The short answer, explained
A valuation report prepared for the other party, or by a single expert both parties instructed, deserves a careful and structured read. A review is most useful when it asks the right questions in the right order: first what the valuer was asked to do, then what they actually did, then whether the key judgements are supported.
It also helps to sort every concern into one of two kinds. A factual error, such as the wrong revenue figure or a missed bank loan, can be pointed out and corrected. A judgement, such as the owner's replacement salary or the risk in the business, is not changed because one party prefers another number. Challenging a judgement needs evidence.
Sort every concern into a factual error or a judgement
What kind of concern is it?
A factual error, such as the wrong revenue figure or a missed bank loan
Point it out so it can be corrected
A judgement, such as the owner's replacement salary or the risk in the business
Not changed because one party prefers another number. Challenging it needs evidence.
This page is a working checklist. For what to do once you have found an issue in a family law matter, Family Law Valuations, the Valuo practice for family law matters, explains the options in what if you disagree with a business valuation, and how the single expert process works in single expert business valuations in family law.
The review checklist
| Check | What to look for | Why it matters |
|---|---|---|
| 1. Instructions and scope | The letter of instruction or engagement, the questions asked, any assumptions the valuer was told to adopt, and limits on scope | A report can be well reasoned and still answer the wrong question |
| 2. Valuation date | The date stated, and whether it matches the orders, the agreement or the instructions | Value at a different date may be irrelevant to the dispute |
| 3. Interest valued | Whole business, all shares, or a particular parcel; class of shares or units; entity name | Business value, equity value and a parcel's value are different figures |
| 4. Basis of value | Market value, fair value under an agreement, or another defined basis | The basis decides, for example, whether minority adjustments are allowed |
| 5. Financial information | Which years and documents were used, whether figures reconcile to tax returns, and what was missing | Gaps or errors here flow through to every later step |
| 6. Earnings normalisation | Each adjustment, its amount and the evidence: owner salary, non-recurring items, related-party rent, personal expenses | Normalisation adjustments can move value as much as the choice of method |
| 7. Maintainable earnings | Which year or average was chosen, and why | Choosing a peak or trough year can distort value |
| 8. Method choice | The primary method, why it suits this business, and any cross-check | An unsuitable method can mis-state value even with correct inputs |
| 9. Multiple or rate evidence | The source and reasoning for the capitalisation multiple or discount rate, whether the multiple's earnings basis (EBITDA, EBIT, after tax, SDE) matches the earnings it is applied to, and how it reflects this business's risks | A bare figure without reasoning is hard to test or rely on |
| 10. Bridge to equity | Surplus cash, debt, debt-like items, working capital, and loans to or from owners | Errors here change the share value directly, dollar for dollar |
| 11. Sensitivity | Whether the report shows how value changes with key assumptions | Shows which assumptions matter and how much |
| 12. Range of opinion | Whether the report acknowledges alternative views and explains its choice | Rule 7.22 requires a summary of any range of opinion in a report for the court |
| 13. Independence and qualifications | Statements about the expert's duty, independence and qualifications, and any limitations disclosed | A report for court must meet the rules on expert evidence |
Checks 1 to 4: what was the valuer asked to do?
Read the instructions before the conclusion. If the instructions are not attached or summarised, ask for them. Check whether the valuer was told to assume something that is disputed, such as a particular owner's salary or the inclusion of a property. An assumption imposed by instructions is not the valuer's judgement, and it may be the real issue in dispute.
Then confirm the valuation date, the exact entity and interest, and the basis of value. Our guide on enterprise value vs equity value explains why the report should state which figure it concludes on.
Checks 5 to 7: the earnings
For an earnings-based valuation, the adjusted earnings are often where the largest differences arise. Review each normalisation adjustment against its evidence. Our guides on normalising a working owner's salary and choosing maintainable earnings set out what a supportable adjustment looks like. The earnings normalisation worksheet can help you lay out the report's adjustments next to your own understanding of the business.
Factual points belong here too: if a large contract was lost after the last financial period used but before the valuation date, or a one-off expense was missed, that is information the valuer may not have had. Events after the valuation date are treated differently and may not be relevant unless they were foreseeable at that date.
Checks 8 to 9: method and evidence
The report should explain why its method suits the business and how the multiple or rate was chosen. Look for reasoning tied to this business's size, earnings stability, customer base, reliance on key people and industry, rather than a bare figure. Where comparable transactions or other market evidence are relied on, check that they are described and that they are genuinely comparable.
Check 10: the bridge to equity
Check every adjustment from business value to share value against the balance sheet at the valuation date. Common issues are cash treated as surplus when it is needed to trade, debt omitted or double counted, and owner loans ignored. See how cash and debt affect a valuation.
Check 11: sensitivity, with a worked example (hypothetical)
This example is hypothetical, with round numbers, to show how to find the assumptions that matter. Suppose a report adopts maintainable earnings of $300,000 and a capitalisation multiple of 3.0, giving business value of $900,000. Your review suggests the owner's salary adjustment may be understated by $40,000, which would reduce maintainable earnings to $260,000, and you also question the multiple.
