Certified Valuation Analyst CVA Professional Standards and Ethics 5

Question 1

Under NACVA standards, what must a valuation report include regarding the analyst's assumptions?

Accepted Answer

A statement of the assumptions and limiting conditions relied upon

Answer

Reports must disclose the assumptions and limiting conditions underlying the conclusion.

Question 2

A discount for lack of marketability (DLOM) is most appropriately applied to:

Accepted Answer

Interests in closely held companies with no ready market

Answer

DLOM compensates for the absence of a ready market, typical of closely held interests.

Question 3

What does the CVA standard of 'due professional care' require during an engagement?

Accepted Answer

Diligence, competence, and thoroughness consistent with professional standards

Answer

Due professional care demands diligence, competence, and thoroughness aligned with professional standards.

Question 4

When a CVA signs a valuation report, the signature primarily represents:

Accepted Answer

The analyst's professional responsibility for the conclusions

Answer

The signature signifies the analyst's professional responsibility for the report's conclusions.

Question 5

Which standard of value reflects the value to a particular investor based on individual requirements and synergies?

Accepted Answer

Investment value

Answer

Investment value reflects worth to a specific investor considering their unique synergies and requirements.

Certified Valuation Analyst Practice Test