ORDER OF THE GOVERNMENT OF THE KYRGYZ REPUBLIC

of April 3, 2006 No. 217

About approval of the standards of assessment of property obligatory to application by all subjects of estimative activities in the Kyrgyz Republic

For the purpose of development of estimative activities in the Kyrgyz Republic the Government of the Kyrgyz Republic decides:

1. Approve the enclosed standards of assessment of property obligatory to application by all subjects of estimative activities in the Kyrgyz Republic:

- standard of the basic concepts and valuation principles;

- standard of business valuation;

- the paragraph the fourth Item 1 ceased to be valid according to the Order of the Government of the Kyrgyz Republic of 15.11.2016 No. 593

- standard of real estate appraisal;

- the standard of requirements to content and report layout about assessment;

- the paragraph of the seventh of Item 1 ceased to be valid according to the Order of the Government of the Kyrgyz Republic of 15.11.2016 No. 593

- standard of assessment of intangible assets and intellectual property items;

- standard of assessment of personal estate.

2. Recognize invalid:

- the order of the Government of the Kyrgyz Republic of November 10, 2002 No. 743 "About approval of the standards of assessment obligatory to application by subjects of estimative activities in the Kyrgyz Republic";

- items 4 and 13 Provisional rules of activities of appraisers and the estimative organizations in the Kyrgyz Republic approved by the order of the Government of the Kyrgyz Republic of August 21, 2003 No. 537 "About development of activities of appraisers and the estimative organizations in the Kyrgyz Republic".

3. To impose control over the implementation of this resolution on management of economic development of the Office of the Prime Minister of the Kyrgyz Republic.

Approved by the Order of the Government of the Kyrgyz Republic of April 3, 2006, No. 217

Standard of the basic concepts and valuation principles

1. General provisions

1. This standard determines concepts, the principles, terminology in the field of property assessment, methodology and procedure for evaluating.

2. Standards of assessment are obligatory to application by subjects of estimative activities in the Kyrgyz Republic in case of determination of cost type, object of assessment, approaches to assessment and evaluation methods, and also when evaluating property value of all patterns of ownership.

3. Subjects of estimative activities are physical persons and legal entities, state bodies and local government bodies within the powers conferred to them, consumers of services (customers).

4. Provisions of this standard are used in other standards in the value established by this standard.

5. Terms and determinations:

Assets - the resources which are in someone's property or under someone's management from which in the future expect receipt of economic benefits.

Updating of assessment - cost determination of object of assessment concerning which the value assessment was carried out earlier, for new date, taking into account possible changes in physical condition of object, its market position and other changes capable to exert impact on project cost.

Business - the type of business and economic activity permitted by the legislation of any Kyrgyz Republic, revenue-producing or other benefits.

Goodwill - capability of the company to gain income of above-average or below-average, any future economic benefits, business-related, the participation rights in business or the sets of assets arising when using which are inseparable from these objects, thanks to prestige, goodwill and contacts of the organization.

Date of assessment - date (number, month, year) for which assessment of property is carried out and its cost is determined.

Personal estate - the objects which are not connected with the earth, not attached to it as stationary objects which allow possibility of movement without loss of essential properties: machines, the equipment, goods, money, securities, debt obligations, etc., or capable to move: vehicles, animal, etc. Carry property in material form to personal estate and the rights to it which is not the real estate.

Cash flow - receipt (increase) and expenditure (reduction) of money and their equivalents.

Discounting of cash flow - transfer of values of future cash flows to their current value, proceeding from the expected value of rate of discount.

Income approach - approach to assessment according to which the property value is determined as the current value of property equal to present value of the expected future income from its use and/or sale, taking into account structure, the income, terms and risks.

The contract for evaluating property - the mutual agreement between the customer and the appraiser on rendering services in property assessment.

The task for assessment - the written instrument which is constituted in case of need / in coordination with the customer and is appendix to the contract for evaluating, containing necessary requirements and information for cost determination of property and being the certificate of unambiguous understanding the parties of content of results of the forthcoming work.

