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Ugochukwu Nwora, the Head of the Directorate of Valuation Standards at the Financial Reporting Council of Nigeria (FRC), has announced the council’s initiative to develop comprehensive valuation regulations for the country. Speaking at the Nigerian Institution of Estate Surveyors and Valuers’ Valuation Day event themed “Importance of Assets Valuation in Financial Stability” in Lagos, Nwora outlined the FRC’s plans for the release of these regulations.
According to Nwora, the Executive Secretary, Dr Rabiu Olowo, has directed the assembly of relevant professionals to produce these regulations, with a target release date of July 31, 2024. These regulations, unprecedented in Nigeria, will be subject to public exposure before their official launch in July. Nwora emphasized that the valuation regulations will serve as a guiding framework for all professional valuers and firms in Nigeria, urging them to register with the FRC, particularly those who are yet to do so.
Highlighting the objectives of the FRC’s initiative, Nwora underscored the importance of standardization and regulation in ensuring consistency and adherence to asset valuation standards. He expressed concern over the lack of standardization in valuation reports and emphasized the need for regulatory oversight to uphold valuation standards. The FRC aims to register every valuation professional and firm, enabling swift action in cases of breaches while safeguarding the integrity of the profession.
Nwora assured stakeholders that the FRC valuation regulations would be available before the end of July, with plans for their official inauguration in the following week. He reiterated the council’s commitment to engaging various stakeholders in the process, inviting critical review and feedback on the draft regulations.
In response to the announcement, Gbenga Ismail, Chairman of the Nigerian Institution of Estate Surveyors and Valuers, Lagos Chapter, emphasized the importance of valuation in asset management and utilization. Ismail advocated for government recognition of valuation processes, advocating for its integration into regular practices on a yearly basis.
Expounding on the significance of valuation, Ismail highlighted its role in aiding decision-making for investors, businesses, and analysts. He stressed the necessity of accurate valuation reports in certifying assumptions and ensuring informed financial strategies.
Meanwhile, Abidemi Ojo, the Honorary Publicity Secretary of NSEIV, Lagos Branch, addressed the issue of disparity in valuation reports over time. Ojo identified various factors contributing to such discrepancies, including non-disclosure of property title documents, client influence, and inaccurate market data. He emphasized the importance of adherence to regulations and standards to mitigate valuation disparities.
The forthcoming introduction of valuation regulations by the FRC signifies a significant step towards standardizing and regulating the valuation profession in Nigeria, aimed at enhancing transparency, consistency, and integrity in asset valuation practices.
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