Business and Property Valuation

BUSINESS AND PROPERTY VALUATION

Volume of the course: 4 credits.

Goals and intended skills: The purpose of the program is to advance students' theoretical knowledge of business and property valuation, understanding of methodology of business and property valuation, method selection procedures and specific features, to familiarise with Lithuanian system of business and property valuation. Students should also understand functioning of property market, legal regulation of business and property valuation, specifics of property valuers. Understanding of the notion of value is necessary when evaluating property and business, also understanding of the main factors determining value of property and business.

Brief annotation: Notion, assumptions and methods of property and business valuation. Methodology of assets and property valuation, principles of business valuation. Detailed material on Lithuanian system of property and business valuationis provided, with focus on legislative regulation and current legislative framework. Comparison of the Lithuanian system with foreign systems of property and business valuation. Requirements raised towards property and business valuers, as laid down in the Law on Foundations of Property and Business Valuation of the Republic of Lithuania. The program is also intended to familiarise the students with real estate market and aspects of real estate valuation.

Topics: Property as economic category in the context of valuation (1 hour of lectures).Property market (1 hour of lectures and 0.5 hour of seminars). Property and business valuation system in Lithuania (2 hours of lectures and 0.5 hour of seminars). Property and business valuers (1 hour of lectures and 1.5 hours of seminars). Legislative regulation of property and business valuation system (1 hour of lectures). Theoretical foundations of property and business valuation (1 hour of lectures). Methodology of property and business valuation (2 hours of lectures and 1.5 hours of seminars). Systematic nature of business valuation (1 hour of lectures).

Content of practical training: Survey of real estate market as a type of property markets. Review of property and business valuation system in Lithuania, highlights of its advantages and shortcomings. Discussion of property and business valuers, respective requirements, problems of professional ethics of property valuers. Practical application of various property and business valuation methods, performance of experimental calculations with actual data.

Teaching methods: lectures and seminars.

Attendance requirements: attendance of lectures is not and attendance of seminars is mandatory.

Procedure for assessment of knowledge and skills: examination. Accumulative assessment score: 60% examination, up to 40% activity in seminars.

Requirements: master students must have attended courses of microeconomics, macroeconomics and business economics.

Coordinating lecturer: Prof. Hab. Dr. A. V. Rutkauskas, lect. V. Azbainis

Recommended Literature:

No. / Edition
date / Authors and title
of publication / Publishing house / No. of copies in University library
1. / 2008 / Baum A., Crosby N. Property Investment Appraisal. 3rd edition / Blackwell Publishing / -
2. / 2005 / Brueggeman W., Fisher J. Real estate finance and investments. 13th edition / New York: McGraw-Hill / -
3. / 2000 / Copeland T., Koller T., Murrin J. Valuation: Measuring and Managing the Value of Companies. 3rd edition / New York: Wiley / -
4. / 1998 / Cyril Pat Obi. Verslo finansų pagrindai [Foundations of Business Finances]. / Kaunas: Technologija / 14
5. / 2005 / Galinienė B. Turto ir verslo vertinimo sistema [Property and Business Valuation System]. / VilniusUniversity Press / 2
6. / 1997 / Linkoln W. North. Turto vertinimo praktika Vidurio ir Rytų Europoje [Property Valuation Practice in Central and Eastern Europe]. / Lithuanian Associaton of Property Valuers / -
7. / 1994 / Lumby S. Investment Appraisal and Financial Decisions. 5th edition. London: Chapman & Hall / London: Chapman & Hall / 1
8. / 1998 / Mackevičius J., Poškaitė D. Finansinė analizė [Financial Analysis]. / Vilnius: Katalikų pasaulis / 1
9. / 2001 / Rutkauskas A. V. Nekilnojamojo turto plėtotė, investicijos ir rizika [Development of Real Estate, Investments and Risk]. / Vilnius: Technika / -
10. / 2000 / Šlekienė D., KlimavičienėI. Įmonės veiklos finansinis įvertinimas [Financial Assessment of Activities of a Company]. / Kaunas: Technologija / 6

Additional sources:

11. / 2000 / Barker R. Determining Value: Valuation Models and Financial Statements. First edition. / New Jersey: Prentice Hall / -
12. / 1994 / Betts R. M., Ely S. J. Basic Real Estate Appraisal. 3rd edition. / New Jersey, Suglewood Cliffs, USA / -
13. / 2002 / Galinienė B. Training of Lithuanian Property Valuers in the Context of European Area // Ekonomika. 2002, No. 60, p. 17-28. / -
14. / 2003 / Galinienė B., Šopienė I. Draudžiamo nekilnojamojo turto vertės nustatymo metodiniai aspektai [Methodical Aspects of Determination of Value of Real Estate to be Insured] // Pinigų studijos. 2003, No. 2, p. 60-73. / -
15. / 1999 / Galinienė B., Marčinskas A. Turto vertinimo sistema [System of Property Valuation] // Apskaitos ir mokesčių apžvalga. 1999, No. 3, p. 65-69. / -
16. / 2002 / Long-Term Strategy of Lithuanian Economy Development till 2015. Vilnius, 2002. / -
17. / 2000 / Malienė V. Nekilnojamojo turto vertinimas dauguiakriteriniais analizės metodais [Valuation of Real Estate Using Methods of Multi-Criteria Analysis]: Doctoral thesis. / Vilnius: Technika / -
18. / 2006 / McMahan J. The Handbook of Commercial Real Estate Investing. / New York: McGraw-Hill / -
19. / 2005 / Šulija V. Nekilnojamojo turto masinio vertinimo ir apmokestinimo problemos [Problems of Mass Evaluation and Taxation of Real Estate]: Doctoral thesis. / Vilnius: MykolasRomerisUniversity. / 1
20. / 2004 / Zavadskas E. K. A significant stage in the property and business evaluation system: reviews Ekonomika: mokslo darbai. Vol. 68 (2004), p. 135-137.
21. / 1998 / Белокрыс А. М., Болдырев В. С., Зарубин В. Н. Оценка рыночной стоимости недвижимости. Академия народного хозяйства при Правительстве РФ. / Москва: Дело / -
22. / 1997 / Григорьев В. В., Сегидинов А. А., Федотова М. А. Оценка объектов недвижимости: теоретические и практические аспекты: Учеб. Пособие. / М.: Инфра-М / -
23. / 1997 / Тарасевич Е. И. Оценка недвижимости. / Санкт-Петербург / -
24. / 1999 / Богатин Ю.В., Швандар В.А. Оценка эффективности бизнеса и инвестиций: учебное пособие для вузов. / Москва: Финансы: ЮНИТИ-ДАНА / -

Useful websites:

Lithuanian Association of Property Valuers -
Ministry of Economy of the Republic of Lithuania -
Auditing, Accounting and Property Appraisal Institute of Lithuania -
State Property Fund -
Law on Foundations of Property and Business Valuation of the Republic of Lithuania -
Property Valuation Methodology -
Real Estate Valuation Rules -
Code of Professional Ethics of Property Valuers. As approved by the Council of LR Auditing, Accounting and Property Appraisal Institute 14 September 2000, Resolution No. 27-7.-

Prof. Hab. Dr. A. V. Rutkauskas, lect. V. Azbainis