By Eva Lang - Earlier this month, Sarah Johnson, a senior writer at CFO magazine wrote in the article “How Far Can Fair Value Go?” that the problem with moving from historical cost to fair value financial statements lay in the difficulty of determining value due to “lack of consistent valuation standards, questionable valuation models, and uncertainty about the veracity of valuation specialists.” Ouch.
How can this perception persist when the valuation profession has better standards today than ever before, more sophisticated models, and higher ethical standards? Are a few bad apples spoiling the barrel for the hundreds of knowledgeable ethical valuation professionals? The lesson here is to recognize going into a fair value engagement that bias against valuers may exist. So we must be vigilant in doing our very best work, at the highest ethical level, with no hint of advocacy.