Additional Notes on PVS

1. GENERAL VALUATION CONCEPTS AND PRINCIPLES

1.1 The underlying fundamentals of property valuation provide the basis in the
development of the valuation standard for the Philippines. The Philippine Valuation
Standards are developed based on the generally accepted valuation concepts, principles
and procedures which are similar throughout the world. The draft of the Philippine
Valuation Standards is based on these fundamentals.

1.2 Property Appraisers and Assessors are those who deal with the special
discipline of economics associated with preparing and reporting valuations. As
professionals, Appraisers must meet rigorous tests of competence and training, and
demonstrate appraisal skills. They must also exhibit and maintain a Code of Ethics and
Conduct and follow the Standards of professional practice based on a set of General
Valuation Concepts and Principles (GVCP).

1.3 The Philippine Valuation Standards developed is patterned after valuation

standards of a number of international organizations and acknowledgement is made to
these various international organizations.

2.0 LAND AND PROPERTY CONCEPT

2.1 Land is one of the major factors of production which is supplied by nature
without the aid of man. Land may include not only the earth surface, both land and
water, but also anything that is attached to earth’s surface, including all natural
resources in their original state, such as mineral deposits, wildlife, timber.

2.2 Property rights in land are established on the theory that the rights in fee
simple ownership in land normally include the wedge shaped area downward from the
earth’s surface to the center of the earth (sub-surface rights) and the area upward from
the earth’s surface out into space (supra-surface or air rights). The latter is limited by
Act of Congress concerning public use of navigable air space which is considered in the
public domain.

2.3 Valuation of land as if vacant or of land and improvements on the land or for
the benefit of the land is an economic concept. Whether vacant or improved, land is also
referred to as real estate. Value is created by the real estate’s utility, or capacity to satisfy
the needs and wants of human societies. Contributing to value are the real estate’s
general uniqueness, durability, potential features of location, relatively limited supply,
and the specific usefulness of a given site.

2.4 All appraisals are concerned with property. Property is the inherent rights of
ownership and future benefits of tangible and intangible assets and is taken to mean
any right or interest reflecting a source or attribute of wealth. The word property, used
without further qualifications may refer to real property, personal property, or other
types of property such as businesses and financial interests, or a combination thereof.
Personal property pertains to movable physical assets. Anything that is not part of real
estate is personal property. Realty consists of land and all improvements on and to the
land. This term is synonymous with real estate. Real property consists of rights in realty.

2.5 The distinction between real property (rights in realty) and realty (the physical
thing) is significant, in that it is the real property rights that are transferred and valued
in the market and not the real estate.

2.6 The basic rights of private ownership of property include possession, control,
enjoyment, disposition or use, exclusion, plus the right not to exercise any of the above
rights. The term used to describe the full set of private ownership rights is “bundle”. The
“bundle of rights theory” states that these rights are both divisible and separable, i.e.
they may be exchanged in whole or in part. In every appraisal, it is necessary to identify
what rights, or what part of the total bundle, are appraised, i.e., which property rights is
to be appraised.

2.7 Estates are ownership rights and interest in property. The estate most
commonly appraised is the fee simple estate, or the fee simple absolute estate which is
the fullest type of private ownership possible. Fee simple is an estate without restrictions
but subject to the limitation of eminent domain, escheat, police power, and taxation.

2.8 Many recognized principles are applied in valuing real estate. They include the
principles of supply and demand; competition; substitution; anticipation; increasing and
decreasing return, balance, conformity, change; contribution and others. Common in all
these principles is their direct or indirect effect on the degree of utility and productivity
of a property. Consequently, it may be stated that the utility of the real estate reflects
the combined influence of all market forces that come to bear upon the value of property.

3.0 REAL ESTATE, PROPERTY, AND ASSET CONCEPTS

3.1 Real estate is defined as the physical land and all those items which are
attached to the land. It is the physical, tangible entity which can be seen and touched,
together with all the additions on, above, or below the ground. Philippine Australia Land
Administration and Management Project 4 Philippine law4 prescribes the basis for
distinguishing real estate from personal property. Although these legal concepts may not
be recognized, they are adopted here to distinguish important terms and concepts.

