BV profession needs a stronger connection to research

BVWireIssue #259-4
April 24, 2024

valuation profession news
business valuation profession, intangible assets, practice management

The business valuation profession needs to be more attuned to academic finance research, according to a letter to the editor of the ASA’s Business Valuation Review by Victor E. Jarosiewicz (Quid Valorem LLC). He is a valuation practitioner, former finance professor, and is the current chair of The Appraisal Foundation’s Business Valuation Resource Panel.

Disconnect: In his letter, Jarosiewicz wonders why “the large and growing body of finance research—on topics of central interest to valuations—go unmentioned” in the various business valuation publications. Much of this research could directly affect and possibly improve valuation practice, he writes, but all he sees are retreads of the same old body of knowledge. He asks, “[W]here is the new science, the new thinking that leads to new and improved solutions? Updating our BV body of knowledge with current research is a must if BV is to advance and to attract young new talent to the profession.”

Jarosiewicz proposes to resurrect a feature, “Valuation Research Notes,” that once appeared in the Business Valuation Review. BVWire agrees that there should be more awareness of academic research in the valuation profession, and we cover research when we come across it. The trouble is some of it can be difficult to read and challenging to connect with actual valuation practice.

On another matter, Jarosiewicz has some ideas (also in his letter) about attracting more young people to the profession by targeting colleges and universities. One is to revive an idea of establishing a degree-granting program in valuation. He asks for feedback on these issues and his suggestions.

Extra: Speaking of research, a quick search turned up a recent working paper of interest, “Financing and Valuation of Intangible Assets,” by Nicolas Crouzet and Yueran Ma (Northwestern University and University of Chicago). The paper is a review of financing arrangements for intangible assets, and it provides an assessment of the valuation methods in the financing context.

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