#12 External Valuation
'EXTERNAL VALUATION: An independent assessment of value performed by an external third party.'
This term is defined in the GIPS 2020 Exposure Draft as “An independent assessment of value performed by an external third party”
Key Points about This Term
- This term is not new at all in the Global Investment Performance Standards (GIPS) vocabulary!
- It was, however, limited to the Real Estate provisions in the 2010 edition of the Standards.
- In line with the elimination of asset class orientation of the GIPS in the 2020 edition, it has been redefined to have a much broader meaning and application to Private Market Investments.
- Such ‘External Valuations‘ for ‘Private Market Investments‘ must be ‘ performed by an external, qualified valuer or appraiser’.
- Fun Fact – It appears nine (9) times in the Exposure Draft, excluding that in the definitions and executive summary sections and footnotes.
- Possible Evolution under new Standards – Already a key part f the Standards,not going anywhere.