What a Business Appraiser’s Accreditations Mean and What They Can Tell You About the Appraiser
1. Is the Business Appraiser a Full-Time Professional?
The following certifications indicate that the accredited business appraiser is a full-time experienced professional dedicated to the highest professional standards:
The CBA – Certified Business Appraiser – has the most demanding peer review and offers the most thorough, rigorous course work and training to be a business appraiser. Awarded by the Institute of Business Appraisers, its peer review process is the most demanding in the industry with more than 75% of initial reports being returned for correction before being accepted.
“the CBA is extremely difficult to obtain – this is well known in the industry. As a specific example, in 2014 we had 47 candidates submit reports, of which two were passed. … CBAs (MCBAs) represent a premier group of BV professionals who had to cross the “Grand Canyon” to achieve their designation. This is not something to be wasted, and like a rare coin, is something to be cherished.”Parnell Black, CEO of the NACVA
The ASA – Accredited Senior Appraiser – the profession’s preeminent standard.
It is awarded by the American Society of Appraisers only to those who have:
- completed over 10,000 hours of appraisal work
- only designation required to comply with USPAP.
- successfully passed more than 6 hours of written examinations
- have a college education
- and have had samples of their work product reviewed and accepted by a peer review committee.
2. Do They Have Relevant Knowledge and Experience?
The below certifications related to business valuation services indicate a greater breadth of relevant knowledge and experience in understanding buyers and sellers.
A business appraiser who has the CBA and ASA designations plus the CBI brings the highest level of understanding to any appraisal situation.
A business appraiser (CBA/ASA) who also holds a CBI (Certified Business Intermediary) designation is closely involved with actual transactions and has inside knowledge and experience regarding how buyers and sellers actually respond in different situations.
The CBI – Certified Business Intermediary – Designation
The International Business Brokers Association awards an accreditation as a Certified Business Intermediary (CBI) to individuals:
- with 2 or more years of brokerage experience
- that have completed a series of 64 hours of specified training classes
- and have passed a 3 hour comprehensive written exam of which approximately 50% is based on issues about how to price businesses for sale.
“Been There, Doing That” Experience Rules
Individuals who are regularly engaged in the transfer of business ownership in the open market are thought to be some of the most knowledgeable people when it comes to what business interests sell for and defining the terms and conditions that buyers and sellers agree to in order to accomplish a sale.
3. Additional Less Rigorous Accreditations
There are other accreditation in business appraisal which you may find listed as part of a business appraiser’s credentials. They do not have the same weight as the above top accreditations. They are offered to professionals who have taken a prescribed set of courses and passed a written examination.
- The Accredited in Business Valuation (ABV) credential is awarded by the AICPA.
- The National Association of Certified Valuation analyst awards a credential of Certified Valuation Analyst (CVA) to professionals who have taken a 40 hour class including an examination and completed a take home case study.
- Note: Neither of these credentials require peer review of work product.