- Purpose and Scope: The standards clarify the purpose of the valuation, whether it’s for investment, sale, accounting, or other specified purposes. They outline the responsibilities of valuers and emphasize the need for independent and impartial opinions.
- Ethics: International valuation standards emphasize the importance of ethical behavior and integrity in carrying out valuations. This includes maintaining independence, transparency, and confidentiality, as well as avoiding conflicts of interest.
- Definitions and General Principles: The standards provide precise definitions for key terms and establish general principles that guide the valuation process. They emphasize the importance of applying consistent and objective methodologies, using relevant data, and exercising professional judgment.
- Approaches to Value: Valuation standards outline different approaches to determine property value, including the sales comparison approach, income capitalization approach, and cost approach. They provide guidance on selecting and applying the most appropriate method based on the nature of the property and the purpose of the valuation.
- Data and Analysis: International valuation standards stress the significance of reliable data collection and analysis. They provide guidelines on researching and verifying property information, analyzing market trends, and evaluating comparable transactions. Report writing standards ensure that findings and analysis are clearly presented.
- Reporting: The standards provide guidelines for the structure, content, and format of valuation reports. They emphasize the importance of clarity, accuracy, and transparency in communicating valuation results. Documentation of supporting data, assumptions, limiting conditions, and qualifications is vital.
- Professional Development: International valuation standards advocate for continuous professional development and the improvement of valuation knowledge and skills. They encourage valuers to stay updated on industry developments, engage in professional networks, and seek ongoing education and training.
By adhering to international valuation standards, valuers can enhance their professionalism, provide accurate and reliable valuations, and instill confidence in clients, stakeholders, and potential investors. These standards contribute to the global harmonization of valuation practices and facilitate transparency, comparability, and market confidence.