3.2 Real property includes all the rights, interests, and benefits related to the
ownership of real estate. Ownership of real estate is evidenced by a Certificate of Title,
Free Patent or Tax Declaration in the absence of Certificate of Title.
 3.3 Personal property includes interests in tangible and intangible items which
are not real estate. Items of tangible personal property are not permanently affixed to
real estate and are generally characterized by their own moveability.

3.4 Property such as plant, machinery and equipment are tangible or physical
assets which are intended to be used on a continuing basis as part of an enterprise.

3.5 Depreciation is loss in value brought about by physical deterioration and/or

obsolescence. Physical deterioration is loss in value due to wear and tear and exposure
to the elements. Obsolescence can either be functional or economic (environmental).
Functional obsolescence is loss in value within the property as a result of the
development of new technology, changes in design or market preferences. Economic
obsolescence is the loss in value resulting from influences external to the property itself.

4.0 COST, PRICE AND VALUE

4.1 In appraisal terminology, the terms cost, price and value are distinct and not
synonymous to each other. The specific meanings of these terms have to be distinguished
as they are used in the valuation discipline.

4.2 Cost is the amount of money necessary to produce, create or manufacture an

item of property. It includes material, labor, equipment, contractor’s overhead and
profits, and fees.

4.3 Price is the amount of money necessary to purchase the finished goods or item
of property manufactured when offered for sale in the open market.

4.4 Value exists when an item of property has utility, is relatively scarce, arouses
the desire of potential buyer to buy and backed by purchasing power. Value is an
economic concept referring to the amount most likely to be agreed upon by buyers and
sellers in an open market transaction. The economic concept of value reflects the
market’s view of the benefits that accrue to one who owns the good or receives the
services as of the effective date of valuation.

4.5 There are many types of value. In valuing property, it is of utmost importance
that the appraisers and the assessors use the type of value appropriate in the particular
appraisal engagement. Any change in the type and definition of the 4 Republic Act No.
386 as amended (Civil Code of the Philippines) Philippine Australia Land Administration
and Management Project 5 value can have material effect on the conclusion of value
assigned to property for the specific purpose. For real estate appraisal the most common
type of value is market value.

4.6 Market value estimate for replaceable property may be based on cost of
reproduction new or replacement cost. Cost of Reproduction is the cost to construct or
manufacture a replica property using the same design, materials and workmanship. A
replacement cost estimate envisions constructing or manufacturing a similar structure
having the same or comparable utility and using materials and design concept currently
used in the market.

5.0 MARKET VALUE

5.1 The concept of market value reflects the collective actions and reactions of
buyers and sellers in a typical open market. It is usually the basis for valuing real estate
property particularly for taxation purpose.

5.2 Market value is defined as the estimated amount for which a property should
exchange on the date of valuation between a willing buyer and a willing seller in an arm’s
length transaction (a transaction between independent, unrelated parties involving no
irregularity) after proper marketing wherein the parties had each acted knowledgeably,
prudently, and without compulsion.

5.3 Market value may also be expressed as the amount at which ownership of the
appraised property might be justified by a prudent investor or alternatively as the present
worth of future benefits of ownership.

5.4 It is important to emphasize that market value is an objective estimate of the

identified rights of ownership under the Bundle of Rights Theory and as of the specific
date of appraisal. It is a market supported estimate developed in accordance with the
Philippine Valuation Standards.

6.0 HIGHEST AND BEST USE

6.1 Real Estate is valued on the basis of the rights inherent in the ownership
(Bundle of Rights) rather than the physical land. Consequently, in the appraisal of land
whether vacant or improved, the maximum benefits of ownership must be analyzed.

