New Valuation Standards— For Business Valuation Review Services |
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Dear Member: Since NACVA’s Professional Standards were last updated, June 1, 2011, it has been contemplated that our standards needed to be expanded to address another area of valuation service and one of growing demand for the valuation community—an engagement to review another practitioner’s valuation report. Over the last year, under the direction of Carl Steffen, Mark Kucik, and Mark Hanson, with the oversight of the Executive Advisory Board, NACVA’s Standards Committee has carefully crafted succinct standards to put a framework around report review services and give members clear guidance in the performance of such services and in the preparation of a Business Valuation Review Report. As we have with previous updates to our standards, we were compelled to put these to a vote of our membership. This was done last May. We had nearly 400 respondents with an overwhelming majority of 85% voting to approve. Comments from those who did not approve centered predominantly around five areas of concern, which in our opinion grew from confusion rather than shortcomings in the Standards. As such, we did two things: One, we tweaked some verbiage in the new standards to help them read more clearly. Two, we created a Frequently Asked Questions (FAQ) document with the Committee’s responses to the five areas of concern. Certainly, you will have other questions, but hopefully they will be few as the Committee and development team have gone to great extremes to create standards that will help and not hinder you in your pursuits. NACVA’s Professional Standards are found on the following link; the new Business Valuation Review Standards can be found on pages 11–13. The Committee thought it prudent while in this updating process to make two minor changes within the original standards document. The first is to move the general Documentation requirement, previously found in the Development Standards, section IV, to fall in the General and Ethical Standards, section II, letter J, realizing that this standard should apply in all engagements and practices with which a member may be involved. The second change was to add to this Documentation paragraph NACVA’s recommendation that records be retained for five years. The effective date of these new standards is August 1, 2015. Please send your queries or comments to our Standards Committee Chair, Carl Steffen, at csteffen@wsrp.com. Thank you.
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National Association of Certified Valuators and Analysts™ |
