Documents Needed for a Business Valuation
A Business Appraisal Checklist to Get You Started
Table of contents
What is the intended use of this Business Appraisal or Business Valuation?
- Brief company history and description
- Revenue and earnings (4-5 years if possible)
- Is this business valuation for an SBA or bank loan?
- Are company revenue and earnings stable or growing?
- What are the customer concentrations?
- What is the current ownership structure and ownership information? Any sale or purchase of company stock in the last five years? Any stakeholder buy-sell agreements?
- What are the Exiting Party or Client goals?
- What deal structure is the Exiting Party or Client open to (if applicable)?
- Will there be sufficient management continuity?
- Current capital structure with a list of business owners
- Financial Statements, including:
- Balance Sheet
- Income Statement or Profit and Loss Statements
- Cash Flow Projections and Statements
- Account Receivable Aging Report
- Accounts Payable Aging Report
- 4-year historical financial statements (Better if a review from your CPA, but a compilation beats no financials from a CPA)
- 4-5 years of historical tax returns
- Current YTD interim financial statements with comparative prior year interim period
- Quarterly summary P&L (past three years)
- Detailed calculation of EBITDA
- Description of major product categories
- Revenue by period by significant product category
- Description of the sales process and customer profile
- Market size; share analysis; opportunities and threats to market share
- Key competitors and market information
- Dashboard metrics currently used to evaluate sales performance
Customer concentrations – List the five largest customer revenue amounts for the past three years and a total of all other customers.
Vendor concentrations – List the five largest vendors with numbers for the past three years and a total of all other vendors. Do you have any contracts or licensing agreements in place?
- Headcount by function
- A brief biography of key employees
- Any deferred compensation or perks?
- Any non-compete agreements?
- Any employment contracts?
Facilities & Assets – ownership or lease terms for all buildings, land, real estate, patents, copyrights, trademarks, intellectual property, intangible assets, websites, equipment, and any other business assets.
Description of any current/pending litigation or tax issues
Any adjustments to Income? Please read our article on adjustments to income when valuing a company.
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You can also check this article as an additional guide to business appraisal to get an insight into the process and why each document is needed for a business valuation from a certified valuation analyst or CVA at Business Appraisal FL|GA|HI.