6.2 When improved land is valued separately from the improvement, economic
principles require that the improvements be analyzed and valued based on whether they
contribute to the total value of the property or detract from it (Principles of Contribution).
Therefore, market value of land is analyzed as if the land is vacant and available for use
and development in accordance with the “Highest and Best Use” concept. Philippine
Australia Land Administration and Management Project 6

6.3 When improved land is valued as a property unit (combination of land and
improvements), market value is estimated by considering the highest and best use of the
property as improved.

6.4 Highest and Best Use is defined as: The most probable use of property which
is physically possible, appropriately justified, legally permissible, financially feasible, and
which results in the highest value of the property being valued.
 6.5 A use that is not legally permissible or physically possible cannot be
considered a highest and best use. A use that is both legally permissible and physically
possible may nevertheless require an explanation by the Appraiser/Assessor justifying
why that use is reasonably probable. Once analysis establishes that one or more uses
are reasonably probable uses, they are then tested for financial feasibility. The use that
results in the highest value, in keeping with the other tests, is the highest and best use.

7.0 UTILITY

7.1 The key criterion in the valuation of any real or personal property is its utility.
Procedures employed in the valuation process have the common objective of defining and
quantifying the degree of utility or usefulness of the property valued. This process calls
for interpretation of the utility concept.

7.2 Utility is a relative or comparative term, rather than an absolute condition.

For example, the utility of agricultural land is ordinarily measured by its productive
capacity. Its value is a function of the quantity and quality of produce, which the land
will yield in an agricultural sense, or of the quantity and quality of buildings essential to
the agricultural operation. If the land has development potential, however, its
productivity is measured by how productively it will support a residential, commercial,
industrial, or mixed use. Consequently, land value is established by evaluating its utility
in terms of the legal, physical, functional, economic, and environmental factors that
govern its productive capacity.

7.3 Fundamentally, property valuation is governed by the way specific property is

used and/or how it would ordinarily be traded in the market. For some property,
optimum utility is achieved if the property in question is operated on an individual basis.
Other property has greater utility if operated as part of a group of properties, e.g.,
properties owned and managed by a business enterprise such as a chain of multiple
retail outlets, fast food restaurants, or hotels. Therefore, a distinction must be made
between a property’s utility viewed individually and when considered as a part of a group.
The Appraiser/Assessor will regard the property as the market views it, whether as a
discrete entity or as part of an aggregate or portfolio. Typically, the Appraiser/Assessor
determines the value of the property as an individual entity. If the value of the property,
taken as part of an aggregate or portfolio is other than its individual value, such value
should be considered. Philippine Australia Land Administration and Management Project
7

7.4 A common effect of political or economic uncertainty is a change in utility,

whether in terms of capacity or efficiency. The Appraiser’s/Assessor’s responsibility in
such situations is to assess the market expectancy of the time span for such events.
Temporary shut-downs or closures may have little or no impact on property values,
whereas prospects for long-term cessation of activities may result in a permanent
diminution in value. The property valued must be viewed in the light of all internal and
external factors bearing on its operating performance.

8.0 SPECIAL PURPOSE PROPERTY

8.1 Special purpose properties are properties which are designed, constructed and
developed for a specific use or purpose. By its very nature this type of property is rarely
offered for sale in the open market except as part of a going concern. Because of the
special design and function, conversion of special purpose properties to other types of
development or application is generally not economically feasible. 8.2 In valuing special
purpose properties, it is the Appraiser’s/Assessor’s responsibility to gather pertinent
data and information and develop sound reasoning from the market to support
conclusions of value. While all the appraisal methods should be considered, the Cost
Approach to value is commonly applied in the appraisal of special purpose properties.

9.0 APPROACHES TO VALUE

9.1 Valuation of any type of property for any application including taxation
purposes requires that the Appraiser/Assessor apply one or more valuation approaches.
The term valuation approach or methodology refers to generally accepted analytical
methodologies that are in common use internationally.

