The CICBV recently posted a research paper that examines the global differences in business valuation theory and methodology. The paper, “Around the World in Eighty Valuations,” was written by Prem M. Lobo and Matt Bottomley, finds that, “on balance, there are geo-professional differences in the approach to and the application of business valuation theory and methodology around the world.” The authors note that there are a number of differences with respect to valuation reports, including the level of detail used, the degree of disclosure of key assumptions and scope limitations, whether conclusions are arrived at by averaging different methods or using one method, among others.
Independence issues: The authors say they are “concerned” that they found that arbitrators have a “generally skeptical view” of valuation experts and their reports. “This is certainly not a view that the valuation profession should allow to linger,” they write. The authors recommend that additional standards addressing ethics and independence would help.
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