What is the IVSC and what role does it play in intangible asset valuation?

Full Explanation

The International Valuation Standards Council is an independent, not-for-profit organisation that develops and maintains the International Valuation Standards (IVS) — the most widely adopted valuation standards globally. For intangible asset valuation, the IVSC provides critical guidance through several standards. IVS 210 (Intangible Assets) specifically addresses the identification, valuation approaches, and key considerations for intangible asset valuation, including the distinction between identifiable intangible assets and goodwill. IVS 200 (Businesses and Business Interests) covers the valuation of business enterprises, which is relevant for goodwill impairment testing and transaction advisory. IVS 105 (Valuation Approaches and Methods) outlines the three fundamental approaches (income, market, cost) and their application to different asset types. The IVSC standards complement the accounting standards (IFRS, US GAAP) by providing practical guidance on how to perform valuations, while the accounting standards define what must be valued and how results are reported in financial statements. Professional valuation bodies that require compliance with IVSC standards include: the Royal Institution of Chartered Surveyors (RICS) through its Red Book, the American Society of Appraisers (ASA), and many national valuation organisations. For companies engaging valuation professionals, selecting a practitioner who follows IVSC standards ensures a globally consistent, transparent, and defensible approach to intangible asset measurement. The IVSC also publishes technical guidance papers on emerging topics like the valuation of data assets, ESG-related intangibles, and digital assets.

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