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Getting to CMEA and Staying There

October 15, 2014

NEBBI LendersThere’s a reason we talk a lot about CMEAs at the NEBB Institute. We’re very proud of the fact that we have a designation you know you can trust. Only qualified professionals who meet the Institute’s stringent qualifications earn the designation of a Certified Machinery and Equipment Appraiser (CMEA), so you know if you’re working with a CMEA, you’re working with the best.

To that end, the Institute provides initial and monthly comprehensive education, ongoing support, and a dynamic international network. CMEA candidates must:

  • Attend the Institute’s intensive training class
  • Successfully pass a comprehensive written exam
  • Prepare a sample Appraisal Report that conforms to guidelines set forth by the Uniform Standards of Professional Appraisal Practice (USPAP). The report is graded by two Certified Appraisers and must pass the scrutiny of the Institute’s Peer Review Committee
  • Attend a CMEA refresher course once a year
  • Comply with continuing education requirements mandated by the Institute
  • Comply with the ethics rule of the Uniform Standards of Professional Appraisal Practice

So you can see that becoming and remaining a CMEA takes a high level of commitment, focus, and passion, and we wouldn’t have it any other way.

The NEBB Institute endorses and strives to observe the highest standards of professional ethics to preserve the public trust inherent in the professional appraisal practice. The Institute provides initial and monthly comprehensive education, ongoing support, and a dynamic international network, and certifies professionals in the art of machinery/equipment appraisal and brokerage.

By: NEBB Institute

Three Mistakes Lenders Make When Determining the Value of Borrowers’ Equipment

October 8, 2014

NEBBI LendersAfter weathering the economic downturn, lenders know better than anyone the importance of doing due diligence before granting a loan to a business. SBA backed lenders are once again lending money, but with caution. One of the ways they exercise this caution is to conduct their own appraisals of collateral. This ensures that they will be able to recoup their losses in the event of a default. When determining equipment values, lenders should carefully avoid these three mistakes:

Mistake #1: Relying on the word of an uncertified person to deliver a value on equipment.

Auctioneers and dealers could have a hidden agenda. Most of these people are not certified appraisers or trained in providing USPAP-compliant appraisal reports. A Certified Machinery and Equipment Appraiser (CMEA) who is a member of the NEBB Institute exceeds the experience and training requirements many governing authorities hold. Ask if your appraiser is certified. If not, you open yourself to greater cost, liability, risk, and an unsubstantiated equipment appraisal.

Mistake #2: Guessing at equipment values.

Guessing is a huge risk because your loan file won’t have the substantiation needed to support a loan decision.

Mistake #3: Relying on the depreciation schedule.

A depreciation schedule is only important to the business owner, CPA, and the IRS and will not provide the fair market value, orderly liquidation value, or forced liquidation value.

Every day bankers and lenders are asked to make decisions that involve determining a realistic, independent value for machinery or equipment.

If you are a lender, making loans to small businesses so they can purchase machinery or equipment, be sure that the appraisal is conducted by a certified professional.

The NEBB Institute endorses and strives to observe the highest standards of professional ethics to preserve the public trust inherent in the professional appraisal practice. The Institute provides initial and monthly comprehensive education, ongoing support, and a dynamic international network, and certifies professionals in the art of machinery/equipment appraisal and brokerage.

By: NEBB Institute

Advanced Appraisal Designations

October 1, 2014

NEBBlogoAlthough we mostly discuss Certified Machinery and Equipment Appraisers (CMEAs) here at NEBB Institute, the fact is that there are plenty of other professional designations in our industry that qualify appraisers for all sorts of different appraisal scenarios.

For example, there’s the NEBB Institute’s MCMEA (Master Certified Machinery/Equipment Appraiser) designation. MCMEAs provide needed financial information to banks, certified public accountants, law firms, and those who are buying or selling a business.

There’s also the CEB (Certified Equipment Broker) credential. CEBs can professionally, effectively, and efficiently broker all types of equipment for their clients.

Then there’s the CBI (Certified Business Intermediary) designation, awarded to those who complete an extensive educational curriculum and demonstrate superior knowledge and experience in the business brokerage profession. The CBI is awarded by the International Business Brokers Association (IBBA).

And lastly, there’s the CSBA (Certified Senior Business Analyst) designation, awarded by the International Society of Business Analysts, given to those who demonstrate competence and expertise in business valuation, business transfers, succession planning, consulting, and business turnarounds.

For more information about these and other advanced designations, contact us today!

The NEBB Institute endorses and strives to observe the highest standards of professional ethics to preserve the public trust inherent in the professional appraisal practice. The Institute provides initial and monthly comprehensive education, ongoing support, and a dynamic international network, and certifies professionals in the art of machinery/equipment appraisal and brokerage.

By: NEBB Institute

 

International Valuation Standards and Who Sets Them

September 25, 2014

There isn’t much variation in appraisal rules from one state to another. Each individual market varies a little depending on demand for a piece of machinery or equipment, but each asset in a west coast state would be treated (and likely valued) just like a piece of equipment in an east coast state.

But what happens in other countries?

