Are you valuing businesses with operations outside the United States? Then you would do well to consider compliance with the International Valuation Standards or IVS for short. Published and promulgated by the IVS Council, this key valuation standard has been adopted by most market economies world-wide.
Standards build public trust
As the IVS Council states, the standards aim to build public trust and confidence in valuations. In addition, they also serve as a set of guidelines universally adopted by business valuation professionals and clients around the world. The idea behind the International Valuation Standards is to lay down a set of ground rules and establish the level of professionalism in applying them, no matter the country.
Why do standards such as the IVS work? Because they adopt well accepted concepts and methodologies for valuation. And this offers transparent and consistent results for a broad range of audiences, including business people, legal experts, business transaction professionals, and government bodies.
The group of experts who penned the IVS did not do so in a vacuum. Part of the standard development process is reaching out to influential members of the business valuation community. This larger group includes business appraisers, prominent users of valuation services, regulatory agencies, and professional organizations.
If you pick up an IVS compliant business valuation report, you should expect to see a result that is based on well understood and consistently applied valuation methodologies. Both novices and professional business appraisers can create such valuation reports without the risk of confusing or misleading the readers.
How you can use the International Valuation Standards and USPAP
But what about the earlier appraisal standards, especially the venerable USPAP? It turns out that the IVS Council and the Appraisal Foundation that publishes the USPAP standards have collaborated on establishing a bridge between the IVS and USPAP standards. This enables you to comply with both standards quite easily.
So now you can value businesses that operate within a single jurisdiction or stretch across the globe. Because the business valuation standards such as IVS let you communicate your results with confidence to a global audience.