A Registered Valuer is a valuation expert who can assess the worth of stocks, bonds, intangible assets, and tangible assets. Chartered Accountants (for example, in the case of stock valuations), engineers and surveyors (for property or physical assets appraisals), or specialised valuation experts can all be registered, valuers. To practise as a Registered Valuer, you must have completed a particular amount of training, have more than 3 or 5 years of valuation experience, and have a valid, ongoing certificate of practise (COP).
A registered valuer is a person or an organisation that is registered with the bankruptcy board of India and insolvency as a valuer in agreement with companies. The conception of a registered valuer was first introduced in the companies active in the year 2017 in order to manage and balance the valuation of liabilities and assets linked to a company.
The registered valuer concept was introduced by Indian law for the first time under Section 247 of Chapter VXII of the Indian Companies Act for matters which required valuation for the company's assets under the act. The Ministry of Corporate Affairs introduced the Companies (Registered Valuers and Valuation) Rules, 2017 ("Rules"). The registered valuer concept or idea opened a new area of professional opportunity for people.
The valuation report consists of-
- Includes purpose of a valuation
- Sources of information
- Procedures executed to carry out the valuation
- And all the factors influencing valuation
- According to the company's rules 2017, the registered valuers should state 11 key aspects in their report.
- He should also state any disclosure of the valuer's conflict of interest
In order to become a registered valuer-
You need to clear the valuation examination conducted by IBBI. Five years of post-qualification experience plus graduation. Three years of post-qualification experience plus post-graduation with three years of post-qualification experience and part of any professional institute. You need to have at least three years of experience in relation to the valuation of the class of asset for which the registration seeks.
- Not a minor
- Resident of India
- With a sound mind
- Not been sentenced for more than 6 months
What types of assets may a registered valuer appraise?
Land and building valuations, plant and machinery valuations, and securities and financial asset valuations can all be done by registered valuers. They can register to value all three classes of assets, but they can only value the assets for which they hold a registration.
Under the provisions of the Companies Act, a Registered Valuer's report on the valuation of equity shares is mandatory in the following situations:
- Unless there is a rights issue, new shares are issued to owners under Section 62.
- Merger, amalgamation, or restructuring under Section 230-232 necessitates the valuation of assets or shares or the calculation of a swap ratio for a share swap on the merger of two companies.
- Existing shareholders who own more than 90% of the company's stock can buy a minority interest under Section 236.
- The issuance of sweat equity and the allocation of shares for payment other than cash
- Section 68 allows for the buyback of some or all of a company's shares.
- Insolvency and Bankruptcy Code, 2016 liquidation of a firm
What is valuation?
Value in the form of money that one will receive in turn of that asset.
- E.g.:- when we say the value of this or that house is so and so.
- That's the value of the house one can get from selling it in the future; that's his or her asset.
- A reasonable return on the asset
- A fair value of the asset
- One gets in exchange, with equally relative usage
- The equal relative value of that asset
- Always keep liability in mind while evaluating it
Types of registered valuer:-
- Plant and machinery valuer
- Securities and financial assets valuer
- Building and land valuer
- This concept was introduced in India by the companies act of 2013. It existed earlier as well but with no proper regulation.
- The first valuation was through the valuation professional Bill, 2008, which was delayed for many years.
- This resulted in introducing second order, the company second order,2017 on 23rd October 2017
- To work as a valuer, one has to register himself or herself with authority.
- Registered under IBBI can valuate as per the act, i.e. the companies act, 2013, which came into effect on 17th February 2019
Duties of a registered valuer
He or she can only do valuation under the Act of The Companies (Registered Valuers And Valuation) Rules, 2017.
The rule is the same in any case; for example- law is required for the valuation
A valuator can perform his task under the following acts:
- Bankruptcy Code & Insolvency, 2016
- Companies Act, 2013
- SEBI Regulations, 2014
Laws related to the registered valuer
The registered valuer needs to follow some rules and regulations related to the registered valuer. Registered valuer includes:-
- Stock Exchange Board Of India
- Ministry Of Corporate Affairs
- Insolvency And Bankruptcy Board Of India
The following measures taken by these companies are:-
Under Section 247 Of The Companies Act,2013, which defines it based on the following
- The total worth of the asset
The person must fulfil the requirements, including experience and eligibility, with the related authority.
An audit committee will appoint the registered valuer
In the absence of an audit committee, the board of directors of the company can designate the registered valuer
So registered valuer means the name of the person whose name is registered under an authority issued by the board with section 16. In simple language, one who is registered with the valuation registered board.
It is crucial to consult a CA before entering into any transactions, as companies, without even evaluating the requirement of the company, fall for merges, share issues, etc.
What will be best for the company is to get in touch with a CA who is experienced in this field and a registered valuer as well. He/she will be able to fulfil all the requirements related to the company as well.
Contact Us for Registered Valuer Consultants, Registered Valuer Services in Delhi, Noida, Gurgaon, and all across India: write to us at firstname.lastname@example.org. Or Call On :(+91)-9711021268 +91-9310165114