Value is assessed at a date. Which one?

Three dates can appear in one engagement

For example, a report prepared in September may assess value as at the preceding 30 June using financial information for several periods. Its later signature does not automatically turn the conclusion into a September valuation.

The purpose helps determine the required date

A proposed sale, a shareholder exit and a historical transaction can require different dates. An agreement, adviser instruction or relevant event may prescribe the date. Do not assume that the latest financial year-end or today’s date is suitable simply because it is convenient.

If the date is uncertain, raise it at the first conversation. A valuer can explain the information implications, while your legal or tax adviser should clarify any requirement arising from the underlying matter. Reworking a completed analysis for another date can require more than updating a balance sheet.

A historical valuation requires historical context

For an earlier date, assemble the records and circumstances that existed then. Identify contracts in place, trading information available, forecasts prepared at the time and any material events around that period. Preserve document dates and versions so their timing is clear.

Later information needs careful handling. It may help test or explain conditions at the valuation date, but it should not automatically import hindsight about events that were not then knowable. The report should explain the treatment of later evidence and any limitations arising from missing records.

What if the business changes before the report is delivered?

Tell the valuer about material events, including a major customer departure, a new contract, financing changes or an acquisition. Their treatment depends on when they occurred, what was known at the relevant date and the valuation basis. Disclosure is useful even when the event does not change the original date’s conclusion.

A signed report is not a permanent certificate of value. If its intended use changes or a significant period passes, ask whether an update or new engagement is needed. The relevant recipient may also have its own requirements about timing and scope.

• State the proposed date and why it is required.
• Provide financial records covering the periods around it.
• Identify significant events and when they became known.
• Keep contemporaneous forecasts separate from later reconstructions.

General educational information. Examples are hypothetical and do not value a real business. The appropriate treatment depends on the purpose, evidence and agreed scope.