For a business valuation you usually need profit and loss statements and balance sheets for the last two or three years, the latest tax return, year-to-date figures, an asset list, leases, a list of debts, and notes on owner pay and one-off items. Complete records make the valuation faster and better supported.
What documents does a business valuation need?
Most valuations start with the last two or three years of financial statements and the latest tax return. Then the valuer needs records that explain the numbers: assets, leases, debts, owner pay and anything unusual.
Here is a practical checklist.
| Document | Why it matters |
|---|---|
| Profit and loss statements, last 2 to 3 years | Shows revenue, costs and profit, and whether they are rising or falling |
| Balance sheets, same years | Shows assets, debts and working capital at each year end |
| Latest business tax return | Cross-checks the financial statements |
| Year-to-date management accounts | Shows current trading if the year is well advanced |
| Asset list or depreciation schedule | Shows what equipment, vehicles and fit-out the business owns |
| Leases | Shows rent, term and options, which affect risk |
| Loans and other debts | Needed to move from business value to the value of the shares |
| Owner pay and benefits | Lets the valuer adjust to a market cost for the owner's role |
| One-off or unusual items | Lets the valuer separate a single event from normal trading |
| Related-party arrangements | Shows deals with owners or family that may not be at market rates |
Why are financial statements the starting point?
Financial statements show what the business has actually earned. Most valuation methods start from earnings, so these come first.
A profit and loss statement shows income and expenses. A balance sheet shows what the business owns and owes on a set date. Two or three years together show the trend, which matters more than any single year.
If the financial year is well advanced, year-to-date figures (management accounts, meaning the internal reports from your bookkeeping system) show how the business is trading now.
Why does the valuer want the tax return?
The tax return is a cross-check. If it tells a different story from the financial statements, the valuer needs to know why.
Your accountant or tax adviser can explain any differences. The valuer does not give tax advice, but needs to understand which numbers to rely on.
What about assets, leases and debts?
These explain what sits behind the profit. They change both the risk and the step from business value to share value.
- Assets. An asset list or depreciation schedule shows what the business owns. Equipment that is near the end of its life may need replacing soon.
- Leases. A lease with little time left, or no option to renew, can be a risk for a business that depends on its location.
- Debts. Loans, equipment finance and money owed to owners affect what the shares are worth. See enterprise value vs equity value for why.
Why do owner pay and one-off items matter?
They are the most common reasons reported profit differs from the profit a buyer would see. Explaining them early saves time.
Owner pay. If you pay yourself well below what it would cost to hire a manager, reported profit looks higher than it really is. If you pay yourself well above it, profit looks lower. The valuer adjusts to a market cost for the work you do. SDE vs EBITDA explains the two common ways of measuring earnings.
One-off items. For example, a hypothetical plumbing business has an insurance payout in one year and a large legal bill in another. Neither is likely to recur, so the valuer considers adjusting for both. Each adjustment needs an explanation and, where possible, a record.
Related-party arrangements. Rent paid to an owner's family trust, or a family member on the payroll, may not be at market rates. The valuer needs to know so the earnings reflect a normal arm's-length cost.
What other information helps?
Short written answers about how the business runs help the valuer understand the risk. Useful topics include:
- your main customers and how much of revenue the largest ones make up
- key staff and whether the business depends on you personally
- contracts with customers or suppliers, and when they end
- any planned changes, such as a new site or a lost contract
The Australian Government's guide to valuing your business also lists staff, supplier and customer records, business plans and legal papers such as leases and insurance policies.
How far back should my records go?
Two or three years is the usual starting point for a valuation, though more history can help. Separately, business.gov.au says you need to keep most business records for 5 years, and some company records for 7 years, so the documents should already exist.
Tips for getting your documents ready
- Ask your accountant for the final statements and tax return in one request.
- Export year-to-date figures from your bookkeeping software.
- Write a one-page note on owner pay, one-off items and related-party deals.
- Name files clearly, by year and type.
- Say what is missing rather than leaving it out.
At Valuo, a list tailored to your business is sent once your terms are accepted, and you upload through a secure link to private storage. See how it works for each step.
Get started
When your documents are ready, Get your fixed fee. Fees for every revenue band are on the pricing page.
Some situations need different records and a specialist. For healthcare practices, see Medival. For start-ups and early-stage companies, see Start-Up Valuations. For separation, see Family Law Valuations.
Questions
How many years of financial statements do I need for a valuation?
Two or three recent years is the usual starting point, because it shows a trend rather than a single result. Valuo needs at least one year of financial statements to start, and with only one year, a Professional Valuation Report's scope is confirmed first.
Do I need audited accounts?
Not necessarily. The financial statements your accountant prepares are the usual starting point. The valuer may ask for supporting records if a number needs explaining.
Why does the valuer need to know what I pay myself?
Owners often pay themselves more or less than it would cost to employ someone to do their job. The valuer adjusts for that difference so the earnings reflect what the business would really need to spend.
What if my records are incomplete?
Send what you have and say what is missing. The valuer can tell you what matters most. Gaps can slow the work, narrow the scope or need extra explanation in the report.
Is it safe to upload my financials?
At Valuo, documents are uploaded through a secure link to private storage, never by open email attachment. Only the team on your valuation can see them.
General educational information, not advice. Examples are hypothetical and do not value a real business. The right treatment depends on the purpose, the evidence and the agreed scope.