The Consulting Services Executive Committee of the American Institute of CPAs released a new standard on valuation services. Its Statement on Standards for Valuation Services No. 1, "Valuation of a Business, Business Ownership Interest, Security or Intangible Assets," provides guidelines to CPAs for developing estimates of value and reporting on the results. It applies to institute members who perform an engagement that estimates the value of a business, business interest, security or intangible asset for numerous purposes, including sales transactions, financing, taxation, financial reporting, mergers and acquisitions, management and financial planning, and litigation. SSVS No. 1 specifies two types of engagements: valuation engagements and calculation engagements. For valuation engagements, two types of written reports are permitted - detailed reports and summary reports. For calculation engagements, one type of written report is permitted - calculation reports. Oral reports are allowed for all engagements under the standard. SSVS No. 1 is effective for engagements accepted on or after Jan. 1, 2008. A copy of the standard has been posted to the AICPA Web site at http://bvfls.aicpa.org/Resources/Laws+Rules+Standards+and+Other+Related+Guidance/AICPA+Valuation+Standard+and+Implementation+Toolkit.htm.
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