9.2 There are three generally accepted methods of estimating fair market value
cost, market and income.

9.2.1 The Cost Approach to value considers the cost to reproduce the
property appraised. From this amount is deducted an allowance for depreciation or
obsolescence present, whether arising from physical, functional or economic causes.
This approach in appraisal analysis is based on the proposition that an informed
purchaser would pay no more for a property than the cost of producing a substitute
property with same utility as the subject property. Cost approach is particularly
applicable to relatively new property and to unique or special purpose property.

9.2.2 The Market Approach considers prices recently paid for comparable
assets. Appropriate adjustments are made in the indicated market prices of similar
property to reflect the condition and utility of the Philippine Australia Land
Administration and Management Project 8 appraised property relative to the actual or
normal market comparative. This approach in appraisal analysis is based on the
proposition that an informed purchaser would pay no more for a property than the cost
in acquiring an existing property with the same utility. Market approach is particularly
applicable when there is an active market with sufficient quantities of reliable data which
are verifiable from authoritative sources. It is relatively unreliable when market is
limited.

9.2.3 In the Income Approach, an estimate is made on the prospective

economic benefits of ownership. This approach is predicated on the proposition that an
informed purchaser would pay no more for a property than the cost of obtaining an
income stream of the same size and embodying the same risk as that involved in the
subject property. Income approach is particularly applicable when the future benefits of
ownership may reasonably be estimated in the light of related risk to be incurred.

9.3 The Appraiser/Assessor must consider application of each of the three

approaches in every appraisal. The approaches selected must be supported by the facts
and circumstances of the case on hand. The applicability of any approach in a given
valuation problem depends on the character of the problem, the type of property involved,
the nature of the market, and of course the availability of required data appropriate
quality and in sufficient quantity.

Code of Conduct

1.0 Introduction

It is fundamental to the operation of International Valuation Standards that

valuations performed in compliance therewith should be provided by honest and
competent Professional Valuers, free of bias or self-interest, whose reports are clear, will
not mislead, and will disclose all matters essential to the proper understanding of the
valuation. Valuers should always promote and preserve public trust in the valuation
profession.

Philippine 1.1
Private Sector realty services practitioners comprising real estate salesmen, real
estate brokers, real estate appraisers and real estate consultants are currently regulated
by the National Code of Ethics for Real Estate Service Practitioners (NCERESP) which are
complementary to this Code of Conduct.

Philippine 1.2
The Public Sector, and particularly Assessors and their staff, must:
i) Promote and preserve public trust inherent in the assessment service;
ii) Maintain a high standard of honesty and integrity and conduct their activities in a
manner not detrimental to the government, the public and their profession; and
iii) Ensure that all of their staff, persons or subordinates adhere to this Code of Conduct.

2.0 Scope

2.1 Valuers comply with these Standards either by choice or by requirement

placed upon them by law or regulation or at the instructions of clients, intended users,
and/or national societies or organizations. A valuation claiming to be prepared under
International Valuation Standards binds the Valuer to follow this Code of Conduct.
 2.2 This Code does not have any formal authority in law, neither is it intended to
be other than complementary to the rules, by-laws and regulations of national societies
or organizations controlling or monitoring the activities of the Valuers.

2.3 Valuations prepared under these Standards would only normally be

acceptable to end users when prepared by a trained professional member of a recognized
national professional body that itself enforces standards of qualification, competence,
experience, ethics, and disclosure in valuation. In those countries where the
infrastructure does not yet exist for a trained and regulated profession of valuation,
primary responsibility lies with the client users to satisfy themselves as to the suitability
of Valuers to undertake the task.

3.0 Definitions

3.1 Assumptions are suppositions taken to be true. Assumptions involve facts,

conditions, or situations affecting the subject of, or approach to, a valuation but which
may be capable or worthy of verification. They are matters that, once declared, are to be
accepted in understanding the valuation. All assumptions underlying a valuation should
be reasonable.
All valuations are dependent to some degree on adoption of assumptions. In
particular,
the definition of Market Value incorporates assumptions to ensure consistency of
approach and the Valuer may need to make further assumptions in respect of facts which
Philippine Valuation Standards (1st Edition) – Adoption of the IVSC Valuation Standards
under Philippine Setting Code of Conduct 23 cannot be known or facts which could be
determined3.2 Limiting Conditions are constraints imposed on valuations.

