Valuation for Regulatory Purposes

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Valuation of Financial Products & Instruments

In today’s business environment, many transactions and corporate actions are governed by regulations requiring independent, compliant, and auditable valuations. At Harshul Mangal & Associates, we help you meet those regulatory requirements—ensuring that your valuation reports are defensible, accurate, and in alignment with multiple Indian statutes and reporting standards. Regulatory valuations are often required for legal compliance, tax filing, accounting disclosures, mergers, securities transactions, and more. We make sure your valuations satisfy all necessary regulatory legalities so there are no surprises during audits, investigations, or transaction approvals.

Why Harshul Mangal & Associates

Expertise in Regulatory Law & Valuation Combo — Deep understanding of both valuation methodology and the legal/regulatory obligations.
Registered Valuers & Practice Compliance — Fully compliant under Companies (Registered Valuers and Valuation) Rules, 2017.
Transparent, Defensible Assumptions & Disclosures — All assumptions disclosed, conflicts of interest managed, methodology explained.
Proven Track Record — Worked with corporates, NBFCs, ARCs, legal professionals, regulatory bodies on valuation assignments under regulatory mandates.
Timely Delivery & Thorough Reviews — We ensure reports are delivered on schedule and are ready for scrutiny by auditors, courts, or regulatory agencies.

Key Regulatory Frameworks in India

Here are the main legal / regulatory contexts that often trigger valuation requirements:

Companies Act, 2013

Any valuation of stocks, shares, debentures, securities, goodwill, assets, liabilities, or net worth must be done by a Registered Valuer. The rules prescribe qualifications, code of conduct, independence, disclosure, and valuation standards.

Income Tax Act, 1961

Fair Market Value / Arm’s Length Pricing (Section 92C etc.), Rule provisions for share issue / transfer, valuation implications on capital gains, etc.

FEMA / FDI / ODI Regulations

For cross-border share transfers, investments by non-residents, etc. Valuations often needed as per RBI / FEMA guidelines.

Ind-AS / IFRS

For financial reporting under Indian Accounting Standards (e.g. fair value requirements under Ind-AS 109) and IFRS convergence.

SEBI / RBI / Other Sectoral Regulators

Listing requirements, disclosures, transaction approvals etc. These may demand valuation reports in specific formats, or by particular kinds of valuers.

When You Need Regulatory Valuation

Some of the common scenarios include:

Mergers, demergers, amalgamations, and corporate restructuring
Issue or transfer of shares (especially unlisted, preferential or related party)
Foreign Direct Investment (FDI) or Overseas Direct Investment (ODI) transactions
Related-party transactions & transfer pricing under tax law
Fair value disclosures in financial statements under Ind-AS / IFRS
Valuation for securities law compliance, IPO / listing, or for regulatory filings
Compliance due to regulatory audits, disputes or scrutiny

Deliverables

When engaging Harshul Mangal & Associates for Regulatory Valuation, you will receive:

✔ Formal valuation report compliant with the applicable statutory/regulatory framework (Companies Act, Tax Act, FEMA, etc.)

✔ Detailed scope & purpose section: which law(s) the valuation is for, who appointed, valuation date etc.

✔ Disclosure of assumptions, methods, discount/yield curves, market data/comparables used

✔ Comparative / scenario / sensitivity analyses where relevant

✔ Audit-grade working schedules & supporting appendices (legal documents, financials, comparables, input assumptions)

✔ Regulatory / audit / compliance checklist showing how the report addresses specific requirements (Registered Valuer rules, Ind-AS, Section 92 etc.)

✔ Assistance during regulatory reviews, answering questions from authorities or auditors

Our Approach & Methodology

We follow a structured, transparent and regulation-aligned process, ensuring your valuation is credible, defensible, and accepted by regulatory or judicial authorities if needed.

Regulatory Context & Purpose Assessment
Understand which statutory requirements apply in each case (Companies Act, Tax Act, FEMA, etc.), purpose of valuation (e.g. compliance, transaction, dispute), and stakeholder requirements (auditors, regulator, courts).
Eligibility & Registered Valuer Requirements
Ensure the valuer or team meets eligibility criteria under relevant rules (for example, the Companies (Registered Valuers and Valuation) Rules, 2017). Check for disclosures, independence, conflict of interest as required by law.
Standards & Method Selection
Use the valuation standards prescribed under law (or if none specifically notified, the standards adopted by registered valuers organisations, or international best practices). Choose methodology suited to regulatory requirement: comparable, DCF, yield, market value, etc.
Data Collection & Controls
Collate audited financial statements, legal documentation, market data, comparable transactions. Verify inputs for relevance and accuracy. Document assumptions.
Valuation Modelling
Develop models appropriate for purpose, with scenario / sensitivity analysis. For example, for related-party or share transfer cases, show how values may vary under different discount rates or perpetuity growth, as regulators may focus on assumptions.
Draft Report, Review & Compliance Disclosure
Create draft valuation report with disclosures required: entity & valuer identity, valuation date, scope, purpose, assumptions, limitations, methodology, comparables. Also include statements of conflict of interest, compliance with statute, relevant valuation standard.
Stakeholder Engagement & Finalisation
Address queries from auditors, regulators, investors. Finalize report, ensure it meets format requirements of relevant law/regulator. Assist in submissions, hearings or reviews if needed.

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