Business Valuation Standards Explained: IVS, RICS Red Book and IFRS 13

By Bill Anderson, FCCA, Chief Executive Officer, Assetica — 2026-06-30

Direct Answer: Three frameworks govern professional business valuation. The International Valuation Standards (IVS) are the global baseline for how valuations must be scoped, performed and reported. The RICS Red Book incorporates IVS and adds professional conduct and inspection requirements. IFRS 13 is an accounting standard that defines fair value for financial reporting. A credible valuation states which standard it is prepared under, because that is what tells the reader what the number means and how it can be relied on.

Every serious valuation report claims to follow standards, but few clients are told what those standards actually require. Knowing the difference matters, because a bank, a court, an auditor and a tax authority each expect a different framework, and a report prepared under the wrong one can be rejected however good the analysis is.

Business Valuation Standards Explained: IVS, RICS Red Book and IFRS 13

The three frameworks at a glance

Framework	What it is	Who typically requires it
IVS	The global baseline: how a valuation must be scoped, performed and reported	Courts, regulators, cross-border commercial purposes
RICS Red Book	Adopts IVS in full, adds valuer conduct, competence and quality-control requirements	Banks and institutional lenders
IFRS 13	An accounting standard defining fair value and the fair value hierarchy for financial statements	Auditors, for PPA, impairment testing and financial reporting

IVS: the global baseline

The International Valuation Standards, published by the IVSC, define how a professional valuation must be scoped, what bases of value can be used, which approaches (income, market, cost) apply, and what a compliant report must disclose. IVS is the framework regulators worldwide reference, from Saudi Arabia's Taqeem to European authorities. When Assetica prepares a valuation to IVS, it means the purpose, the basis of value, the methods and the assumptions are documented to a standard any professional reviewer can follow.

The RICS Red Book: IVS plus professional accountability

The RICS Valuation - Global Standards, known as the Red Book, adopt IVS in full and add requirements on valuer objectivity, competence, terms of engagement and quality control. Banks and institutional lenders frequently specify Red Book compliance because it attaches professional accountability to the number. A valuation prepared to RICS standards therefore carries both the IVS methodology and the conduct framework around it.

IFRS 13: fair value for financial reporting

IFRS 13 is not a valuation methodology but an accounting standard: it defines fair value for financial statements and establishes the fair value hierarchy (Level 1 quoted prices, Level 2 observable inputs, Level 3 unobservable inputs). It governs purchase price allocations, impairment testing and investment portfolio reporting. Auditors test valuations against IFRS 13, which is why financial-reporting valuations must be built with the hierarchy and disclosure requirements in mind from the start.

Which standard does your valuation need?

It follows from the purpose. A bank facility or institutional transaction: RICS Red Book. A court, regulator or cross-border commercial purpose: IVS. Financial statements, PPA or impairment: IFRS 13 alongside IVS methodology. UAE authorities such as the FTA and GDRFA accept valuations prepared to these recognised frameworks. The practical takeaway: tell your valuer the purpose first, and the correct standard, basis of value and report format follow from it.

For wider context, see our guide to the three core valuation methods.

What to expect in the final report

Whichever standard applies, a compliant report is built the same way underneath: a clear statement of the instructing party, the purpose and the basis of value; the valuation date; the methodology used and why, with at least two approaches triangulated where the standard requires it; the key assumptions and information relied on, disclosed rather than buried; normalised earnings with adjustments explained; and a signed conclusion of value the reader can trace back through the analysis. A report that skips any of these is not fully compliant with IVS, whatever it claims on the cover page, and it is usually the section a bank, auditor or court challenges first.

Frequently Asked Questions

What is the difference between IVS and the RICS Red Book?

IVS defines how a valuation must be performed and reported; the RICS Red Book adopts IVS in full and adds professional conduct, competence and quality-control requirements on the valuer. Red Book compliance therefore means IVS methodology plus professional accountability.

Is IFRS 13 a valuation standard?

Strictly it is an accounting standard: it defines fair value for financial reporting and sets the fair value hierarchy and disclosure requirements. Valuations used in financial statements must satisfy IFRS 13 while applying IVS-consistent methodology.

Which valuation standard do UAE authorities require?

UAE authorities, courts and banks accept valuations prepared to recognised international frameworks: IVS, the RICS Red Book, and IFRS 13 for financial reporting. What matters is that the report states its standard, basis of value and methodology clearly enough to be tested.

Can a valuation be prepared to more than one standard at once?

Yes, and often it should be. A financial-reporting valuation, for example, is typically built on IVS-consistent methodology while satisfying IFRS 13's fair value hierarchy and disclosure requirements. Ask your valuer to state every standard the report is prepared under, not just the headline one.

How do I check a valuer is actually qualified to use these standards?

Ask for their professional designation, such as RICS membership or an IVS-recognised credential, and check the report itself states the standard and discloses methodology and assumptions in full. A qualified valuer will not hesitate to show this; a vague answer is itself a warning sign.

Need a valuation prepared to a specific standard?

Assetica prepares valuations to RICS, IVS and IFRS standards, matched to the purpose: banks, courts, auditors, regulators or transactions. Free initial consultation.

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This article is general educational information on valuation standards, not advice on a specific engagement.

Frequently Asked Questions

What is the difference between IVS and the RICS Red Book?

Is IFRS 13 a valuation standard?

Which valuation standard do UAE authorities require?

Can a valuation be prepared to more than one standard at once?

Yes, and often it should be. A financial-reporting valuation is typically built on IVS-consistent methodology while satisfying IFRS 13's fair value hierarchy and disclosure requirements. Ask your valuer to state every standard the report is prepared under.

How do I check a valuer is actually qualified to use these standards?

Ask for their professional designation, such as RICS membership or an IVS-recognised credential, and check the report itself states the standard and discloses methodology and assumptions in full.

Speak to Assetica about Tax, IFRS & Specialist Valuation

Assetica is an independent business valuation firm in Dubai. We do not audit and we do not broker deals, so the number carries no conflict. Read more about tax, ifrs & specialist valuation, or book a free scoping call. Standard reports are issued in five to seven business days.