Limiting conditions may be imposed:

By clients (e.g., where the Valuer is not permitted to investigate fully one or more
of the significant factors likely to affect valuation);

By the Valuer (e.g., where the client may not publish the whole or any part of the
valuation report or valuation certificate without the Valuer‘s prior written approval of the
form and context in which it may appear); or

By local statutory law.

3.3 A Valuer is a person who possesses the necessary qualifications, ability, and
experience to execute a valuation. In some countries, licensing is required before a
person can act as a Valuer.

The Valuer shall be a person of good repute who:

has obtained an appropriate degree at a recognized center of learning, or an equivalent
academic qualification;

has suitable experience and is competent in valuing in the market and category of the
asset;

is aware of, understands, and can correctly employ those recognized methods and
techniques that are necessary to produce a credible valuation;

is a member of a recognized national professional valuation body;

pursues a programme of professional learning throughout his or her career; and

follows all the requirements of this Code of Conduct.

If, in any country, there are no appropriate academic qualifications as stated above, the
Valuer should have a sufficient level of training and experience in the valuation and be
either:
a member of a recognized national professional valuation body;
or licensed by government or appointed by the Courts or an Authority of an equivalent
status.
In some countries, to practice as a Valuer a license or certification by an independent
body is required by law.

3.4 An Internal Valuer is a Valuer who is in the employ of either the entity that
owns the assets or the accounting firm responsible for preparing the entity‘s financial
record and/or reports. An Internal Valuer is generally capable of meeting all the
requirements of independence and professional objectivity required under this Code of
Conduct, but for reasons of public presentation and regulation may not always be
acceptable to fill the role of independent Valuer in certain types of assignments.

3.5 An External Valuer is a Valuer who, together with any associates, has no
material links with the client, an agent acting on behalf of the client, or the subject of
the assignment.

3.6 Since all Valuers undertaking assignments under International Valuation Standards
must meet the requirements of impartiality, professional objectivity and disclosure
required under this Code of Conduct, such Valuers should meet the requirements for
independence which may attach to many assignments. With some clients, and in certain
countries, additional restraints on who may undertake a valuation for a specific purpose
may be applied by regulation or law. It is not the purpose of
Philippine Valuation Standards (1st Edition) – Adoption of the IVSC Valuation Standards
under Philippine Setting Code of Conduct 24 this Code to define different degrees of
independence beyond the standard of independence already required under this Code.

4.0 Ethics

Valuers should at all times maintain a high standard of honesty and integrity and
conduct their activities in a manner not detrimental to their clients, the public, their
profession, or their respective national professional valuation body.

4.1 Integrity

4.1.1 A Valuer must not act in a manner that is misleading or fraudulent.

4.1.2 A Valuer must not knowingly develop and communicate a report that contains
false, inaccurate, or biased opinions and analysis.

4.1.3 A Valuer must not contribute to, or participate in, a valuation service that other
reasonable Valuers would not regard to be ethical or justified.

4.1.4 A Valuer must act legally and comply with the laws and regulations of the country
in which he or she practices or where an assignment is undertaken.

4.1.5 A Valuer must not claim, or knowingly let pass, erroneous interpretation of
professional qualifications that he or she does not possess.

4.1.6 A Valuer should not knowingly use false, misleading or exaggerated claims or
advertising in an effort to secure assignments.

4.1.7 A Valuer shall ensure that any staff person or subordinate assisting with the
assignment adhere to this Code of Conduct.

4.2 Conflicts of Interest

4.2.1 A Valuer must not act for two or more parties in the same matter, except with the
written consent of those concerned.

4.2.2 A Valuer must take all reasonable precautions to ensure that no conflicts of duty
arise between the interests of his or her clients and those of other clients, the Valuer, his
or her firm, relatives, friends, or associates. Potential conflicts should be disclosed in
writing before accepting instructions. Any such conflicts of which the Valuer
subsequently becomes aware must be disclosed immediately. If such conflicts come to
the attention of the Valuer after completion of the valuation, disclosure must be made
within a reasonable time.

