BV experts must be critical and skeptical of their own work, explained Frank Rosillo of The Valuations & Forensics Advisory. During a session at NACVA and the IBA’s 2009 Consultants Conference in Boston, entitled “How to Set up an Effective Internal Review Process for your Appraisal Practice,” Rosillo told attendees that all work needs to be relevant and probative and they should be able to answer eight Quality Assurance Checklist questions about appraisal reports. Three representative questions are: 1) Does the appraisal report contain sufficient data, assumptions, and explanations to support the opinion of value in accordance with generally accepted appraisal practices in the USA? 2) Were methodologies properly applied? 3) Does the appraisal report meet applicable professional standards?

Know, too, that if you do not have an Internal Review Process, now is the time to create one. The reason: Odds are you will eventually be asked about your processes in court. On another note, Frank told attendees that he reviews a number of BV reports in his work and he finds the two things missing most often are 1) a balance sheet on the valuation date and 2) an analysis of working capital as of the valuation date and projections going forward. These are two “must have’s” for every report, he says. Look for more insights from Rosillo in an upcoming BVU article.