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Business Valuation Standards

Business Valuation Standards are guidelines and best practices established to ensure the consistency, accuracy, and credibility of business valuations. These standards are set by professional organizations such as the American Society of Appraisers (ASA), the International Valuation Standards Council (IVSC), and the Appraisal Foundation. They outline the methodologies, procedures, and ethical considerations that appraisers must follow when determining the value of a business or its assets.

Example

An appraiser valuing a privately held company for a potential sale would follow business valuation standards to ensure that the valuation is conducted using accepted methods and principles, providing a fair and accurate assessment.

Key points

• Business Valuation Standards provide guidelines for consistent and accurate business valuations.

• Set by professional organizations to ensure reliability and compliance.

• Essential for legal, financial, and regulatory purposes.

Quick Answers to Curious Questions

They ensure that business valuations are conducted consistently, accurately, and fairly, providing reliable information for decision-making and compliance.

Standards are set by professional organizations like the American Society of Appraisers (ASA) and the International Valuation Standards Council (IVSC).

An appraiser must adhere to these standards to conduct credible and defendable valuations that meet legal and regulatory requirements.