SAEE International Valuation Standards 5

Question 1

Under IVS, which standard deals with investigations and compliance during a valuation engagement?

Accepted Answer

IVS 102

Answer

IVS 102 covers investigations to be undertaken and compliance with the standards.

Question 2

Which IVS standard sets out the valuation approaches and methods?

Accepted Answer

IVS 105 Valuation Approaches and Methods

Answer

IVS 105 describes the three principal approaches and their associated methods.

Question 3

What does 'liquidation value' under IVS typically assume?

Accepted Answer

A forced or constrained sale, often within a limited time

Answer

Liquidation value assumes the seller is compelled to sell, often quickly.

Question 4

Under IVS, when a discounted cash flow (DCF) model is used, the discount rate should reflect:

Accepted Answer

The risk associated with the projected cash flows

Answer

The discount rate must capture the time value of money and the risk of the cash flows.

Question 5

Which of the following best describes the IVS principle of objectivity?

Accepted Answer

The valuer must not allow bias or conflicts to influence conclusions

Answer

Objectivity requires valuations free from bias, conflict of interest, or undue influence.

SAEE Test Practice Test