Valuation (Spectrum 5.0 consultation draft)

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Scope

Use this procedure when placing a financial valuation on objects, whether your own or borrowed. This is normally for insurance or indemnity purposes (see Insurance and indemnity), but might also be done before acquiring objects by purchase.

Apart from these collection management reasons, it is normally considered unethical to put a commercial value on collections, particularly in the context of financially-motivated disposals. The Museums Association Code of Ethics for Museums gives guidance on this issue.

It is also unwise to give valuations of objects left as enquiries. The terms on the back of the Collections Trust Object entry form say that ‘museum staff are not authorised to give valuations’, and also ‘no valuation indicated verbally or written on this form at the time of deposit will be admitted by the museum.’

The Spectrum standard

You must have a policy on valuation. This could either be a standalone document or part of a wider collections management policy. Either way, you should include answers to these questions:

  • What ethical principles will you apply to object valuation?
  • When will you put valuations on objects?
  • Who is authorised to seek valuations?
  • Who is authorised to provide valuations?
  • Who has access to valuation information and how will you keep it secure?
  • How, and how often, you will update valuation information?

You must also have a written procedure that explains the steps to follow when carrying out valuations. Spectrum’s suggested procedure is a useful starting point, and is available as a workflow diagram or as a text file you can edit. However you do it, your own procedure must meet the following minimum requirements:

Minimum requirement Why this is important See (cross-references to be added in final version)
Valuation information is available as needed for collection management, and is only used in line with current ethical practice. You can insure some or all of your objects appropriately.

You do not use collections as security on a financial loan.

You have agreed and consistent methods for valuation. You have confidence in the valuations that you obtain.

Valuations do not depend on the ‘whim’ of individuals.

Valuation information is treated as confidential, and only available to authorised people. Valuations are only available on a need-to-know basis.

You do not increase the security risk to high-value objects.

Valuations are kept up to date. Incorrect valuations are not used when renewing insurance, leading to inadequate cover.

Feedback

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Responses

  1. Website type: You have agreed and[add] consistent methods for valuation.
    Flowchart error: There should be a ‘No’ option available if you don’t own an object.

  2. Normally the idea was to collect feedback from different museums, but there was only one reaction. It is sad that the time between the anouncement and the deadline for feedback was so little. Hopefully you got many ideas to work with.
    Feedback:
    • The Scope indicates that insurance, indemnity and acquisition are the main reasons for valuation of collection items. I can certainly agree with that, but I also wanted to say that, for example, a federal museums as ours is asked to communicate the value of their collections to the government and, on that basis, will have to be assessed on a larger scale with valuation. This may be seen in a wider trend of awareness of the economic value of museums and their collections and the attempts to use these financial values ​​in an accounting manner.
    • Under ‘standard’ I find the question ‘When will you put valuations on objects?’ Somewhat misleading: is it intended to determine what opportunity a valuation should take place or when will it take place? (I suspect the first one …)
    • The flowchart contains a ‘Yes’ which should actually be ‘No’: the upper ‘Yes’ to the right of the ‘Do you own the objects?’ Box

    1. Another comment:
      to insert best practices (examples as loan agreement, donation agreement,…)

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Date created: 2017

Author: Collections Trust

Publisher: Collections Trust