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Valuation Uncertainty 2012

Valuation Uncertainty 2012

The Leaders’ communique after the G20 meeting in London in April 2009 identified valuation uncertainty as a contributory factor to the financial crisis and called for improved standards for disclosure. Various regulatory bodies and the International Accounting Standards Board also started to examine the impact of valuation uncertainty in the context of solvency ratios and financial reporting. IVS 103 Reporting requires any “material uncertainty” to be disclosed in valuation reports. In the light of all of these matters the IVSC Standards Board approved a project in late 2009 to examine the nature, causes and disclosure of valuation uncertainty and the need for guidance on its identification and disclosure.

A Discussion Paper was published in September 2010 with a comment period to 24 December. The comments received confirmed the need for guidance on this topic.

The Board suspended further consideration of the project pending the completion of the IVS Improvements Project. In June 2011 it approved a Brief to develop guidance. A working group of valuation specialists from different sectors and world regions was approved in November 2011. The Board approved an Exposure Draft for public comment at its meeting in October 2012. The Draft was published on 12 November with a comment period closing on 15 February 2013. The comment letters can be viewed here.

The Board considered the comments received and requested various amendments be made to to the proposed guidance. It approved a final document at its meeting in November 2013. This is to be published as Technical Information Paper 4 in January 2014.

Working Group:

Board members
Ana Castaneda – Chairman Standards Board
Thomas Boyle Standards Board
Paul Hawkes Standards Board
External Experts
Professor Neil Crosby University of Reading United Kingdom
Larry Dybvig Grover Elliot & Co Canada
Angelos Malamidis NBG Property Services Greece
David Larsen Duff & Phelps (representing IPEV Board) USA
Professor Richard Reed Deakin University Australia
Professor Tony Van Zijl Victoria University of Wellington New Zealand
Sarah Von Helfenstein Value Analytics & Design, LLC USA

Background

Documentation

Exposure draft - valuation uncertainty

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Discussion paper - valuation uncertainty

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