Department of Real Estate

Faculty of Architechture, Planning and

Surveying.
UNIVERSITY TECHNOLOGY MARA.

Subject;

APPLIED VALUATION EMT 651

(Plant and Machinery Valuation)

(KHOLIM SAHRAY)

“INTRODUCTION”
The Plant and Machinery valuation is a multi-
disciplinary subject involving Law,
Economic, Accountancy, Insurance,
Planning, Environmental science, Industry
Processing/Engineering and etc. over and
above techniques of valuation, the valuer
has to work as a team leader and he/she
must possess the expertise to weigh
appropriately all information collected
from various sources (Budhbhatti, 1992).
Real estate appraisal, property
valuation, land valuation or
plant and machinery valuation
are the practices of developing
an opinion of the value of real
property, plant or machinery.
Opinion of value usually refers
to the Open Market Value”
According to the Valuers, Appraisal and
Estate Agent Act 1981, Valuer has
been given the authority to value
properties including Plant and
Machinery. However due to lack of
knowledge and experience about the
Plant and Machinery among valuers,
this profession has been monopolised
by other professional such as
Accountants and Mechanical
Engineers
History of P&M valuation

UK – Mid 19th century, during industrial

revolution, mainly for insurance purpose. Large
growth during asset stripping takeovers of
1960’s.

Malaysia – Profession still in its infancy – very

little organization recognized P&M valuer. Why?
– No legal requirement, banking practice on
traditionally lending only and others on a
regulation requirement.
 
The industrial sector is expanding tremendously and
this situation will lead to the increment of the
numbers of Plant and Machinery especially in the
low and medium industry sector. Indirectly this will
increase the needs of Plant and Machinery
Valuation. However, in Malaysia there are no
intensive and aggressive efforts being done to
generate knowledge and exposure to the Valuers on
the Plant and Machinery Valuation.
Real estate appraisal, property
valuation, land valuation or
plant and machinery valuation
is the practice of developing an
opinion of the value of real
property, plant or machinery”

And the purpose of valuation

usually either for the financing,
insurance, Goodwill , or internal
management purpose
Opinion of value usually refers to
the Open Market Value. There are
three general groups of
methodologies for determining
market value:-
  
1.The cost approach,
2.The sales comparison approach
and;
3.The income approach.
Valuation of Plant and Machinery is a jurisdiction
that needs specialization of skill and exercise,
Therefore at the end of this course student should
be able to have:

A basic standard or guidelines in determining the

Value of the Plant, Machinery And
Equipment.

A Standard of procedure on Plant and Machinery

Valuation processes,

A knowledge and exposure in valuing Plant and

Machinery.