The market value of an asset is the amount that a willing buyer and seller would agree to in an arms-length transaction. These valuations will be used when preparing your fund's accounts, statements and SMSF annual return (SAR).
Your asset valuations will be reviewed by your approved SMSF auditor as part of the annual audit prior to lodgement of your SAR. Your auditor will check that assets have been valued correctly, assess and document whether the basis for the valuation is appropriate given the nature of the asset. They are not responsible for valuing fund assets.
Remember to get your valuations done before you go to your auditor.
It's your responsibility to provide objective and supportable evidence to your auditor for the valuation of the fund's assets, including all relevant documents requested to prevent delays in auditing the fund. Failure to do so could result in a potential late lodgement of your annual return or a contravention if mistakes have been made.
Start researching now to find what type of evidence you need to support the valuation as this can take time. For some asset types, the law requires valuations to be undertaken by a qualified independent valuer.
For more information, refer to the SMSF valuation guidelines on the ATO website.