The International Valuation Standards Council and the Appraisal Foundation have released a document explaining how they plan to harmonize their standards for assessing the value of both tangible and intangible assets.
The two groups have been working for the past year to overcome differences between the IVSC’s International Valuation Standards and the Appraisal Foundation’s Uniform Standards of Professional Appraisal Practice.
Most U.S. appraisers are already required to comply with USPAP and would need to take extra steps to comply with IVS. The new guide, referred to as a “bridging document,” aims to help appraisers who are familiar with USPAP produce a valuation that also complies with IVS. It covers intangible assets along with more tangible assets such as real property interests, plant and equipment.
“The release of this bridging document marks an important step towards our objective of establishing globally accepted valuation standards,” said IVSC chair Sir David Tweedie, the former chairman of the International Accounting Standards Board, who also undertook the effort to converge International Financial Reporting Standards with U.S. GAAP. “Valuations underpin economies by providing investors and businesses with the information they need to make informed decisions. With so many different methods and approaches for valuation across the world it is difficult for many international businesses to understand the true value of assets, so our work to harmonize valuation standards is crucial to aiding business and the smooth functioning of markets worldwide. We look forward to working further with the Appraisal Foundation and achieving our common goals.”
The document will be amended to be consistent with updates to standards as they happen.
“While there are varying regulatory environments, business practices and cultures among the world’s economies, we believe that core valuation standards should transcend these differences,” said of The Appraisal Foundation president David Bunton in a statement. “The members of our respective Standards Boards have dedicated a great deal of time and effort to this harmonization project and their efforts on behalf of the global valuation profession should be recognized.”
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