The customer - physical person or legal entity by request of which assessment work is carried out.

Cost approach - approach to value assessment of property according to which the property value consists of purchase costs and/or reconstruction of all components, taking into account all types of depreciation.

Costs - money value of cost of material, labor, financial, natural, information and other types of the resources used in the course of economic activity for certain period of time.

Identification of object of assessment - comparison of the actual physical and functional characteristics of property and property rights for establishment of compliance of the data containing in documentation on assessment object.

Excessive property - property which is not used in economic activity of the company and which maximum value is reached owing to alienation.

Depreciation (impairment) - loss of property value concerning the cost of its reproduction.

Depreciation ineradicable - depreciation of property, costs for which elimination it is more, than the cost added at the same time.

Depreciation cumulative - reduction of project cost of assessment as a result of impact of physical, functional and economic iznos.

Physical wear - partial or total loss of property value because of deterioration in the physical condition caused by its destruction, decrease and natural aging in the course of use throughout service life.

Depreciation functional - the depreciation caused by partial or total loss of functional (consumable) characteristics of object of assessment.

Depreciation economic - economic impairment of property as a result of change of social and economic situation.

Property - the concept applied to designation:

1) sets of the things and material values consisting in property of person (physical and legal), the state or local community, or belonging to the organization on the right of economic maintaining or operational management. Also money, securities and intangible assets are part of property; 2) sets of things and property rights on receipt of things or property satisfaction from other persons (asset); 3) sets of things, property rights and obligations which characterize property status of their carrier (asset and liability).

Capitalization - determination of current value of object of assessment based on the income from its use expected in the future. Capitalization can be performed using capitalization rate (direct capitalization) or discount rates (discounting).

Earnings capitalization - transfer of the income, expected in the future permanent in size, to current value using capitalization rate.

Salvage value - the cost which can be received in case of assessment object sales term in time, being well than the term of exposition of similar property during which it can be sold on market value.

Liquidity - possibility (indicator) of exchange of property for money or their equivalents. In financial accounting degree of liquidity of assets depends on structure of assets and terms of exchange, and is divided on current, urgent and absolute.

Evaluation method - method of cost determination of object of assessment which sequence of accomplishment of estimative procedures gives the chance to implement certain approach to assessment.

The animator of the income - ratio (coefficient) between price indicators of property and size of the income from use of this property.

Real estate (real estate) - the parcels of land, subsoil plots, the isolated water objects and everything that is connected with the earth, that is objects which movement without disproportionate damage to their appointment is impossible, including the woods, long-term plantings, buildings, constructions, etc.

Intangible assets - objects of non-material property (such as the patent, the license, trademark, capability to get profit, copyright or the usage agreement of name and the trademark of firm owner, firm distributor of goods and services, the computer software and others), which can be used in economic activity within at least one year and are subject to depreciation.

Assessment object - property which is required to be estimated.

The valuation report - the document on results of assessment submitted by the appraiser to the customer for confirmation of his professional opinion on property value.

Assessment - the process of determination (calculation) of property value as of specific date which is carried out by the professional appraiser according to these standards with use reasonably of the chosen approaches, methods and assessment procedures, calculation of property value is made in national currency.

Assessment is low-quality, doubtful - assessment which is carried out with violation of the principles, approaches, methods, the estimative procedures provided by standards of assessment.

The appraiser - the physical person who is qualified necessary for rendering estimative services according to the regulatory legal acts regulating estimative activities in the Kyrgyz Republic.

The estimative organization - the legal entity registered in accordance with the established procedure, who is engaged in estimative activities and having at least one appraiser in the state.

Repeated assessment - assessment which is carried out concerning earlier estimated object in case of need of recheck or updatings of the received result. Recheck is carried out in full with observance of all requirements to assessment and registration of its results.

Similar property - property which according to the characteristics and (or) properties as much as possible corresponds to object of assessment and has the same investment appeal.

Disclaimer! This text was translated by AI translator and is not a valid juridical document. No warranty. No claim. More info