Types of Valuation Engagements and Related Reports

When valuing a business or an asset, a valuation professional may express the determined value using various reporting requirements based on the nature and scope of the engagement.

Valuation Engagement

A Valuation Engagement requires that a member apply valuation approaches or methods deemed in the member’s professional judgment to be appropriate under the circumstances and results in a Conclusion of Value. Based on the valuator's credentials and related accreditation organization, you may find the valuation reports being referred to by different names.

Reports derived from a Valuation Engagement will typically be referred to by one of the following titles:

• Detailed Report
• Summary Report

As inferred by the names of the reports, a Summary Report provides an abridged version of the information that would be provided in a Detailed Report. Others names of reports you may hear that fall under a Valuation Engagement include, but are not limited to, Appraisal Report, Comprehensive Report, Full Report or Formal Report.

Calculation Engagement

The primary difference between a Valuation Engagement and a Calculation Engagement is that a Calculation Engagement occurs when the client and member agree to specific valuation approaches and methods. The extent of the selected procedures and results are expressed in a Calculated Value.

Reports derived from a Calculation Engagement will typically be referred to as a Calculation Report. Other report names you may hear that fall under a Calculation Engagement include, but are not limited to, Limited Report or Informal Report.

Consulting Engagement

There are other valuation engagements for which there may not be a need for one of the reports noted above. These services may include general consulting services, fraud and damage determinations, and other non-valuation services. For these types of engagements, the valuation expert is required to abide by the general and ethical standards but the development of the business or asset value and the related report are not subject to the published development and reporting requirements.

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