Who prepares the valuation
In New York divorces, a business is often valued by a neutral appraiser appointed by the court or agreed on by both spouses, and each side can also retain its own valuer to review or rebut that work. A single neutral can keep costs down, while separate valuers may make sense when the stakes are high or the owner's records are disputed. Credentials matter; appraisers commonly hold accounting or valuation designations and should be able to explain their choices in plain language. The court decides how much weight a valuation deserves, so whoever prepares it has to be ready to defend it. Settling on the approach early avoids paying twice for the same analysis.
What the appraiser examines
The appraiser usually reviews several years of tax returns, financial statements, bank records, and payroll, and often visits the business and interviews the owner. A central step is normalizing earnings, which means adjusting for expenses that are really personal, owner pay above or below market, and one-time events. The appraiser then chooses among income, market, and asset-based methods, and decides whether discounts apply, for example for a minority stake or an interest that cannot easily be sold. In New York, the valuation date can depend on whether the value changed through a spouse's efforts or through market forces. Each of these steps involves judgment, which is where disagreements usually arise.
Testing the report
A draft or final report opens the discussion rather than closing it. Lawyers and any retained valuer check the assumptions, look for income left out or counted twice, and compare the result with the business's own loan applications or past offers to buy it. Disputes are often resolved through negotiation once both sides understand where the numbers diverge. In a first meeting about valuing a business in divorce, we discuss whether a neutral or retained valuer fits your case, which records are likely to be requested, and a realistic budget for the work. Owners should expect to provide access and answer questions, and non-owner spouses should share whatever they know about how the business really runs.
