The Appraisal Institute in May announced the formation of a new certification organization: the International Center for Valuation Certification.
In October 2013, the Appraisal Institute announced three major strategic initiatives that have the potential to fundamentally reshape the global valuation profession:
- A new certification organization to establish a future generation of cross-disciplinary valuation professionals and to enhance their marketability in a competitive job environment;
- Proposed Standards of Valuation Practice that could serve as an alternative for valuation professionals where national or other standards are not required; and
- Expanded delivery of Appraisal Institute education, becoming more proactive in identifying and pursuing appraisal educational opportunities.
These strategic initiatives are creative and comprehensive. They will have a huge impact on the future of the global valuation profession.
New Certification Organization
First, the ICVC will confer cross-disciplinary valuation certifications to individuals who meet select criteria, while addressing current market needs and opportunities, advancing professionals and serving the public and clients.
The ICVC will demonstrate leadership in cross-disciplinary valuation principles, standards, methods and ethics.
The ICVC is an Illinois not-for-profit organization. Its first Board of Directors consists of:
- Richard L. Borges II, MAI, SRA, AI-RRS;
- Charles T. Cowart, MAI;
- Jeffrey S. Enright, MAI;
- James L. Murrett, MAI, SRA;
- Misty K. Ray, MAI;
- Faith A. Roland, SR/WA; and
- Sara W. Stephens, MAI.
Standards of Valuation Practice
Second, the Appraisal Institute will issue proposed standards of valuation practice that could serve as an alternative for valuation professionals when current national or other standards are not required. These standards could be used when Uniform Standards of Professional Appraisal Practice, International Valuation Standards or other standards are not required and the use of the proposed standards would be appropriate.
Further, they would serve as an alternative set of standards that could be used independently, and not as an additional set of required standards. The proposed standards would not supplant USPAP or other national standards.
The Appraisal Institute already has released two Exposure Drafts of the proposed Standards of Valuation Practice and sought input and comment on them. It now is considering what changes to make, if any, to the Second Exposure Draft and likely will consider adopting the Standards later this year.
The Appraisal Institute is the historic leader in establishing standards for the valuation profession. The Appraisal Institute’s two predecessor organizations, which unified in 1991, were among the first to establish standards for the valuation profession; the American Institute of Real Estate Appraisers created standards in 1932 and the Society of Real Estate Appraisers did so in 1936. AIREA and the Society regularly revised and strengthened their Standards over the decades that followed.
State laws and regulations require that most valuers in the United States comply with USPAP in much or all of their valuation practices. For example, state licensed and certified valuers in "mandatory" states must comply with USPAP in their practices unless they are performing an exempted service. State licensed valuers in "voluntary" states must comply with USPAP in federally related lending transactions, at a minimum. Sometimes, however, valuers in the United States can, in addition to or as an alternative, comply with other standards. One example of such standards is the Uniform Appraisal Standards for Federal Land Acquisition (the "Yellow Book").
An example of a situation where the proposed Standards of Valuation Practice could be used is in an assignment in a non-mandatory state that does not involve a federally related transaction (e.g., valuation for financial reporting, certain litigation related assignments) and where USPAP is not otherwise required. The valuer would identify the Standards used in his or her engagement letter and report.
Expanded Education Delivery
Third, the Appraisal Institute also is expanding its delivery of Appraisal Institute education through a wider number and scope of providers, becoming more proactive in identifying and pursuing educational opportunities. By expanding its education delivery, the Appraisal Institute is strengthening its position as the leader in appraiser education; increasing the exposure of AI and its consistent, high-quality education; expanding the recognition of AI and its professionals; increasing awareness and interest in the valuation profession; and strengthening AI’s relationships with other organizations. As part of this initiative, Colliers International Brazil recently accepted AI’s proposal to offer designation level education courses to its staff appraisers, including "Advanced Income Capitalization," "Advanced Market Analysis and Highest & Best Use," "Advanced Concepts & Case Studies" and "Quantitative Analysis."
The Appraisal Institute will announce additional details of each of the three strategic initiatives in the near future.
Ken P. Wilson, MAI, SRA, is the 2014 president of the Appraisal Institute, the nation’s largest professional association of real estate appraisers. Based in Chicago, the Appraisal Institute has nearly 22,000 professionals in almost 60 countries
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