The emergence towards the end of 2019 of the novel coronavirus, also known as Covid-19, and the resulting global pandemic, has created a huge amount of uncertainty around the world. Among the many manifestations; this has led to enormous market volatility. These times have been made even more interesting in respect of valuation as valuers are having to value assets, when there are limited to no comparable evidence and all markets are facing an uncertain future.
The objective of this letter – first issued by the IVSC Standards Review Board in April 2020 – is to provide additional information on factors that may give rise to significant valuation uncertainty in a way that is useful to those who will be preparing or relying on the valuation. It should be noted that this article does not deal with uncertainty caused by limitations imposed under the terms of engagement on the extent of investigations or information, though this topic is also relevant for these challenging times and may be dealt with in a future IVSC perspectives paper.