Code of Conduct

Introduction
Valuations performed in compliance with
Philippine Valuation Standards should:
• Be done by honest and competent professional
Valuers.
• Be free of bias or self-interest.
• Be clear and will not mislead.
• Disclose all matters essential to understand the
valuation.
• Promote and preserve public trust in the
valuation profession.
 Scope
• Valuers comply with these standards either by:
– Choice
– Requirements as mandated by law or
regulations
– Instructions of clients, users, and/or national
societies or organizations
• A valuation claiming to be prepared under
PVS binds the valuers to follow this Code
of Conduct.
 Definitions
• All valuations are dependent to some degree
– On adoption of assumption. Definition of
Market Value incorporates assumptions to
ensure consistency of approach.
– Or facts which could be determined.
• Limiting conditions are constraints imposed on
valuations, and maybe imposed.
– By clients
– By valuer
– By local laws
 Definitions
• A Valuer is a person who possesses the
necessary qualifications, ability and experience
to execute a valuation. He/she:

Has obtained an appropriate degree of learning or an
equivalent academic qualification.

Has suitable experience and competent in the valuing in
the market and category of the asset.

Is aware, understand and correctly employ methods and
techniques necessary to produce a CREDIBLE
VALUATION.

Is a member of recognized national professional body.

Pursues professional learning throughout his or her career.

Follows all the requirements of this Code of Conduct.
 Definitions
• An Internal Valuer is either employed by the entity that
owns the asset or the accounting firm that prepares
financial report;
• An External Valuer together with any associates has no
material links with the client or an agent acting on behalf of
the client or the subject of the assignment.
• Valuers who undertake assignments under PVS must meet
the requirements of

Impartiality

Professional objectivity, and

Disclosure
 Ethics
Integrity
• A Valuer must not
• Act in a manner that is misleading or
fraudulent.
• Knowingly develop and communicate a
report that contains false, inaccurate or
biased opinions and analysis.
• Contribute or participate in a valuation
service that other Valuers would not regard
to be ethical or justified.
 Ethics
A Valuer must:
• Act legally, comply with laws and regulations .
• Not claim or knowingly pass erroneous
professional qualifications, he/she does possess.
A Valuer must not:
• Knowingly use false, misleading or exaggerated
claims an advertising to secure assignments.
• Ensure that any Staff or subordinates assisting in
the valuation must also adhere with the Code of
Conduct.
 Ethics
Conflicts of interest
A valuer must not act for two or more parties in the
same matter, except with the written consent of those
concerned.
A valuer must

Take reasonable precautions to avoid conflict of
interest between his clients, his/her firm, relatives,
friends or associates.

Disclose potential conflicts in writing before
accepting instructions.
 Subsequent conflicts known/ascertained must be
disclosed immediately.
 Conflicts discovered after completion of the valuation
must be made within reasonable time.
 Ethics
• Confidentiality
A Valuer must

Deal with client’s affair with proper discretion and trust.

Not disclose sensitive factual data obtained from the
client of from investigation to anyone required by law.

Expect when authorized in situation where a valuer
must comply with certain quasi-judicial proceedings
within the recognized national professional valuation
body of which the values is a member .
 Ethics
Impartiality

Valuers perform an assignment with the strictest
independence, objectively and impartiality

Does not accept an assignment that includes the
reporting of predetermined opinions and
conclusions

Fees must not depend on the predetermined
outcome of any valuation or other independent,
objective advice contained in the report

Fees whether contingent or not upon any aspect
of the report must be disclosed.
 Ethics

Not rely upon critical information supplied by
a client of other party without qualification or
confirmation from reliable source unless the
nature and extent of such reliance is
specified as a limiting condition.

Not accept an assignment to report assumed
hypothetical conditions, unlikely to be
realized within reasonable timescale.
 Ethics
• Not use or rely on unsupported conclusions based
on

Prejudice of any kind or

Report conclusions reflecting an opinion that
such prejudice is necessary to maintain or
maximize value.
• In reviewing another Valuer's report, a Valuer shall
exhibit impartial judgment and justify his or her
reasons for agreeing or disagreeing with the
conclusions of the report
 Competence
• A valuer must

Have the knowledge, skills and experience to complete
the assignment efficiently in relation to an acceptable
professional standard.
• Acceptance of instructions
• Prior to acceptance of assignment or agreement to
perform

A valuer must
• identify the problem to be addressed
• he or she has the experience and knowledge
• associate with a professional possessing the
experience and knowledge of the market forces,
language and law to complete valuation related to
an overseas assignment.
 Competence
• Outside assistance

A valuer engaging outside assistance should first establish that
those assisting have the requisite and ethical principles.

Client’s consent should be obtained for outside assistance.
Identify and role disclosed in the report.
• Efficiency and Diligence
• Valuers should act promptly and efficiently in carrying out client
of the work progress.
• Valuer should decline instructions which preclude sufficient
diligent enquiry of work and completion within reasonable time.
• Written instructions from the client should be confirmed by the
valuer to avoid misinterpretation.
• Valuer should keep work file for each assignment upon
completion in paper or electronic form (suitably backed-up) of all
supporting papers.
• Such file should be retained at least five years after completion
of the assignment.
 Disclosure
• The communications, analysis, opinions and
conclusions to the users of the Valuers services
must be meaningful not misleading and discloses
anything that might be taken to affect objectivity.
• The valuation report should set out a clean and
accurate description of the scope of the
assignment.

Its purpose and intended use

Disclosing any assumptions

Hypothetical scenarios or limiting conditions

That directly affect the valuations and where
appropriate indicating their effect on the value.
 Disclosure
• Sufficient information, describes work performed,
conclusions reached and the context in which they
were shaped.
• Disclose direct or indirect personal or corporate
relationship that might lead to potential conflict of
interest.
• As regard internal Valuer, disclose relationship with the
entity controlling the asset.
• A Valuer acting as an External Valuer but also has
worked in a free-earning capacity for a client such
relationship must be disclosed least a third party,
having to rely on the valuation door the Valuers
objectivity compromised.
 Disclosure
• Any limitation to the quality of the service must be disclosed
whether due to externally imposed constraints or peculiar to the
Valuer or the assignment. Outside assistance when sought must
disclose the identity of the assistant extent and reliance on and
nature of such assistance.
• A Valuer must place restriction against the publication of his
report or its conclusion without consent. This is to keep a
measure of control over the form and context in which the
valuations are publicly disclosed.
• Departures from the PVS should be disclosed.
• Standards (PVS) are for the generality of situations and cannot
cater to any eventuality.

When departure arise, such departure would unlikely
constitute a BREACH of these standards-if it is reasonable
complies with principles of ethics and measure of competence
and a rationale for such departure is stated in the valuation
report.