The Ministry of Corporate Affairs (MCA) is mulling setting up of an institute of valuers to help companies in assessing their valuation, particularly during mergers and acquisitions.
"The ministry is planning setting up of an institute of valuers just like we have the Institute of Chartered Accountants of Indian and Institute of Company Secretaries. A new bill will be passed to this effect. The ground work is being done," a senior ministry official told PTI.
At present, the valuation is done by chartered accountant, cost and works accountant, company secretary or any other person possessing such qualifications.
The idea comes in the wake of the new Companies Bill, 2008, which provides for the fair valuation of shares or properties in case of M&As or allotment of shares for consideration other than cash.
The ministry is planning the institute with the motive of churning out people having specialised knowledge, he said.
According to the Companies Bill, 2008, "enabling provisions have been made to facilitate valuation of shares companies involved in the scheme of M&As or those which allot shares for consideration other than cash, by independent registered valuers."
The bill says that the appointment of valuers shall be made by the audit committees. The bill also suggested the government to maintain a record of such valuers.