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Govt plans council to certify valuation professionals

Rayana Pandey  |  New Delhi 

The Ministry of Corporate Affairs is working on a Bill for setting up a Council of Valuation Professionals of India to certify individuals who value business units.
The Valuation Bill is likely to come up during the winter session of Parliament.
The Institute of Chartered Accountants of India (ICAI), the Institute of Cost and Works Accountants of India (ICWAI) and the Institute of Company Secretaries of India (ICSI) will be the council's deemed members.
The five other member institutes will be selected on the basis of the training standards set by the council, which will also have five government nominees as members.
Individuals who want to become valuation professionals have to be from one of the council's member institutes. Professionals already in the business will have to get a certificate by qualifying some tests to be conducted by the council.
The certified valuers will have to pay an annual fee by April 1 every year. Ministry sources said the fee was expected to be decided by the end of the year.
"Today, anyone can carry out valuation, be it a merchant banker, a chartered accountant, a cost accountant or an engineer. This leads to discrepancies," said Chandra Wadhwa, the newly elected president of the ICWAI and chairperson of the working committee that formulated the concept paper for this move.
"Arriving at correct valuation of a business unit is all the more important in this time of mergers, acquisitions and takeovers. A single method will ensure uniformity all over the country," added Wadhwa.
World over, the US, the UK, Canada and the European Union have a regulatory mechanism for business valuation.
These regulatory bodies set training standards and frame ethical code of conduct for the profession.

First Published: Tue, August 28 2007. 00:00 IST