Asset Valuations/Valuation for Company Account Purposes
Unlike other company assets, which are often written down over a given number of years in the balance sheet, land and buildings are required to be valued to current market value.
There are a number of specialist properties which are not readily disposed of in the market where it is necessary to value the buildings by reference to the cost of constructing a replacement building (DCR basis). Examples include schools and other public buildings.
Valuations may have to be updated regularly including property holdings in a company's balance sheet. Even where companies employ their own in-house property manager, it is recommended that at least a proportion of the company's property holding is valued externally by an independent Valuer to obtain an impartial valuation of the property.
Where there is a change in Directors or Shareholding, the company may require an updated valuation of the company's assets to include a market value of the property holdings. Similarly where a director or shareholder retires, the assets may need to be divided between the remaining directors or shareholders.