The business world is shrinking as businesses in every sector make the shift from regional market participants to international companies.
But as companies creep across borders, complexities are introduced. Regional differences can create obstacles to what were previously routine business practices. Business valuations is an example of a process with regional differences that can have a huge impact on a business’s reporting and its bottom line.
The valuations that underpin transactions are the pillars of the economy and have broad impacts on a business’s success. Any doubt cast on the accuracy of a valuation could send stocks plunging as investors look for less risky opportunities.
Valuations are done on all assets from a single-family home, the balance sheet of a publicly-traded company, a Picasso or a maritime vessel. Increasingly, the global nature of transactions emphasizes the need for consistency – across all asset types. Until recently, there was no consistency for business valuations and industry professionals had no regulating body to distinguish experienced professionals who follow best practices from those who lack the experience and know-how to assign accurate fair values.
As financial reporting has undergone added scrutiny since the 2008 financial crisis, investors, regulators and the public are seeking a level playing field when looking to assess risk and make sound decisions. RICS worked with other professional bodies to develop required performance framework standards on which we can regulate and thus strengthen public trust in valuations for financial reporting purposes. Professionals with the experience and knowledge to do business valuations can set themselves apart from others in the industry by achieving the Certified in Entity and Intangible Valuations (CEIV) through RICS.
Professionals looking to advance their careers in the business valuation space must meet minimum business experience and education requirements and they must pass the CEIV exam in order to qualify for the CEIV credential. Once the credential is attained, the qualified professional must complete annual continuing education specific to fair value measurement and submit to ongoing quality monitoring to ensure valuations continue to meet the standards.
RICS has been an enthusiastic supporter of international standards and the convergence of, at times, disparate applications of local standards. Our work with business valuations continue this tradition of working with partner organizations to build international standards for an increasingly international market. In all cases, we’re committed to increasing transparency, strengthening public confidence and ensuring consistent delivery.
Head of Regulation, Americas
Michael oversees the RICS Regulatory function in the Americas, ensuring that members carrying the designation comply with the Rules of Conduct and professional and ethical standards.
Michael has over a decade of experience in management and compliance and prior to coming to RICS in 2012 served as Director of Compliance for one of New York City’s largest non-profit housing providers.
Michael has served on numerous state and city-wide boards focusing on compliance and quality management. Michael holds a master’s degree in Public Administration.