (estates), the instructions require executors to explain how reported real-estate values were determined and attach copies of appraisals; attach complete financial and other data for closely held stock, including multi-year balance sheets and earnings information; and, for partnership, LLC, or unincorporated-business interests, attach statements of assets and liabilities at the valuation date and for the prior five years, plus net-earnings statements.

In practical terms, for any valuation that may end up in an estate or gift filing, gather not just the financials but also the trust or transfer documents, prior gift-return materials, capitalization records, discount support, and the exact legal description of the interest being transferred.

Documents specific to litigation and divorce

Litigation-related assignments usually widen the request list. The disputed issues are often narrower and more fact-sensitive, which means more documents need to be available even if not all of them end up in the final report. In divorce work specifically, common additions include:

  • Personal expense substantiation for items run through the business
  • Related-party transactions with documentation of arm’s-length pricing
  • Shareholder and board communications
  • Distribution policy and history
  • Documentation of formula clauses in shareholder or operating agreements
  • Active versus passive appreciation evidence for separate vs marital property questions
  • Prior expert reports from any other engagements
  • Goodwill analysis materials: customer relationship records, key-employee dependency, succession planning

How to organize before the first call

Organization helps twice: it reduces turnaround and improves the quality of questions the valuation team can ask. A practical setup:

  • Folder structure by category: financials, tax returns, legal/ownership, debt, customers and vendors, forecasts, real estate, prior valuations
  • Consistent file names: include date and document type
  • Keep signed documents separate from drafts
  • Include latest interim statements, not just year-end reports
  • Flag missing documents up front rather than waiting for the appraiser to discover gaps
  • Single point of contact for document production, ideally the CFO, controller, or general counsel

Frequently asked

What if some of these documents don’t exist?
Most engagements proceed despite missing items: some businesses do not produce forecasts, some have no formal partnership agreement, and some have not produced interim financials in years. The valuation expert works with what’s available and documents the limitations. Flagging gaps up front lets scoping happen intelligently rather than through repeated follow-up requests.
Will sharing this much information create exposure if the matter goes adversarial later?
For litigation-prone engagements, work-product privilege typically attaches to materials prepared at the direction of counsel for litigation purposes. Counsel handles privilege questions; the valuation expert works within whatever framework counsel sets. For non-litigation engagements (estate, 409A, financial reporting), the documents are generally produced under engagement letter confidentiality.
How current does “current” need to be?
For most engagements, financial statements through the most recent quarter-end (or month-end if monthly statements are produced) are typical. The valuation date determines what “current” means: a December 31 valuation date wants statements through that date; a date-of-death valuation wants statements as close to the death date as possible.
Do we need audited financials, or are reviewed/compiled enough?
Audited statements are preferred for most formal valuations, particularly anything that may face IRS examination, audit review, or court scrutiny. Reviewed or compiled statements are acceptable for many engagements but may require additional analytical procedures from the valuation expert.
Should I send everything at once, or wait for specific requests?
Most firms prefer an organized core package up front, with specific follow-up requests after initial review. Sending unstructured email attachments delays the engagement. A well-organized data room (Box, Dropbox, ShareFile, or similar) with the categories above usually gets the work moving faster.
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If you have the core records assembled, scoping a valuation engagement usually takes one or two short calls. Send what you have, even if it is partial, and we will come back with a written engagement scope and fee estimate, plus a candid list of anything missing.
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