Mistakes are made on two counts: an argument is either based on error or incorrectly developed
THE LIST OF PERFORMANCE APPRAISAL DELUSION GOES AS FOLLOWS
Waiting For The Performance Appraisal To Give Feedback
Misunderstanding the clients' needs
Relying on the clients' interpretation of USPAP
Failure to create the proper "scope of work"
Not notifying the client of limited expertise or lack of it for an assignment
Incomplete research of the subject property
Reliance on only one data collection source for comparables
Inability to properly explain adjustments and/or final reconciliation
Failure to identify zoning/ highest and best use issues
Incomplete work files/ unsigned certifications
Lack of Geographical Competency
Overemphasizing Recent Performances
Being Too Positive Or Negative
Being Critical Without Being Constructive
Talking Not Listening
State the date of the valuation and the date prepared
Define the purpose of the valuation
Define the standard of value (e.g. Fair Market)
Conduct a site visit
Include assumptions and limiting conditions
Discuss:
Company background
Industry in which the company participates
Market in which the company competes
Competition
Economic environment in which the company competes
Prepare a comparative financial analysis with industry performance
Examine and discuss all common valuation methods
Adequately define "earnings"
Disclose assumptions and source of cash flow projections
Define formulas - CAPM, WACC, Fama-French, Gordon Growth Model
Apply the proper discount/capitalization rate to "earnings" as defined
Adequately discuss and analyze guideline companies selected
Discuss empirical data sources for premiums and discounts applied
Reconcile values indicated by each valuation method examined
Select one value
Disclose sources of information contained in the report
THE LIST OF PERFORMANCE APPRAISAL DELUSION GOES AS FOLLOWS
Waiting For The Performance Appraisal To Give Feedback
Misunderstanding the clients' needs
Relying on the clients' interpretation of USPAP
Failure to create the proper "scope of work"
Not notifying the client of limited expertise or lack of it for an assignment
Incomplete research of the subject property
Reliance on only one data collection source for comparables
Inability to properly explain adjustments and/or final reconciliation
Failure to identify zoning/ highest and best use issues
Incomplete work files/ unsigned certifications
Lack of Geographical Competency
Overemphasizing Recent Performances
Being Too Positive Or Negative
Being Critical Without Being Constructive
Talking Not Listening
State the date of the valuation and the date prepared
Define the purpose of the valuation
Define the standard of value (e.g. Fair Market)
Conduct a site visit
Include assumptions and limiting conditions
Discuss:
Company background
Industry in which the company participates
Market in which the company competes
Competition
Economic environment in which the company competes
Prepare a comparative financial analysis with industry performance
Examine and discuss all common valuation methods
Adequately define "earnings"
Disclose assumptions and source of cash flow projections
Define formulas - CAPM, WACC, Fama-French, Gordon Growth Model
Apply the proper discount/capitalization rate to "earnings" as defined
Adequately discuss and analyze guideline companies selected
Discuss empirical data sources for premiums and discounts applied
Reconcile values indicated by each valuation method examined
Select one value
Disclose sources of information contained in the report