A $40,000 salary point takes $120,000 off business value at a multiple of 3.0
- Report: $300,000 × 3.0$900,000
- Salary adjustment understated by $40,000 (× 3.0)−$120,000
- Revised: $260,000 × 3.0$780,000
Scale starts above zero so the changes are visible. Totals are cut short.
| Maintainable earnings | Multiple 3.0 | Multiple 3.5 |
|---|---|---|
| $300,000 | $900,000 | $1,050,000 |
| $260,000 | $780,000 | $910,000 |
Business value ranges from $780,000 to $1,050,000 across the two points in dispute
- $300,000 at 3.5$1,050,000
- $260,000 at 3.5$910,000
- $300,000 at 3.0 (the report)$900,000
- $260,000 at 3.0$780,000
The earnings point moves value by $120,000 to $140,000 and the multiple point by $150,000, which shows where to focus: both points matter, and each needs evidence. The capitalised earnings sensitivity tool runs the same kind of table.
Checks 12 to 13: the rules on expert evidence
In family law proceedings in the Federal Circuit and Family Court of Australia, Part 7.1 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 governs expert evidence. Among other things:
- Parties may jointly appoint a single expert witness (rule 7.03), and once a single expert has been appointed on an issue, a party must not rely on another expert on that issue without the court's permission (rule 7.08).
- The expert's duty to the court prevails over any obligation to the person instructing or paying them, and includes giving an objective, unbiased opinion and considering all material facts, including those that may detract from the opinion (rule 7.18).
- The report must state the reasons for the conclusions and the methodology, and include the expert's qualifications, the facts, matters and assumptions relied on, a summary of any range of opinion and the basis for the expert's opinion, and any necessary disclosures that the report may be incomplete or the opinion is not concluded (rule 7.22).
- A party may put written questions to a single expert to clarify the report, once only, within 7 days after any conference or otherwise within 21 days after receiving the report (rule 7.26).
Checking the report against rule 7.22 is a useful discipline even outside court proceedings. Other courts and tribunals have their own rules, and family law matters in Western Australia are generally heard in the Family Court of Western Australia rather than the FCFCOA, so these Rules may not apply there. Your lawyer will confirm which rules apply.
Limitations
This page is general guidance on reading a valuation report. It is not legal advice and it does not tell you whether to challenge a report or how. Court procedures, time limits and costs consequences depend on the court and the orders made in your matter, so decisions about questions, conferences, cross-examination or a second expert should be made with your lawyer. A review that finds no clear error is also a useful result: it can save the cost of a contest that would not change the outcome.
Next steps
- Obtain the report's instructions and the documents the valuer relied on.
- Work through the checklist and sort each concern into factual or judgement.
- For each judgement concern, gather the evidence that supports a different view.
- Discuss the time limits for questions with your lawyer early.
- Family Law Valuations, the Valuo practice for family law matters, can review a report prepared for the other party and explain which points are worth raising.
Questions
Can I ask the single expert questions about their report?
In proceedings under the Federal Circuit and Family Court of Australia (Family Law) Rules 2021, a party may put written questions to a single expert, once only and only to clarify the report, within the time limits in rule 7.26. Your lawyer will manage this step.
Can I get my own valuer if I disagree with the single expert?
Under those Rules, once a single expert has been appointed on an issue, a party needs the court's permission to rely on another expert on that issue, and the court must be satisfied of one of the grounds in rule 7.08. A private review of the report can still help you decide whether there is a real issue to raise.
Is a large difference between two reports proof that one is wrong?
No. Reasonable valuers can reach different conclusions on judgement points. A review should identify which assumptions cause the difference and whether each is supported by evidence.
Sources
- Family Court of Western Australia, Family Court of Western Australia. Family law matters in Western Australia are generally heard in this court rather than the FCFCOA.
- Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Compilation No. 4), Federal Register of Legislation. Part 7.1: r7.03 single expert appointed jointly; r7.08 once a single expert is appointed, another expert on the same issue needs permission; r7.18 expert's duty to the court; r7.22 required contents of an expert's report; r7.26 written questions to a single expert.
- Market valuation of assets, Australian Taxation Office. Minimum contents of a market valuation report (purpose, scope, asset, date, basis) and what instructions to a valuer should cover, written for tax purposes.
Cite or reuse this page
Valuo Insights team (2026). How to review a valuation report prepared for the other side. Valuo. https://valuo.com.au/insights/reviewing-the-other-sides-valuation-report/ (updated 14 November 2026).
Quote short passages with attribution and a link to this page. Charts and tables created by Valuo may be republished unchanged with the credit "Source: Valuo (valuo.com.au)" and a link. Third-party sources keep their own terms. See the reuse terms.
General educational information, not financial, tax or legal advice. Worked examples are hypothetical and do not value a real business. A valuation depends on its purpose, the evidence and the agreed scope.