Three of the major elements I felt were most important in the Statement on Standards for
Valuation are:
• b Professional Competence – This element states that you need to have the overall
knowledge, skill, and competence to provide the professional services for a client, which I
believe is one of the most critical and (seemingly) common sense elements for this type of
service. As stated in VS Section 100 of the SSVS “a Valuation analyst should possess a level
of knowledge of valuation principles and theory and a level of skill in the application of such
principles that will enable him or her to identify, gather and analyze data, consider, and
apply the appropriate valuation approaches and methods, and use their professional
judgement in developing the estimate of value (AICPA).”
• b Objectivity and Conflict of Interest – this element I believe also speaks for itself in that
it is your professional responsibility to remain “impartial, intellectually honest, disinterested,
and free from conflicts of interest (AICPA)”.
• b Establishing an Understanding with the Client – this element explains that you should
have an understanding with the client and suggest that this be in writing on what is
expected to be performed. This is important across the board for all business engagements
but should set the standard of what is expected so that both parties have an agreed
understanding of valuation and be modified or amended as other circumstances arise
(AICPA).
In review of the provided link to the Business Valuation/Appraisal Standards Comparison
Chart, the SSVS elements follow in comparison to other standard-setting bodies which all
seem to lay out the core standards for valuation. The American Society of Appraisers (ASA)
and Institute of Business Appraisers (IBA) are all shown alongside AICPA’s with the only
differences being the layout and section breakdowns for each, showing that these are all
covering the same core standards (NACVA).
References:
AICPA. (2007, June). Statement on Standards for Valuation Services (VS Section 100).
Resources | AICPA. https://www.aicpa.org/resources/download/statement-on-standards-for-
valuation-services-vs-section-100
NACVA Standards Board. Business Valuation/Appraisal Standards Comparison Chart.
NACVA. http://web.nacva.com/TL-Website/PDF/StandardsChart-B%20FINAL.pdf
