Overview of the Mandatory Performance Framework

CE 2 | Business Valuation

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Webinar Description

Competition between appraisers to obtain valuation projects and the lower valued added nature of many financial reporting valuations can lead to significant fee competition to obtain valuation assignments. Price competition and low project fees can increase the risk that appraisers may not perform adequate valuation due diligence in completing projects. USPAP provides high level standards on the sufficiency of procedures required to complete an appraisal. To help appraisers perform and report projects with an adequate degree of effort, a Mandatory Performance Framework ("MPG") document is being developed to provide guidance for certain financial reporting valuations. This webinar reviews USPAP standards as well as elements of draft MPF that has been developed.

Learning Outcomes

Upon webinar completion, the participant will be able to:

1. Recognize key elements of USPAP valuation standards and their relationship to Mandatory Performance Framework (MPF).
2. Understand the purpose / scope of MPF.
3. Discuss documentation requirements for a valuation report and a valuation work file.
4. Explain concepts of professional skepticism, evidence-skepticism and self-skepticism.
5. Recognize areas of business valuation subject matter guidance.
6. Describe MPF and documentation requirements for:

  • Analysis of Prospective Financial Information
  • Discount Rate Derivation
  • Growth Rates
  • Terminal Value Multiple Methods/Models
  • Selection of, and Adjustments to, Valuation Multiples
  • Selection of Guideline Public Companies or Comparable Company Transactions
  • Discount and Premiums

Webinar Audience

This program will be of interest to all individuals that perform or review business valuations. While the focus is on pending financial reporting requirements, appraisers that perform tax and litigation valuations may also find the developments relevant in their valuation practices.

Instructor Information

Raymond Rath, ASA | Managing Director | Globalview Advisors LLC 

Ray Rath, ASA, CFA, is a Managing Director with Globalview Advisors LLC, an independent valuation firm with offices in Irvine, Boston and London. Ray led the developments of the ASA's two courses in intangible asset valuation. Ray has worked closely with fixed asset and real estate appraisers on purchase price allocation and other multi-discipline projects for over thirty years. Ray holds ASA designations in Business and Intangible Asset valuation and Appraisal Review and Management.

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Disclaimer: The opinions expressed in this presentation are that of the presenter(s) and do not necessarily reflect the views and opinions of the American Society of Appraisers.

Questions? Contact ASA Education Team at Education@appraisers.org

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