IVS 106: Documentation and Reporting in Family Law Business Valuations

When a business valuation is used in a family law dispute, the final number is only part of the story. Courts, lawyers, and the parties involved must understand how that number was reached. Without clear documentation and transparent reporting, even a well prepared valuation can be questioned or challenged.

This is where IVS 106: Documentation and Reporting becomes critical. The International Valuation Standards require valuers to clearly document their work and produce a report that explains the valuation process, assumptions, and conclusions. These standards help ensure that valuations used in legal proceedings are transparent, reliable, and capable of standing up to scrutiny.

For family law matters, where financial evidence often plays a central role in property settlements, proper valuation documentation is essential.

What IVS 106 Requires in a Valuation

IVS 106 sets out the standards for how a valuation must be recorded and reported. The goal is to ensure that anyone reading the report can clearly understand how the value was determined.

Under the standard, the results of a valuation must always be documented and reported in writing. This can include electronic files, working papers, client communications, and the final valuation report itself.

The documentation must be detailed enough that another professional valuer could understand:

• The scope of the engagement

• The work performed

• The data and inputs used

• The professional judgement applied

• The reasoning behind the final value conclusion

  
  

Documentation may include working papers, communications with the client, alternative methods considered, and the steps taken to address risks or potential bias in the valuation process.

In family law disputes, this level of transparency is particularly important because valuations are often tested through cross examination or reviewed by other experts.

What Must Be Included in a Valuation Report

IVS 106 also specifies the minimum information that must appear in a valuation report. This ensures that users of the report clearly understand the basis of the conclusion.

At a minimum, a valuation report should include:

• The agreed scope of work

• The assets or liabilities being valued

• The identity of the valuer and the client

• The intended use and intended users of the valuation

• The valuation date and currency used

• The basis of value adopted

• The valuation approaches and methods applied

• The key data and inputs relied upon

• Any significant assumptions or limitations

• The final value conclusion and supporting rationale

  
  

These requirements help ensure that valuation reports are structured, transparent, and capable of being reviewed or relied upon by courts, lawyers, and other professionals.

Why Documentation Matters in Family Law Disputes

Family law valuations are rarely straightforward. Businesses may have incomplete records, disputed income, or unusual financial structures. In many cases, each party may engage their own expert.

When this happens, the quality of the documentation behind the valuation becomes extremely important.

Strong documentation allows the expert to clearly demonstrate:

• How financial data was analysed

• Why certain valuation methods were chosen

• How assumptions were formed

• How risks or uncertainties were managed

  
  

If the valuation is challenged in court, this documentation provides the evidence that supports the expert opinion.

The Role of Forensic Accounting

At DB Forensic, forensic accountants specialise in preparing business valuations that comply with recognised professional standards such as the International Valuation Standards.

In family law matters, the team works closely with lawyers and clients to analyse financial records, document valuation assumptions, and produce clear reports that explain the reasoning behind the value conclusion.

This structured approach ensures that the valuation evidence is transparent, defensible, and capable of being relied upon in negotiations, mediation, or court proceedings.

Need a Clear and Defensible Valuation Report?

Family law disputes often involve complex financial evidence. A properly documented valuation can make the difference between confusion and clarity in a property settlement.

DB Forensic can assist lawyers and clients by preparing independent, well documented valuations that comply with professional standards and clearly explain the basis of value.

Review Your Valuation Evidence