That’s why the International Valuation Standards Council (IVSC) exists. Headquartered in London and incorporated in the US, the IVSC is a non-profit organization that creates and supports international appraisal standards that will be relied upon by investors and other third-party stakeholders. The organization is made up of major valuation standard-makers and professional associations from more than 40 different countries.

But those aren’t the only goals of the IVSC. They also:

  • Facilitate collaboration and cooperation among member organizations
  • Collaborate and cooperate with other international organizations
  • Serve as the international voice for the valuation profession

The IVSC publishes the International Valuation Standards (IVS) and associated technical guidance.

The NEBB Institute endorses and strives to observe the highest standards of professional ethics to preserve the public trust inherent in the professional appraisal practice. The Institute provides initial and monthly comprehensive education, ongoing support, and a dynamic international network, and certifies professionals in the art of machinery/equipment appraisal and brokerage.

By: NEBB Institute

 

Standards of Valuation Practice Released

September 17, 2014

NEBBI Appraisal ValuesAs we’ve stated on countless occasions within this blog, CMEAs are required to adhere to the Uniform Standards of Professional Appraisal Practice (USPAP). This ensures that any appraisal report you receive from a CMEA will be irrefutable, defensible, and withstand scrutiny.

But just because NEBBI lives in a USPAP world, we acknowledge that there are certain types of appraisals where USPAP is not required. Up until recently, there was a gap regarding the standards that should be used in those situations. So earlier this month, the Appraisal Institute presented its Standards of Valuation Practice (SVP).

Ken Wilson, president of the Appraisal Institute, said “The SVP will establish a higher level of professional practice, engender public trust and facilitate the growth and advancement of the valuation profession…The SVP will recognize the broad area of practice of valuation professionals and the diverse needs of users of valuation services.”

SVP is not intended to replace USPAP in any way, but rather complement the industry standards when necessary. If you’re curious about what’s contained in SVP, you can check it out here.

The NEBB Institute endorses and strives to observe the highest standards of professional ethics to preserve the public trust inherent in the professional appraisal practice. The Institute provides initial and monthly comprehensive education, ongoing support, and a dynamic international network, and certifies professionals in the art of machinery/equipment appraisal and brokerage.

By: NEBB Institute

 

NEBBI Training Addresses Your Learning Style

September 10, 2014

NEBBlogoPeople learn best in different ways — some people enjoy lectures and others enjoy reading. Some like self-directed study while others prefer collaborating with a group. No matter your preferred method of learning, the NEBBI’s CMEA training works to suit your unique learning style.

If in-person instruction is your thing, you can attend one of our classes, during which you can expect two days of intensive instruction at convenient locations throughout the United States from NEBBI. This method of instruction also allows you to network with other new NEBB Institute members. When the class ends, you’ll have the CMEA professional designation.

If you prefer classes in the convenience of your own home, the NEBBI offers online classes. These are conducted via conference call with other new NEBBI members. All you have to do is watch your computer monitor, listen to the instructor, and follow the lesson in your CMEA Training Manual. Active participation is expected from trainees.

No matter which method you choose, you can expect to learn a set of basic skills. These include:

  •        The ethics, rules, and regulations of the Uniform Standards of Professional Practice (USPAP)
  •        Typical reasons for appraisals
  •        The intricate steps involved in conducting an appraisal
  •        Locating comparables
  •        NEBBI’s exclusive Appraiser’s Database
  •        The engagement and data collection
  •        Sample Summary Appraisal Report
  •        Written review for CMEA professional certification

Join us for our next training session!

The NEBB Institute endorses and strives to observe the highest standards of professional ethics to preserve the public trust inherent in the professional appraisal practice. The Institute provides initial and monthly comprehensive education, ongoing support, and a dynamic international network, and certifies professionals in the art of machinery/equipment appraisal and brokerage.

By: NEBB Institute

 

Appraisal Reviews and the Rebuttal Process

September 3, 2014

NEBBlogoLet’s say you ordered an appraisal of your machinery and equipment. You hired a certified appraiser who put together a detailed report of the value of your items, along with supporting documentation and how they were able to derive the value.

But what if you disagree with the appraiser’s opinion. Is it set in stone?

By no means. You have every right to voice your opinion on the appraiser’s opinion, so you can order an appraisal review. During this review, if the reviewer points out issues with which the appraiser doesn’t agree, the appraiser can provide a written rebuttal to explain why they believe they’re correct.

Since they have an interest in defending the original appraisal, the appraiser can, at least indirectly, offer an opinion on the quality of another appraiser’s work that was performed as part of an appraisal review, or that in the rebuttal the appraiser may not be able to be objective and unbiased.

USPAP states that an appraiser can defend (or explain) his or her appraisal, as long as they don’t offer an opinion on the quality of another’s work. A rebuttal where an appraiser simply provides additional rationale or support for his or her analyses, opinions, and conclusions is an acceptable practice.

Appraisals are supposed to be fair, impartial, and unbiased. But even if they are, there’s no guarantee that everyone’s going to agree with them.

The NEBB Institute endorses and strives to observe the highest standards of professional ethics to preserve the public trust inherent in the professional appraisal practice. The Institute provides initial and monthly comprehensive education, ongoing support, and a dynamic international network, and certifies professionals in the art of machinery/equipment appraisal and brokerage.

By: NEBB Institute

 

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