One of the most important messages from the International Valuation Standards Council’s (IVSC) recent Managing and Communicating Value Uncertainty paper is that uncertainty is not a flaw in valuation. It is an inherent part of professional valuation practice. Different competent valuers may reach different, yet reasonable, conclusions when assessing the same asset because valuation involves professional judgement, assumptions, market evidence, and analysis.

The paper draws an important distinction between valuation risk and value uncertainty. Valuation risk arises when errors, inappropriate assumptions, poor data, or inadequate processes affect a valuation. Value uncertainty exists even when a valuation has been completed correctly and in accordance with professional standards. It reflects the reality that there may be more than one reasonable view of value.

This distinction matters because many assets do not trade in deep, transparent markets. Fine art, antiques, collectables, jewellery, vehicles, machinery, businesses, and other specialist assets often involve limited comparable evidence, changing market conditions, or unique characteristics. In these circumstances, uncertainty is unavoidable and must be professionally managed.

For those holding the AVAA Certified Valuer (CVAu) credential, the paper reinforces the value of professional expertise. The role of the valuer is not simply to identify a number. It is to analyse available evidence, exercise independent judgement, apply appropriate methodologies, and clearly explain the reasoning that supports the valuation conclusion.  A copy of the paper can be downloaded via the link below:

The IVSC emphasises that professional judgement, professional scepticism, reliable evidence, and transparent disclosure are central to producing credible valuation outcomes. These are also fundamental expectations of AVAA Certified Valuers (CVAu). Clients, courts, insurers, financiers, government agencies, and other stakeholders engage professional valuers because they require an informed and independent opinion that can withstand scrutiny.

Importantly, the paper highlights that robust valuation is not about eliminating uncertainty but about understanding, managing, and communicating it clearly. A well-prepared valuation report should explain the assumptions adopted, the evidence relied upon, and the factors that may influence value. Transparency strengthens confidence in the valuation process and assists users in making informed decisions.

For those with the respected AVAA Certified Valuer (CVAu) credential, these principles further demonstrate why professional credentials matter. The CVAu credential identifies valuers who operate within a recognised framework of professional standards, ethics, continuing professional development, and accountability.

The Auctioneers and Valuers Association of Australia (AVAA) partnership with the IVSC further strengthens the professionalism of the sector, and the IVSC’s work on value uncertainty reflects the same principles-based approach that underpins the AVAA Professional Standards. Together, they provide a framework that helps ensure AVAA Certified Valuers (CVAu) deliver professional, credible, and trusted valuation services in increasingly complex and uncertain markets.

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Interested In Finding Out More?

If you’re interested in this matter, send an email to standards@avaa.com.au or telephone 1300 928 165.  You can also stay up to date by following AVAA on LinkedIn, X/Twitter and Facebook.
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