What is Accredited In Business Valuation (ABV)
Accredited in Business Valuation (ABV) is a professional designation awarded to CPAs who specialize in calculating the value of businesses. The ABV certification is overseen by the American Institute of Certified Public Accountants (AICPA) and requires candidates to complete an application process, pass an exam, meet minimum Business Experience and Education requirements, and pay a credential fee (as of 2018, the annual fee for the ABV Credential was $380). Maintaining the ABV credential also requires those who hold the certification to meet minimum standards for work experience and lifelong learning. Successful applicants earn the right to use the ABV designation with their names, which can improve job opportunities, professional reputation and pay.
Breaking Down Accredited In Business Valuation (ABV)
The Accredited in Business Valuation credential is awarded to Certified Public Accountants who demonstrate considerable knowledge, skill and experience in business valuation. The study program to become an ABV covers the basic business valuation process, professional standards, qualitative and quantitative analysis, valuation analysis and other related topics, such as financial reporting and litigation. Individuals with the ABV designation may work for business valuation firms, consulting firms and other business that regularly deal with business value. For more, see the AICPA's ABV Credential Overview.
Accredited In Business Valuation Requirements
Candidates seeking ABV accreditation must have a valid (and unrevoked) CPA license or certificate issued by the appropriate state authority. They must also pass the ABV Examination, with some exceptions. For example, this requirement is waived in the case of AM (Accredited Member of the ASA) and ASA (Accredited Senior Appraiser) credential holders of the American Society of Appraisers, CFA (Certified Financial Actuary) holders and CBV (Chartered Business Valuator) credential holders of the Canadian Institute of Chartered Business Valuators. Every three years, ABV professionals must complete 60 hours of continuing professional education every three years (see ABV Recertification Requirements). They must also pay an annual fee of several hundred dollars.
The Business Experience and Education requirements for the ABV are as follows:
- Business Experience: ABV candidates must have obtained a minimum of 150 hours of BV experience within the 5-year period preceding the date of the credential application. Candidates may also apply a maximum of 15 experience hours by completing the hands on business valuation case study track at the AICPA Forensic and Valuation Services Conference. Refer to the ABV Credential Application Kit for examples of business experience.
- Education Requirement: ABV candidates must complete 75 hours of valuation-related continuing professional development (CPD). All hours must be obtained within the 5-year period preceding the date of the ABV application. Refer to the ABV Credential Application Kit for further details.
For more, see the AICPA's Eligibility Requirements web page.
Accredited In Business Valuation Exam
The ABV Exam is conducted by computer and consists of two parts. Both parts must be passed in a 12-month period (based on the date of passing the first part) to receive ABV credit. ABV candidates are given 3 hours and 15 minutes to complete each part, including a 15-minute break. The exam consists of 90 multiple-choice questions per module. Much of the exam are discrete multiple-choice questions (78 in total). A dozen questions are case studies with accompanying multiple-choice answers. These questions are meant to test a candidate's analytical aptitude and ability to apply valuation theory and methodology. For more, see the AICPA's ABV Exam Content Specification Outline.
During the exam, candidates are allowed computer to the International Glossary of Business Valuation Terms and Formulas & Variable Definitions. The AICPA also provides a mock exam video; the questions are for demonstration purposes and are not actual exam content.