The Insolvency and Bankruptcy Board of India has issued a circular notifying the International Valuation Standards as the applicable standards for valuations conducted under the Insolvency and Bankruptcy Code, 2016, until further orders.
The circular states that one of the objectives of the Code is the maximisation of value of assets of the corporate debtor in a time-bound manner, and that valuation serves as a critical input for evaluation of resolution plans and facilitates informed decision-making by stakeholders.
“Therefore, transparent, objective, and credible valuation of assets of the CD is fundamental to the effective functioning of the insolvency framework,” it stated.
Accordingly, the Board has directed that valuations shall be conducted in accordance with the International Valuation Standards, as issued and updated from time to time by the International Valuation Standards Council, for the purposes of valuations under the Code and regulations made thereunder.
The circular shall come into force from the date of its issue and shall apply to all valuations conducted under the Code and regulations made thereunder.