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Define the instruction at the front
Begin with a sentence that names the decision: “We need a valuation of this shareholding to support a proposed shareholder buyout.” Then identify the legal entity, the exact interest, the valuation date, the intended users and the purpose. A valuation of an operating business and a valuation of a particular parcel of shares can require different analysis.
Agree the basis of value and any specific requirements with the valuer before work begins. A report commissioned for one negotiation may not suit a lender, a dispute or another transaction. Ask those who need to rely on the report what they require and have the engagement reflect that.
This is an owner's preparation template, not a completed valuation or a statement of compliance. The International Valuation Standards cover scope, bases of value, approaches, data, models and reporting, with separate provisions for businesses and business interests. Your valuer should explain which standards and requirements apply to the engagement.
Copy into your working brief
A blank business valuation report outline
| Section | Details to record or request |
|---|---|
| 1. Instruction | Client: [name]. Entity or assets: [identify]. Interest: [whole business / specified shares / assets]. Purpose: [decision]. Valuation date: [date]. Intended users: [names]. |
| 2. Scope and basis | Basis of value: [agree with valuer]. Work to be performed: [scope]. Information responsibilities: [who provides what]. Restrictions on use: [agreed terms]. |
| 3. Business context | How revenue is earned; products or services; customers and suppliers; key people; ownership; assets and contracts; dependencies that affect future performance. |
| 4. Evidence | Accounts and reporting periods; management figures; forecasts; contracts; ownership records; source and date of each item; missing information and its significance. |
| 5. Financial analysis | Reported results; proposed adjustments and reasons; reconciliation to the original records; forecast assumptions; working capital, cash and debt treatment. |
| 6. Methods | Approaches considered; selected method and why it fits; inputs and their sources; calculations; cross-checks and explanations of differences. |
| 7. Uncertainty | Key assumptions; information limitations; sensitivities; circumstances that could materially change the result. |
| 8. Conclusion and use | Conclusion for the specified interest and date; bridge from calculations to that conclusion; qualifications; intended use; report date and responsible valuer. |
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Connect business context with financial evidence
Build an evidence folder with a short index. Put the reporting period and source beside each file so that annual accounts, current management figures and forecasts can be distinguished. Our valuation preparation guide helps you organise this material before the engagement starts.
Keep reported figures alongside proposed adjustments. If you believe an expense is unusual, explain what happened, supply the record and ask the valuer whether an adjustment is appropriate. If the owner will leave, explain who would perform that work and what resources the business would need. The reasoning matters more than presenting a higher adjusted profit.
Make forecasts traceable to business drivers. Separate assumptions about customer retention, pricing, staffing and investment so someone can see what must happen for the forecast to be achieved. Record material changes since the latest accounts and ask how they affect the valuation at the agreed date.
Give the valuer the ownership and transaction documents relevant to the instruction. A summary of the business's trading performance alone may leave out rights or obligations that matter to a particular shareholder's interest.
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Explain the approach, uncertainty and conclusion
A useful report connects the selected method to the business and the purpose. Ask why the chosen approach fits, where the key inputs came from and why alternatives were not given the same weight. Our comparison of business valuation methods gives you the vocabulary for that conversation.
Read the reconciliation before the headline number. Ask how the result moves from the value of the operation to the interest named in the instruction, including the treatment of cash, borrowing and any other relevant items. Check that the same date and definitions are used throughout.
Ask which assumptions have the greatest effect and request an explanation of appropriate sensitivity analysis. A range or scenario is useful only when you can see what changed and why. Keep information gaps visible so the report's readers understand the limits of the conclusion.
Before forwarding the report, check its intended users and restrictions. If the transaction, date or purpose changes, ask whether the work needs updating. An agreed price also involves negotiation and deal terms; the report is one input to that decision.
Illustrative worked example
Briefing a valuation for a shareholder buyout
Imagine two shareholders discussing the purchase of one owner's 25% holding. They have an earlier report about the whole business. The following fictional brief shows how to avoid asking that report to answer a different question.
- Instruction: Value the departing owner's specified shares at an agreed date for the proposed buyout. Name the parties who will use the work and provide the shareholder agreement.
- Evidence pack: Assemble the accounts, recent management results, forecast assumptions, share register, borrowing schedule and material agreements. Log missing records and who will obtain them.
- Question for the valuer: Explain how the whole-business assessment connects to this shareholding, taking account of the rights and terms relevant to the instruction.
- Review point: If an illustrative whole-equity figure were $2 million, simple multiplication would give $500,000 for 25%. That is arithmetic only. Ask the valuer whether proportional allocation is appropriate before using it as a conclusion for the actual interest.
- Next decision: Discuss the valuation alongside the payment proposal, funding and legal terms. If those terms change, check which parts of the advice need revisiting.
The example figures are invented solely to explain the distinction. They are not a business valuation, market multiple or suggested price.
Your next move
Bring a brief that matches your decision
Start with the instruction row above and your evidence index. Our independent business valuation service connects the assessment with your ownership decision. We work from Hawke's Bay with clients across New Zealand.
Discuss your valuation report brief