Estate surveyors and valuers under the aegis of Nigerian Institution of Estate Surveyors and Valuers (NIESV) are considering new valuation standards that will not only improve their service delivery, but also attest to the integrity of their reports and give credence to their professionalism.
Valuation of properties or real estate assets is at the core of the professional services offered by estate surveyors and valuers. It is clearly the most high profile of their range of professional services and earns them treasured membership of the comity of respected professionals.
At the moment, property valuation is based on a template given by the Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON), also called ‘The Board’, that was established by Decree No. 24 of 1975 (now Cap E13 LFN 2007) as a body corporate with perpetual succession and a common seal as the Regulatory Body for the profession of estate surveying and valuation in Nigeria.
The template is a laudable initiative and a useful framework for a compliant valuation report. Clearly all key heads of standard valuation report are covered, including descriptive, factual and judgment components. “However, the document is sadly short on the key aspects of practical procedures and best practices, guidance, applications and helpful templates”, noted Victor Alonge, who spoke at the Mandatory Continuous Professional Development Programme (MCPD) of NIESV, Lagos State Branch.
Alonge, a senior partner/CEO, Victor Alonge & Associates, spoke on ‘Standardization of Valuation Report in Nigeria: Valuation Reporting Standards in Accordance with ESVARBON Regulations’, contending that valuation standards document must provide practical guidance on uniform valuation procedures and practices for valuers.
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“That is why the present joint initiative of NIESV and ESVARBON in carrying out a comprehensive review of our valuation standards and practice in Nigeria with a view to producing a robust document that not only embraces high level valuation principles but also clearly supports the adoption and implementation of universal standards should be commended. The proposed ‘Green Book’ will recognize the twin-status of valuation as a science and an art”, he assured.
Continuing, alonge said, “I am particularly encouraged to note that the ‘Green Book’ would address the shortcomings and general inadequacy of the current Valuation Reporting Template. It would incorporate Professional Standards (PS) and Valuation Practice Statements (VPS), that all members providing a written valuation would be required to comply with, in order words, unless stated otherwise, they will be mandatory”.
He lamented that a large number of registered estate surveyors and valuers do not comply with The Board’s Valuation Reporting Template due largely to ignorance of the document and its mandatory regulatory force. That ignorance and non-compliance coupled with a regime of weak enforcement by the Board have resulted in embarrassing discrepancies and variations between valuations, which do little to help the profession improve its sometimes “questionable” public image.
“Let us be honest with ourselves, the valuation skills of a good number of our members have been tried and often found wanting. Client’s confidence in the valuation reports produced by our members has been on downward journey for some time. Valuations continue to come under fire not only for their accuracy and the bases on which they were calculated but also the reporting format and standards”, he noted, adding, “the profession’s present valuation reputation among the banks is a result of the exposure of the weaknesses in the regulation of the process and practice of valuation”.
He pointed out that the ‘Green Book’ would also include Valuation Practice Guidance – Applications (VPGA) which would focus on the relevance and implementation of the professional standards and valuation practice statements in specific contexts, whether for a particular purpose or in relation to a particular property or asset type. “These Applications would be primarily advisory in nature, and all our valuers would be expected to be familiar with them”, he said.
CHUKA UROKO