4.3 Confidentiality

4.3.1 A Valuer must at all times deal

with client‘s affairs with proper discretion and confidentiality.

4.3.2 A Valuer must not disclose sensitive factual data obtained from a client, or the
results of an assignment prepared for a client, to anyone other than those specifically
authorized by the client except when legally required to do so as in situations where a
Valuer must comply with certain quasi-judicial proceedings within the recognized
national professional valuation body of which the Valuer is a member.

4.4 Impartiality

4.4.1 A Valuer must perform an assignment with the strictest independence, objectivity,
and impartiality, and without accommodation of personal interests.

4.4.2 A Valuer must not accept an assignment that includes the reporting of
predetermined opinions and conclusions.

4.4.3 Fees connected with an assignment must not depend on the predetermined
outcome of any valuation or other
Philippine Valuation Standards (1st Edition) – Adoption of the IVSC Valuation Standards
under Philippine Setting Code of Conduct 25 independent, objective advice contained in
the valuation report.

4.4.4 Whether the Valuer‘s fee is or is not contingent upon any aspect of the report must
be disclosed.

4.4.5 A Valuer must not rely upon critical information supplied by a client, or any other
party, without appropriate qualification or confirmation from an independent source
unless the nature and extent of such reliance is specified as a limiting condition.

4.4.6 A Valuer should not accept an assignment to report on assumed hypothetical

conditions that are unlikely to be realized in any reasonable timescale.

4.4.7 Hypothetical conditions that are a reasonable possibility may be reported on

provided they are accompanied by some discussion both of the prospects of realizing the
hypothesis and a consideration of value that reflects the true situation prevailing, e.g., a
situation where a client wants to know what the value of land will be pending
detoxification.

4.4.8 A Valuer should not use or rely on unsupported conclusions based on prejudice of
any kind or report conclusions reflecting an opinion that such prejudice is necessary to
maintain or maximize value.

4.4.9 In reviewing another Valuer‘s report, a Valuer shall exhibit impartial judgment and
justify his or her reasons for agreeing or disagreeing with the conclusion of the report.

5.0 Competence
A Valuer must have the knowledge, skill, and experience to complete the assignment
efficiently in relation to an acceptable professional standard. Only those Valuers able to
conform to the definition of the Valuer set out in Definitions (para. 3.3 above) should
undertake work in connection with these Standards.

5.1 Acceptance of Instructions

5.1.1 Prior to accepting an assignment or entering into an agreement to perform any

assignment, a Valuer must properly identify the problem to be addressed and be certain
he or she has the experience and knowledge, or in the event of an assignment overseas,
will be able to associate with a professional possessing the experience and knowledge of
the market forces, language, and law to complete the assignment competently.

5.2 Outside Assistance

5.2.1 When engaging the services of outside assistance necessary to complement a

Valuer‘s own skills, a Valuer should first establish that those assisting have the requisite
skills and ethical principles.

5.2.2 The client‘s consent should be obtained when outside assistance is required, and
the identity of the assistants and extent of their role should be disclosed in the Valuer‘s
report.

5.3 Efficiency and Diligence

5.3.1 Valuer should act promptly and efficiently in carrying out the client‘s instructions
and should keep the client informed of the Valuer‘s progress.

5.3.2 Instructions should be declined where circumstances preclude sufficient diligent

enquiry, quality of work, and completion within a reasonable time.

5.3.3 Before the valuation is reported, written instructions should be received from the
client and/or confirmed in writing by a Valuer in sufficient detail to avoid any
misinterpretation.

5.3.4 A Valuer should make diligent enquiries and investigations to ensure that
Philippine Valuation Standards (1st Edition) – Adoption of the IVSC Valuation Standards
under Philippine Setting Code of Conduct 26
the data for analysis in the valuation are correct and can be relied upon.

