The Irish novelist, George Bernard Shaw declared that “all professions are conspiracies against the laity.” Yes, to the extent that someone is required to acquire a distinguishing body of knowledge (BOK) and expertise to qualify as a professional, which BOK and expertise are in turn, released in doses at a fee. But ‘conspiracy’ is a negative concept which is tantamount to illegality, whereas the professions are out to fill missing gaps in the society. Besides, aspects of the core BOK in one field may be scratched by another but usually without the same depth of exploration. Therefore, allied professionals are expected to collaborate rather than engaging in partial or outright competition.

Also, professions like valuation suffer different forms of abuse and usurpation because they are erroneously thought to be foot-loose in nature. While strands of valuation exist in disciplines like accounting, quantity surveying and engineering, these take the nature of evaluation, mathematical analysis and measurements as against wholesome economic-value analysis. Little wonder therefore, that the meaning of ‘valuation’ has been misconstrued by equating the activities of a professional field valuer to that of desktop computation in accounting, technical quality assessment in engineering and the formula-based mathematical analysis of works in quantity surveying.

Perhaps, the valuation profession’s vulnerability is further worsened by the subtle nature of the services rendered, which may not be easily appreciated.In his book “Valuation of tangible and intangible assets”, Ashaolu (2024) lamented the seeming bravery of asset-owners in iterating through outrageous asking prices expecting to reap chance benefits of high negotiated sums. A rational investor would instead, seek professional expertise and guide.

Now, to the meaning of value and valuation proper. Valuation is the determination of the worth of a thing. Value itself is the importance attached to something, extent of its usefulness, or the worth/benefits receivable therefrom. Invariably, things are brought into existence by creation, manufacturing, formation or fabrication to deliver value. For example, every individual is unique, and in turn, possesses one or more attributes (assets) that are required to compliment that of another person. Invariably, the economic value drivers – scarcity, utility, transferability and presence of demand and supply – are satisfied. Thus, anything of value constitutes an asset – living or non-living, tangible or intangible.

To fully appreciate the contextual meaning of value, however, let us look at cost and price. Cost measures the past sacrifice that birthed a thing (yesterday’s invested efforts, time and fund). It is historic and ascertainable with relative precision. However, actual cost is often subjective as against expected (or rational/objective) cost. Conversely, price is current and circumstantial, looking at what the thing can readily fetch in the prevailing market. This is today’s measure and with possible variants (actual or transacted/subjective price, ideal or expected/objective price, asking price etc). Oftentimes, both cost and price are reported, factual figures. Instead, value focuses at the future, mirroring an estimate of the worth of unexhausted utility. Here comes the intrigue because the only thing certain about tomorrow/future is its uncertainty.

Valuers are trained to understand and interpret past and present market dynamics towards reaching competent estimates about the future(poles away from prophecy, star-gazing, speculation or guess-work). Admittedly, however, his value figure is usually not precisely determined but within allowable range.In terms of interrelationships, cost could be price paid plus overhead expenses on transport, borrowing etc while the bridge connecting cost and value is the price. It, therefore, becomes imprudent or irrational for a purchaser to price an asset above its value to him, or for the vendor to part away with his asset for a price that is significantly lower than his value of it. There lies another paradox beckoning an expert valuer – the fact that prospective vendor and purchaser have different values over the same asset.

There are other dimensions to value statements. First, value is not necessarily quoted in monetary terms but could be expressed in relation to a predetermined benchmark or a system of rating. Thus, while one used furniture may be worth around N30,000 in resale, an applicant for the post of Secretary could be rated 68 per cent fit, both representing valuation assessment.

Secondly, one asset could carry as many different types of value as its contemplated use-applications permit. Asking ‘how much is the furniture worth?’ becomes ambiguous. Until the exact purpose for which a client requires valuation is established, the valuer will be unable to chart his course, lacking definite principles to provide framework of action. The same furniture capable of fetching N30,000 in the market may be having depreciated replacement value of N27,000 whereas rebuilding its replica may cost N42,000 (reinstatement-new basis).

Also, the applicant that scored 68 per cent as potential Secretary may, with the same credentials, be found to be 80 per cent fit as Administrative Assistant. There is yet another angle to value definition – temporal. Value is dynamic, as the worth of something often fluctuates with time and circumstance. Our furniture may decline in value some weeks down the line due to mishandling or changes in the economic framework but if preserved long enough, its value may end up increasing astronomically (as antique). Also, the applicant’s score may vary after a while, perhaps for crossing an age-line, acquiring another qualification, emergence of a better competitor etc.A footballer in the transfer market tends to have different values to different teams and even within one team, if he is to be considered in back-defence or front-strike positions, respectively and whether engaged during on-season or off-season periods.

From the foregoing, value determination is not only a daunting exercise but quite an indispensable benchmark for prudent decisions by individual asset-owners, businesses, groups, organisations and the governments. Neglecting it amounts to being penny-wise, pounds-foolish.

For businesses to fully discover the enormity of their assets (especially hidden intangible elements) and avoid frittering them away at ridiculously low prices (perhaps, in an event of bankruptcy or distress), comprehensive valuation must be called for.

• Dr. Ashaoluis is an author and Lagos-based consultant property valuer.