Private market valuation practices under pressure as AI use surges
The applications are primarily efficiency-focused. AI tools are being used to draft valuation memos and materials by 58% of AI users, for quality review by 40%, and for document intake and data extraction by 40%. Replacing professional judgment is not yet on the table – the survey describes the prevailing posture as digital-driven and human-led.
The governance gap, however, is significant. While 42% of fund groups have a formal policy for acceptable AI use, 39% report having no formal AI governance or specific control practices in place. Among those using AI in valuation, only 10% have established vendor due diligence processes for the tools they are deploying, and just 7% have implemented output logging or audit trails.
That imbalance between adoption pace and governance maturity is drawing regulatory attention. The SEC’s Division of Examinations listed AI training and security controls among its fiscal year 2026 examination priorities, according to the agency’s published priorities cited in the Deloitte report.
SEC scrutiny holds elevated
Valuation remains near the top of the SEC’s examination agenda. Among the 19% of survey participants that reported an SEC examination in the past year, 53% said valuation policies and procedures were an area of focus, down from 58% in 2025 but above the 39% and 40% reported in 2024 and 2023 respectively. Nearly one-third also reported significant inquiries into internal valuation methodologies and the frequency of valuations for private equity, private credit, and restructured equities.
The regulatory pressure is not expected to ease. In a July 2026 statement on the regulatory agenda, SEC Chairman Paul Atkins noted the commission’s interest in better facilitating retail investor participation in private markets while preserving appropriate safeguards, according to the Deloitte survey.