5.3.5 A Valuer should prepare a work file for each assignment which, upon completion,
should contain a true copy, in paper or electronic form (suitably backed-up), of all written
reports, correspondence, and memoranda plus adequate file notes which substantiate
the Valuer‘s opinion by way of enquiry, objective comparison, deduction, and calculation.

5.3.6 The work file for each assignment should be retained for a period of at least five
years after completion of the assignment.

6.0 Disclosure

It is essential that Valuers develop and communicate their analyses, opinions, and
conclusions to users of their services through reports that are meaningful and not
misleading and that disclose anything that might be taken to affect objectivity.
6.1 The valuation report should set out a clear and accurate description of the scope of
the assignment and its purpose and intended use, disclosing any assumptions,
hypothetical scenarios, or limiting conditions that directly affect the valuations and,
where appropriate, indicating their effect on the value.
6.2 The valuation report must provide sufficient information to describe the work
performed, the conclusions reached, and the context in which they were shaped.

6.3 A Valuer must disclose any direct or indirect personal or corporate relationship with
the property or company that is the subject of any assignment and that might lead to a
potential conflict of interest.

6.4 Where a Valuer is acting as an Internal Valuer, the relationship with the entity
controlling the asset should be disclosed in the valuation report.

6.5 Where a Valuer is acting as an External Valuer but also has worked in a fee-earning
capacity for the client, such relationship must be disclosed lest a third party, having to
rely on the valuation, deem the Valuer‘s objectivity compromised.

6.6 Any limitations to the quality of the service that a Valuer is able to offer must be
disclosed whether this is due to externally imposed constraints or peculiar to the Valuer
or the assignment. Where outside assistance has been sought the Valuer must disclose
the identity of the assistants, the extent of reliance on, and the nature of, such
assistance.

6.7 A Valuer must place a restriction against the publication of a valuation or its
conclusions without consent so that the Valuer can keep a measure of control over the
form and context in which his or her valuations are publicly disclosed.

6.8 A Valuer should disclose any departures from the International Valuation Standards.

6.8.1 Standards are devised for the generality of situations and cannot cater to every
eventuality. There will be occasions where departure from Standards is inescapable.
When such situations arise, departure would be unlikely to constitute a breach of these
Standards, provided such departure is reasonable, complies with the principles of ethics
and measures of competence, and a rationale for such departure is provided in the
valuation report.

7.0 Reporting of Values

Valuation assignments may deal with one or more properties. The style of the valuation
report must be tailored to the nature of the assignment and the needs of the client while
meeting certain minimum requirements as to content. Philippine Valuation Standards
(1st Edition) – Adoption of the IVSC Valuation Standards under Philippine Setting Code
of Conduct 27
7.1 This paragraph sets out the minimum contents of any report or certificate. The
following items must be included. (Also see para. 5.1 of IVS 3, Valuation Reporting.)

the identity of the Valuer and the date of the report;

the identity of the client;

the instructions, date of the value estimate, purpose and intended use of the valuation;

the basis of the valuation, including type and definition of value;

the identity, tenure, and location (s) of the interest(s) to be valued;

the date and extent of inspections;

the scope and extent of the work used to develop the valuation;

any assumptions and limiting conditions, and any special, unusual, or extraordinary
assumptions;
 a compliance statement that the valuation has been performed in accordance with
these Standards and any required disclosures;

the professional qualification and signature of the Valuer; and

as required in some countries, specific certification by the Valuer in the prescribed

form.
7.2 The use of the valuation and the complexity of the property determine the level of
detail appropriate to the report. Where a single or complex property is being reported, it
may be appropriate for the report to go into greater detail on the data upon which the
valuation is based and the reasoning behind the conclusions. Where areport is being
prepared for a portfolio of properties for use in an audit function, the level of detailed
data required for each of the properties within the portfolio may be less extensive.

7.3 This section is not to be taken to represent the enquiries, research and analysis
needed to perform a proper valuation, merely the minimum that must be presented in
the report.
. Where a