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LESSONS LEARNT FROM ADOPTION OF IVS
BY ANEVAR
Dana ABABEI, ANEVAR President
TIJUANA, October, 2018
ANEVAR National Association
of Romanian Authorised Valuers
TIJUANA, October, 2018
ROMANIA – member of European Union
TIJUANA, October, 2018
STANDARDS TODAY
• Emerging markets need standards more than any other markets
• Standards will make investors more confident
• Main issue is now enforcing the standards
• Strong and credible professional body
• Make public to believe and defend standards
• Training the valuers and the public
• Involve the law makers
TIJUANA, October, 2018
ROMANIAN EXPERIENCE ON VALUATION
• Privatization based on valuation of the companies
• ANEVAR established in 1992 as a fully independent association of valuers in Romania with no Government backing or interference
• Main goal was seeking public recognition
• Organized for valuation of all type of property
• Is only valuer’s organisation in Romania
TIJUANA, October, 2018
ROMANIAN EXPERIENCE ON VALUATION
• In 1994 published its own technical standards based on the IVS and TEGoVoFA standards
• In 2003 adopted IVS as a basis of the national standards
• In 2012 the Valuation Law stated that ANEVAR will develop, approve and publish the Romanian Standards for Asset Valuation
TIJUANA, October, 2018
ANEVAR TODAY
Covers 5 valuation specialties: • Real property – 3714 individuals
• Business and intangible assets – 1688 individuals
• Machinery and Equipment – 1577 individuals
• Financial Instruments – 38 individuals
• Valuation Review – 119 individuals
TIJUANA, October, 2018
ANEVAR TODAY
• Has more than 4100 individual members and 540 corporate members
• Is member of TEGoVA (1994) IVSC(1996) WAVO (founding member)
• Represents Romania in the management board of: • TEGoVA for 12 years
• IVSC for 9 years
• WAVO for 17 years
TIJUANA, October, 2018
ANEVAR TODAY
• Develops, approves and publishes: • Technical Standards -SEV
• Guidance Notes - GEV
• Advisory Guidelines - IE
• Since 1995 has own Research Institute on Valuation - IROVAL
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ANEVAR TODAY • Publishes: “The Valuation Journal”, “Value- whenever it is”
magazine and Newsletter
• It is present on social media: Web, Facebook and Tweeter
TIJUANA, October, 2018
ANEVAR STANDARDS
• ANEVAR is empowered by law as a Valuation Standards Setter in Romania
• The 2018 Standards for Assets Valuation in Romania includes: • Valuation Standards – SEV - mandatory
• Guidance Notes – GEV - mandatory
• Advisory Guidelines – IE - recommended
TIJUANA, October, 2018
ANEVAR STANDARDS
• Romanian SEVs incorporate: • all IVSs ,
• some EVSs in the areas not covered by IVSs: • EU Law requirements:
• EVA 5 – Application of Investment Value (worth ) for individual Investors
• EVA7 –Property valuation in the context of the Alternative Investment Fund Managers Directive
• EVA 8 - property valuation and energy efficiency
• EVA 4 Assessment for insurable value and damage
TIJUANA, October, 2018
ANEVAR STANDARDS
• ANEVAR developed standards – to harmonize the standards to Romanian Law: • SEV 232 – Valuation of Trade Related Properties
• SEV 400 - Valuation review
• ANEVAR Guidance Notes with the best practice in applying the valuation standards • GEV 500 - Determination of the Taxable value of the buildings
• GEV 630 - Real estate valuation
• GEV 600 - Business Valuation
• GEV 620 - Valuation of personal Property such as machinery, plant , equipment and inventories
• GEV 520 - Valuation for secure lending
TIJUANA, October, 2018
ANEVAR ADVISORY GUIDLINES
• Advisory Guidelines – IE – recommended • Valuation of cultural goods
• Intangible assets valuations (IVS-TIP)
• Discounted cash flow (IVS-TIP)
• Cost approach of fixed assets (IVS-TIP)
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ANEVAR DOCUMENTS
• Professional Standard (Code of Ethics)
• Principles in line with IVSC and TEGoVA Codes of Ethics • Integrity
• Objectivity, independence, impartiality
• Confidentiality
• Competence
• Professional behavior
TIJUANA, October, 2018
WHY IVS?
• IVSs are principle based standards
• IVSs covers real property, business, intellectual property, machinery and equipment, financial instruments
• USPAP is focused on US’ laws
• EVS is focused only on real property
TIJUANA, October, 2018
WHY IVS?
• ANEVAR want to be part of a globalised world of valuers
• ANEVAR want to be recognised as organisation that apply universally recognised valuation standards by the investors and public
• ANEVAR don’t want to rediscover the “wheel”
TIJUANA, October, 2018
WHY IVS?
• IVSC recommends Valuation Professional Organisations (VPO’S) to develop methodological documents (guidance) in application of IVS
• The IVSs seek to be global standards and cannot cover the specificity of every country
• ANEVAR developed own documents since 2012
• Other countries did the same: UK, Canada, Australia, New Zeeland, Serbia, Russia
TIJUANA, October, 2018
WHY IVS?
• IVS can be applied in emerging market economies
• The IVS valuation principles are based on economic laws and are applicable everywhere
• The methodology developed by VPO’s should not be contradictory with IVS
• The standards must be enforced by VPOs and regulators
TIJUANA, October, 2018
WHY IVS?
• IVSC – Standard Review Board has a plan to develop other documents to cover important issues in valuation: nonfinancial liabilities, discounting rate, extractive industries, early stage company valuation, biological assets, inventory
• The IVS due process is transparent and comprehensive and the resulted IVSs have more chance to be applied globally
• IVSC has established a good cooperation with IASB to achieve more coherence between IVSs and IFRSs
TIJUANA, October, 2018
ANEVAR -15 YEARS OF IVS APPLING
• The association is now recognized by the state and other the stakeholders as public utility association
• ANEVAR are now involved in working groups which solve valuers issues together with theorists and with practitioners at national, regional and European level.
• ANEVAR has, now, enough resources to develop documents (standards or recommendations) in order to harmonize the IVS and local laws.
• Based on 15 years of IVS application experience, ANEVAR is promoting IVS in East European contries
TIJUANA, October, 2018
Thank you!
TIJUANA, October, 2018
NATIONAL ASSOCIATION OF ROMANIAN AUTHORISED VALUERS
7 Scărlătescu, district 1 Bucharest, 011158, România
tel: +40 21 315 65 64, 05, fax: +40 21 311 13 40
[email protected], www.anevar.ro