The American Institute of CPAs has partnered with the American Society of Appraisers and the Royal Institution of Chartered Surveyors on a new credential for financial professionals who provide fair value measurement services.
The AICPA, ASA and the RICS began working together on developing a single credential that offers a more consistent framework for fair value measurement. The organizations are striving to be sure financial professionals have the necessary training, qualifications, experience and expertise to perform the work. They released a proposed framework in 2016.
Financial professionals who receive the new Certified in Entity and Intangible Valuations (“CEIV”) credential would need to follow new uniform guidance on how much documentation is necesssary to support their fair value measurement results in company financial statements when they are producing valuations of entities and intangible assets such as trademarks, patents and technology, customer sales lists, and non-compete agreements.
The uniform guidance for the credential specifies the level of documentation necessary to enable investors, auditors and regulators to understand more easily how fair value measurement has been used to determine the values of businesses and intangible assets. The CEIV credential also requires regular monitoring of credential holders to make sure they’re following the new guidance.
To get the new credential, financial professionals need to meet certain eligibility requirements determined by the AICPA, ASA and the RICS, in collaboration with the Appraisal Foundation and the International Valuation Standards Council, which also helped develop the new credential. Those requirements include demonstrating competencies in valuation and fair value measurement through training and assessments, along with passing a two-part CEIV exam that will be introduced this year.
We here at Advent are always trying to proactively respond to clients’ needs and are watching the developments closely and, if necessary, will be obtaining the new credential.