Does the description disclose side effects, auth requirements, rate limits, or destructive behavior?

Annotations already declare readOnlyHint, idempotentHint, and destructiveHint=false, so the safety profile is covered. The description adds behavior beyond that: exactly one method per call, no defaults, and the failure mode (an INVALID_ARGUMENT error envelope rather than a raised exception). It does not need to discuss auth or rate limits for a pure in-process computation, so this is close to complete.

Agents need to know what a tool does to the world before calling it. Descriptions should go beyond structured annotations to explain consequences.

Is the description appropriately sized, front-loaded, and free of redundancy?

Purpose is front-loaded and the routing rule follows before the method list. The enumeration of methods and their inputs is long, but each entry is load-bearing because the schema does not encode per-method requirements. Slightly dense, yet nothing is redundant with the structured fields.

Shorter descriptions cost fewer tokens and are easier for agents to parse. Every sentence should earn its place.

Given the tool's complexity, does the description cover enough for an agent to succeed on first attempt?

An output schema exists, so return values need not be described. With the safety profile in annotations, per-method input requirements, sibling routing, and error semantics all stated, an agent has everything required to select a method and call it correctly.

Complex tools with many parameters or behaviors need more documentation. Simple tools need less. This dimension scales expectations accordingly.

Does the description clarify parameter syntax, constraints, interactions, or defaults beyond what the schema provides?

Schema coverage is 100%, which normally caps the baseline at 3, but here the schema marks 12 of 13 parameters as optional-with-null, so it cannot convey which inputs a given method actually requires. The description supplies that mapping explicitly per method (e.g. "terminal_multiple: final_cash_flow, exit_multiple; viu_pre_tax: cash_flows, pre_tax_discount_rate"), which is information no single-parameter schema description can express.

Input schemas describe structure but not intent. Descriptions should explain non-obvious parameter relationships and valid value ranges.

Does the description clearly state what the tool does and how it differs from similar tools?

States a specific verb and resource ("Discounted cash flow valuation engine") and enumerates the exact technique families covered (FCFF/FCFE DCF, NPV/IRR, terminal values, multi-stage growth). It also names the sibling tools it is not (calculate_residual, calculate_market_multiple, calculate_loss_making_company), so an agent can discriminate without opening any schema.

Agents choose between tools based on descriptions. A clear purpose with a specific verb and resource helps agents select the right tool.

Does the description explain when to use this tool, when not to, or what alternatives exist?

Gives an explicit routing rule: "Use this for going-concern cash-flow businesses; for asset-anchored or financial firms use calculate_residual, for peer-based pricing use calculate_market_multiple, and for pre-profit companies use calculate_loss_making_company." This is a when-to-use plus three named alternatives with the condition selecting each.

Agents often have multiple tools that could apply. Explicit usage guidance like "use X instead of Y when Z" prevents misuse.