The need for a difference in valuation dates is explained by the way various assets are used after the date of separation. Checking, savings and credit card accounts continue to be used by the parties to pay for their separate living expenses. Separate property earnings and support payments are deposited to and paid from these accounts. Community property balances that existed in these accounts at the date of separation are quickly replaced by separate property money. Depending on the way these accounts are used, it may be necessary to prepare post separation accounting in order to allocate community property balances between the parties.
An agreed upon (or court established) date most often applies to business values. In general, a business is valued as of the date nearest to a settlement/trial. As a practical matter, this date may be the nearest ending date of a year or a quarter, depending on how the business is operated and how often its financial statements are prepared.