I was recently asked to review the valuation of a commercial real estate property here in Cyprus. The property belonged to a friend of a friend and the valuation was performed by a non-Cypriot, who had recently moved in on the island.
Naturally, the first thing I did in this case (and as a matter of fact, in any case in which I need to review the work of someone else), is to ask about (and if possible, meet) the person who did the original work. The more I get to trust this person’s skills and experiences, the higher level will my review be, the less time needed for the review, and the lower the cost to the client.
In this case, I was asked to leave the cash flow-related inputs of the exercise outside of my scope and take for granted that they represented a fair value level of cash flows that would maximize the value of the asset. Therefore my scope was effectively narrowed down to two things: Adequacy of the valuation methodology followed and correct application of it.
Nevertheless, the risks remained: The valuation was performed by someone who I had never heard of, and despite his claims of previous expertise in valuation, I had no way of verifying the quality of his work. Furthermore, he was not “qualified” as per the local standards. I therefore decided to check everything that fell within my scope, effectively reperforming the entire valuation, save for the cash flow assumptions.
After finishing with my review, I let my friend know with confidence that the valuation was indeed adequate for the purpose. And I can say with certainty that the confidence that I felt after reviewing this person’s work, was much higher than what I was feeling after reviewing the work of many locally qualified appraisers.
I do not have any issues against professional qualifications. I have two of them actually. But I don’t “advertise” them. All I’m trying to say I guess is this: Qualifications and fancy offices, may convey a certain image about a professional. But it’s not all that matters. Whenever you have the chance, try handing out some work to people who may not have a massive marketing machine behind them to “prove” their worth. Most of the time you will be amazed by the results. Because to these professionals you may not be just another client. You may be “the” client.