Incorporating the International Valuation Standards

1 Incorporating the International Valuation Standards Advancing Standards in land, property and construction. rics is the world's leading qualification when it comes to professional rics professional Standards , Global and UK. Standards in land, property and construction. In a world where more and more people, governments, banks and commercial organisations demand greater certainty of professional Standards rics Valuation . and ethics, attaining rics status is the recognised mark of property professionalism. professional Standards January 2014. Over 100 000 property professionals working in the major established and rics HQ emerging economies of the world have already recognised the importance of securing rics status by becoming members.

2 Parliament Square, London SW1P 3AD. rics is an independent professional body originally established in the UK by United Kingdom Royal Charter. Since 1868, rics has been committed to setting and upholding Worldwide media enquiries: the highest Standards of excellence and integrity providing impartial, authoritative advice on key issues affecting businesses and society. e rics Valuation professional Standards rics is a regulator of both its individual members and firms enabling it to Contact Centre: maintain the highest Standards and providing the basis for unparalleled e client confidence in the sector. t +44 (0)24 7686 8555 rics has a worldwide network.

3 For further information simply contact the f +44 (0)20 7334 3811 relevant rics office or our Contact Centre. Europe Asia Americas (excluding United Room 2203 One Grand Central Place Kingdom and Ireland) Hopewell Centre 60 East 42nd Street January 2014. Rue Ducale 67 183 Queen's Road East Suite 2810. 1000 Brussels Wanchai New York 10165 2811. Belgium Hong Kong USA. t +32 2 733 10 19 t +852 2537 7117 t +1 212 847 7400. f +32 2 742 97 48 f +852 2537 2756 f +1 212 847 7401. Africa United Kingdom Ireland PO Box 3400 Parliament Square 38 Merrion Square Witkoppen 2068 London SW1P 3AD Dublin 2. South Africa United Kingdom Ireland t +27 11 467 2857 t +44 (0)24 7686 8555 t +353 1 644 5500.

4 F +27 86 514 0655 f +44 (0)20 7334 3811 f +353 1 661 1797. Oceania Middle East India Suite 2, Level 16 Office G14, Block 3 48 & 49 Centrum Plaza 1 Castlereagh Street Knowledge Village Sector Road Sydney, NSW 2000 Dubai Sector 53, Australia United Arab Emirates Gurgaon 122002. t +61 2 9216 2333 t +971 4 375 3074 India f +61 2 9232 5591 f +971 4 427 2498 t +91 124 459 5400. f +91 124 459 5402. JOBNAME: Red Book PAGE: 1 SESS: 1228 OUTPUT: Thu Oct 3 13:07:12 2013. rics Valuation professional Standards January 2014. Incorporating the IVSC International Valuation Standards Columns Design XML Ltd / Job: Red_Book_2014 / Division: RedBook5thproof /Pg. Position: 1 / Date: 2/10.

5 JOBNAME: Red Book PAGE: 2 SESS: 1228 OUTPUT: Thu Oct 3 13:07:12 2013. Published by the Royal Institution of Chartered Surveyors ( rics ). Parliament Square London SW1P 3AD. UK. No responsibility for loss or damage caused to any person acting or refraining from action as a result of the material included in this publication can be accepted by the authors or rics . Produced by the Valuation professional Group of the Royal Institution of Chartered Surveyors. ISBN 978 1 78321 025 1. Royal Institution of Chartered Surveyors ( rics ) November 2013. Copyright in all or part of this publication rests with rics . No part of this work may be reproduced or used in any form or by any means including graphic, electronic, or mechanical, including photocopying, recording, taping or web distribution, without the written permission of rics or in line with the rules of an existing licence.

6 Typeset in Great Britain by Columns Design XML Ltd, Reading, Berks Columns Design XML Ltd / Job: Red_Book_2014 / Division: RedBook5thproof /Pg. Position: 2 / Date: 2/10. JOBNAME: Red Book PAGE: 3 SESS: 1228 OUTPUT: Thu Oct 3 13:07:12 2013. Preface January 2014. This new edition of the rics Valuation professional Standards , the Red Book as it has become widely known, is the culmination of a comprehensive review of the content, framework and format of the 2012 and earlier editions. It also includes new material relating to business Valuation and intangible assets. This 2014 edition adopts and is fully compliant with the International Valuation Standards (IVS), which are reproduced as an annex in both hard copy and digital versions.

7 rics not only embraces these high level Valuation principles itself but also supports the adoption and implementation of such universal Standards globally. While the rics Red Book continues to cover in considerable detail the Valuation of assets in the form of real estate (land, buildings and interests therein), its coverage extends to all types of asset, including associated liabilities where appropriate. This edition incorporates a number of significant changes and updates, including its layout and format, to enhance its clarity and ease of use, and to ensure a robust framework for consistency and best practice in the execution and delivery of valuations.

8 Material that previously appeared in different parts of the 2012 edition has been brought together to improve clarity and avoid repetition. The Valuation Standards VS1 6 of the 2012 edition, including the associated Appendices, have been reviewed and incorporated into Global professional Standards (PS) and Global Valuation Practice Statements (VPS). All members providing a written Valuation are required to comply with these professional Standards and Valuation Practice Statements in other words, unless stated otherwise, they are mandatory. The guidance notes included within the 2012 edition have also been reviewed and updated and are now included as rics Global Valuation Practice Guidance.

9 Applications (VPGA). These Applications focus on the relevance and implementation of the professional Standards and Valuation practice statements in specific contexts, whether for a particular purpose or in relation to a particular property or asset type. While the applications are primarily advisory in nature, all members are expected to be familiar with them. Alongside this new edition of the Red Book, work is being taken forward to secure that real estate around the world is also measured consistently. Thus rics is a member of an International coalition, initially comprising 20 founder member organisations, to establish International Property Measurement Standards (IPMS), the first edition of which is due to publish in 2014.

10 Such measurement Standards will relate to and interconnect with all rics published material. rics Valuation professional Standards January 2014 iii Columns Design XML Ltd / Job: Red_Book_2014 / Division: RedBook5thproof /Pg. Position: 1 / Date: 2/10. JOBNAME: Red Book PAGE: 4 SESS: 1228 OUTPUT: Thu Oct 3 13:07:12 2013. Acknowledgments The rics appraisal and Valuation manual was originally published as two separate titles: Guidance notes on the Valuation of assets, 1st (1976), 2nd (1981) and 3rd (1990) editions, published under the title, Statement of asset Valuation practice and guidance notes and Manual of Valuation guidance notes, 1st (1980), 2nd (March 1981) and 3rd (April 1992) editions.