The common and professionally recommended practice is for the client to retain the valuation firm as a legal entity. This approach provides crucial benefits such as continuity of service, access to firm-wide resources, and coverage under the firm's professional liability insurance. The firm is contractually obligated to complete the engagement, even if the initially assigned appraiser becomes unavailable. However, when testimony is required, the individual expert who performed the analysis testifies based on their specific qualifications, expertise, and professional opinion, as they are the one who must defend the valuation report's conclusions.

A. This is not the standard practice for multi-person firms, as the engagement's legal and financial responsibilities rest with the firm entity.

C. This statement is contradictory. If the individual is retained, the firm has no legal obligation to complete the assignment if that individual cannot.

D. Retaining the firm provides continuity in the retention of records, not discontinuity, which is a primary benefit of engaging a firm over a sole practitioner.

1. NACVA Professional Standards, Section 3.2 - Engagement: "A member shall, before accepting an engagement, inform the client of any limitations on the scope of the engagement... The member shall obtain a written or oral agreement with the client concerning the specific services to be performed." While "member" refers to the individual, the engagement agreement is almost universally executed with the member's firm, which assumes the contractual obligations. The standards implicitly support the firm-level engagement structure for quality control and liability.

2. Hitchner, James R. Financial Valuation: Applications and Models. 4th ed., Wiley, 2017. Chapter 3, "Engagement and Administration," pp. 45-47. This chapter details the process of establishing a valuation engagement. It emphasizes that the engagement letter, the formal contract, is between the client and the valuation firm. This establishes the firm's responsibility for the work product, record retention, and professional liability.

3. Pratt, Shannon P., and Alina V. Niculita. Valuing a Business: The Analysis and Appraisal of Closely Held Companies. 6th ed., McGraw-Hill Education, 2022. Chapter 4, "The Business Valuation Engagement." This text explains that the engagement letter should clearly identify the parties to the agreement, which is typically the client and the valuation firm. This structure ensures professional responsibility and continuity, distinguishing the firm's contractual role from the individual analyst's role as the expert.