RICS has launched a public consultation on the RICS Red Book UK Supplement for feedback on proposals for a time-limited, mandatory rotation cycle for regulated purpose valuations, proposals to ensure an orderly transition to the policy, and proposals to standardise governance and prevent conflicts of interest in the commissioning and receiving of valuation reports.
This consultation progresses recommendations from the valuation review, published in January 2022 following a public call for evidence. The review was commissioned by the RICS Standards and Regulation Board to future-proof practices in the valuations of real estate assets for investment purposes in the public interest.
The proposed changes for consultation concern those involved in instructing or undertaking regulated purpose valuations upon which third party reliance is placed, such as for financial reporting, takeovers and collective investment schemes.
Feedback from a wide range of stakeholders on how the proposed changes will affect those working in an auditing capacity on regulated purpose valuations, those working for organisations commissioning and receiving valuations, or those acting on the outputs of such valuation reports is essential.
An orderly transition to any new regulatory arrangements and standards is essential so the proposed transition policy, which is subject to this consultation, seeks to provide clients with a reasonable timescale to transition, with changes proposed to come into effect by 1 October 2023.
The valuation review has been shaped through public consultation, which began in 2020, and the proposals in this consultation were informed by a formal call for views and engagement with many stakeholders, including with those commissioning, undertaking, auditing, and regulating valuations.
It is intended that once feedback from this consultation has been received and carefully reviewed, the wording of any changes will be finalised and approval of the terms will be sought from the RICS Standards and Regulation Board.
RICS welcomes responses from ICAEW members to ensure the views of this sector are captured. You can read the full proposals and feed into the consultation before 14 December via the RICS valuation review web hub.
*The views expressed are the author’s and not ICAEW’s