Many people wonder what business valuation certification a valuation professional should have in order to be recognized by the appropriate authorities, regulators and consumers of business valuations. Typically, a business valuation professional would hold an advanced degree in accounting, finance and/or business. In addition, knowledge of statistical models would also help a valuation professional. To select a qualified business valuation professional, a client would need to look for the following widely recognized and accepted credentials:
- Accredited Senior Appraiser (ASA);
- Accredited in Business Valuation (ABV);
- Certified Business Appraiser (CBA);
- Certified Valuation Analyst (CVA);
- Chartered Financial Analyst (CFA); and Chartered Business Valuator (CBV)
Below we will discuss each business valuation certification.
Accredited Senior Appraiser (ASA)
The designation is granted by the American Society of Appraisers (ASA). The American Society of Appraisers is a multi-disciplinary organization which includes members with backgrounds in real estate, business valuation, fine arts, machinery and equipment and gemology. The first step to acquire the Accredited Senior Appraiser designation requires candidates to pass either an ethics exam or a course and examination on the Uniform Standards of Professional Appraisal Practice. After that the applicant must pass a series of principles of valuation courses. Upon successful completion of the courses, the applicant must have a minimum of five years or equivalent of full-time appraisal experience. The final step for the applicant is to submit a representative valuation report for review.
Accredited in Business Valuation (ABV)
It is a designation, granted by the American Institute of Certified Public Accountants (AICPA) which is the national professional association for Certified Public Accountants in the United States that also grants the Certified Public Accountant (CPA) designation. To acquire an ABV designation, an applicant is required to hold a valid CPA and pass a comprehensive business valuation examination. In addition, AICPA requires an applicant to have had a substantial involvement in at least six business valuation engagements or to provide evidence of 150 hours of business valuation experience.
Certified Business Appraiser (CBA)
Certified Business Appraiser (CBA) is granted by the Institute of Business Appraisers (IBA). This designation requires members to have a 4-year bachelor’s degree or equivalent, to complete 24 hours of coursework offered by the IBA, and to pass a 6-hour, proctored, written examination covering both theoretical and practical concepts of business appraisal. The final step for CBA designation applicants would be to submit two examples of their work to the IBA.
Certified Valuation Analyst (CVA)
Certified Valuation Analyst (CVA) is a certification issued by the National Association of Certified Valuation Analysts (NACVA). CVA application candidates are required to complete a 5-day business valuation course, an exam covering business valuation principles proctored. Finally, CVA applicants are required to submit case study and show proof of two years of experience as a CPA.
Chartered Financial Analyst (CFA)
Chartered Financial Analyst (CFA) charter is granted by the CFA Institute, a global association of investment professionals. To become a CFA charter holder an applicant must pass through the CFA Program, a graduate-level, self-study program that provides a broad curriculum which includes ethical and professional standards, statistics, economics, finance, securities valuation, accounting and derivatives among others. T
o pass the CFA Program a candidate must pass a series of three 6-hour, sequential exams. In addition, the applicant must have 4 years of professional work experience in investment decision making. Unlike the designations mentioned above, the CFA curriculum is not specifically geared towards valuation. Rather, CFA charter holders are typically employed as securities analysts, portfolio managers, investment bankers and consultants.
Chartered Business Valuator (CBV)
Chartered Business Valuator (CBV) is a designation granted by The Canadian Institute of Chartered Business Valuators (CICBV). In order to receive the CBV designation, an applicant must complete the six courses offered by the CICBV, accumulate at least 1,500 hours of business and securities valuation work experience, and successfully pass the membership entrance exam.
Contact us if you need advice on retaining a suitable business valuation services firm.
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