John Foord supports asset owners, risk managers, financial advisors, banks and accountants with cost allocations, decommissioning cost forecasts, asset register preparation or reconciliation, purchase price allocations and market valuations.
Financial valuations can be required for transactions, due diligence, taxation, financial reporting, or litigation support purposes.
John Foord can provide a range of reports depending on the purpose and content required.
Our team follow the highest standards set by professional bodies such as the International Valuation Standards Committee, Royal Institution of Chartered Surveyors, American Society of Appraisers, Australian Property Institute, Hong Kong Institute of Surveyors, TEGOVA, etc.
We also have a detailed understanding of the requisite International Accounting Standards, Statements of Recommended Practices, and often specific regulations applicable to the particular organisation whose commercial assets are being valued.
Our valuations include detailed commentary on our approach including advising on the level of supporting data used in arriving at the values, for example direct comparables or the sale of similar assets.
We understand the higher-level standards that auditors and others are now being held to, and the contents of our reports in terms of approach and methodology are designed to ensure that the valuations are transparent and any review work is minimised.
Some of the bases of value used in our financial reports include:
Market Value is defined in International Valuation Standards as:
“The estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction, after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion.”
Depending on the purpose of the valuation, market values may be prepared based on different underlying assumptions, e.g.:
- Market Value in Situ
- Market Value for Removal
- Market Value assuming Forced Sale or Liquidation
- Market Value assuming Disposal as Scrap
Each of these assumptions can have a bearing on the values reported and we engage with clients early in the appraisal process to understand their goals to ensure that we produce reports that not only meet these goals but that will stand up to the most detailed external scrutiny and analysis.
This is defined as:
“The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
(International Accounting Standards Board – IFRS 13)”.
The Fair Value of fixed assets is commonly, but not always, equivalent to Market Value.
In carrying out an assessment of Fair Value we consider if the current use of the assets is their highest and best use, any special value to the existing owner, if there are constraints to the sale of the assets as a whole as part of an undertaking and the treatment of marketing and sale costs.
Residual Value typically follows the definition under International Accounting Standard Number 16, namely:
“The Residual Value of an asset is the estimated amount that an entity would currently obtain from disposal of the asset, after deducting the estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life”.
Residual values are often required when clients need to make provisions for these costs in their financial statements.
We use up to date market data and analysis to ensure that residual values are realistic and reflective of current market conditions.