The first element that I chose is Professional Competence, The
“General Standards Rule” of the code (ET sec. 1.300.001 and
2.300.001) states that a member shall "undertake only those
professional services that the member or the member's firm can
reasonably expect to be completed with professional competence." If
you aren't skilled to do the task then don't do it. The second element
I chose is Nature and Risks of the Valuation Services and
Expectations of the Client "To understand the nature and risks of a
perspective valuation engagement and the expectations of the client,
the CPA should consider the following: Terms of the engagement,
client identity, nature of the business and ownership rights,
procedural requirements of the engagement, the use of and
limitations value report, and any obligation to update the valuation in
the future." The last element I chose is Assumptions and Limiting
Conditions For example: "1) arriving at a conclusion of value while
assuming that the current level of management expertise and
effectiveness will be maintained, or 2) relying on management’s
financial statements without any verification of their accuracy and
integrity".
The Statement on Standards for Valuation Services, Valuation of a
Business, Business Ownership Interest, Security, or Intangible
Asset
(“VS Section 100” or “SSVS”) was issued by the AICPA
Consulting Services Executive Committee in June 2007 for
engagements accepted on or after January 1, 2008. AICPA members*
are required to follow VS Section 100 when they perform
engagements to estimate value that culminates in the expression of a
conclusion of value or a calculated value. The standard is intended to
provide guidelines for developing estimates of value and reporting
on the results.
http://archives.cpajournal.com/2008/608/essentials/p54.htm
