Valuation VPS 2 Flashcards
What are assumptions in valuation?
Assumptions are made where it is reasonable for the valuer to accept that something is true without the need for specific investigation.
What is a special assumption?
A special assumption is a supposition that is taken to be true and accepted as fact, even though it is not verified.
It must be agreed with the client in writing at the commencement of the instruction.
What must valuers do according to VPS 2?
Valuers must take steps to verify the necessary information being relied upon for a valuation to ensure it is professionally adequate for its purpose.
What are restricted information valuations?
Restricted information (desktop) valuations are considered a Red Book Global valuation unless for specific purposes set out in PS1.
What factors should a valuer consider for restricted information valuations?
The valuer should consider the following four factors: 1) Nature of the restriction, 2) Possible valuation implications, 3) Reasonableness of the restriction, 4) Reference to the restriction in the report.
What is required for a revaluation without re-inspection?
A revaluation without re-inspection must not be undertaken unless the valuer is satisfied that there have been no material changes since the last inspection.
This must be confirmed in the terms of engagement and in the valuation report.
What records must be held by valuers?
Proper records must be held of inspections, investigations, and other key inputs in an appropriate business format.
What are the minimum requirements for valuation reports?
Minimum requirements include: 1) Nature of the restriction, 2) Valuation implications, 3) Reasonableness of the restriction, 4) Reference to the restriction in the report.
What is preliminary (draft) valuation advice?
Preliminary valuation advice can be given but must be marked as a draft, for internal purposes only, and cannot be relied upon or published.
What must a draft report state?
A draft report must state that it is a draft and is subject to completion.
The valuer must not be influenced by the client regarding the final valuation figure.
What should valuers consider regarding ESG and Sustainability?
Valuers should regard the relevance and significance of ESG and Sustainability factors, which should form an integral part of the valuation approach and reasoning.
