Who is a registered valuer?
A registered valuer is an individual or entity which is registered with the Insolvency and Bankruptcy Board of India (IBIBI) as a valuer in accordance with the Companies (Registered Valuers and Valuation) Rules, 2017. Under Section 458 of the Companies Act, IBBI has been specified as the authority by the central government.
The concept of registered valuer was introduced in the Companies Act in 2017 in order to regulate the valuation of assets and liabilities linked to a company and to standardise the valuation procedure in line with global valuation standards.
Experts say that before the concept of registered valuer became part of the Companies Act, valuation was done in an arbitrary manner, often leading to question marks over the authenticity of the valuation.
What does the valuation report comprise?
As per the Companies (Registered Valuers and Valuation) Rules, 2017, the valuer should, in his/its report, state 11 key aspects including disclosure of the valuer’s conflict of interest, if any. Among others it must include: purpose of valuation; sources of information; procedures adopted in carrying out the valuation; valuation methodology; and major factors that influenced the valuation.
Who can become a registered valuer?
An individual needs to clear the Valuation Examination conducted by IBBI.
An individual, who has (a) specified qualification and experience (Graduate in a specified discipline with five years’ experience or postgraduate in a specified discipline with three years’ experience); (b) is enrolled as a valuer member with a registered valuers organisation (RVO); (c) completed the educational course conducted by the RVO, and (d) passed the examination of the relevant asset class, conducted by IBBI, is eligible for registration with IBBI as a registered valuer. There is no exemption from the examination irrespective of qualification, experience, or age.
The individual should, however, have a postgraduate degree in the specified discipline (relevant for valuation of the class of asset for which the registration is sought) and should have at least three years of experience in the discipline thereafter.
As of November 25, 2021 there were 4,472 individuals registered as valuer and only 56 registered as valuer entities with IBBI.
