Chapter 1 Conta Flashcards
What is the final step in the valution process?
Report the final opinion of value.
The interests, benefits and rights inherent in the ownership of real estate is the definition of?
Real Property
Extraordinary assumption
An assumption directly related to a specific assignment, as of the effective date of the assignment results, which if found to be false, could alter the appraiser’s opinions or conclusions.
Which is first step in the valuation process?
Define the problem.
Scope of Work
The type and extent of research and analysis in an assignment.
Advisory Opinion AO-22
Understanding which analyses, methods and techniques are necessary and what data are necessary to correctly complete the analyses is an intrgral part of the scope-of-work decision. This decision cannot be made competently without understanding how the “conditions” in a market value definition work together with the othr factors identified in compliance with Standards Rule 1-2 to determine what kind of data are relevant and which types of analyses are applicable and necessary in the assignment.
USPAP - Scope Of Work - Standards Rule 1-2(h)
Determine the scope of work necessary to produce credible results in accordance with the SCOPE OF WORK RULE.
SCOPE OF WORK RULE
For each appraisal or appraisal review assignment, an appraiser must:
- identify the problem to be solved;
- determine and perform the scope of work necessary to develop credible assignment results; and
- disclose the scope of work in the report.
An appraiser must properly identify the problem to be solved in order to determine the appropriate scope of work. The appraiser must be prepared to demonstrate that the scope of work is sufficient to produce credible assignment results.
COMMENT: Scope of work includes but is not limited to:
+the extent to which the property is identifed;
+the extent to which tangible property is inspected;
+the type and extent of data researched; and
+the type and extent of analyses applied to arrive at opinions or conclusions.
Standards Rule 2-2(a)(vii)
Summarize the scope of work used to develop the appraisal;
COMMENT: Because intended users’ reliance on an appraisal may be affected by the scope of work, the report must enable them to be properly informed and not misled. Sufficient information includes disclosure of research and analyses performed and might include disclosure of research and analyses not performed.
Workfile
Documentation necessary to support an aprpaiser’s analyses, opinion and conclusions.
RECORD KEEPING RULE
An appraiser must prepart a workfile for each appraisal or appraisal review assignment. A workfile must be in existence prior to the issuance of any report. A written summary of an oral report must be added to the workfile withina reasonable time after the issuanance of the oral report.
What must the workfile includes?
+ the name of the client and the identity, of any other intended users;
+ true copies of any written reports, documented on any type of media (A true cope is a replica of the report transmitted to the client. A photocopy or an electronic copy of the entire report transmitted to the client satisfies the requirement of a true copy.);
+ summaries of any oral reports or testimony or a transcript of testimony, including the appraiser’s signed and dated certification;
+ all other data, informaton and documentation necessary to support the appraiser’s opinions and conclusions and to show compliance with USPAP or references to the location(s) of such other documentation; and,
+ a workfile in support of a Restricted Appraisal Report must be sufficient for the appraiser to produce an Appraisal Report.
RECORD KEEPING RULE
An appraiser must have custody of the workfile or make appropriate workfile retention, access and retrieval arrangements with the party having custody of the workfile. This includes ensuring that a workfile is stored in a medium that is retrievable by the appraiser throughout the prescribed record retention period.
An appaisal having custody of a workfile must allow other appraisers with workfile obligations related to an assignment appropriate access and retrieval for the purpose of:
+submission to state appraiser regulatory agencies;
+compliance with due process of law;
submission to a duly authorized professional peer review committee; or
+compliance with retrieval arrangements.
COMMENT: A workfile must be made available by the appraiser when required by a state appraiser regulatory agency or due process of law.
How long do you have to keep the workfile?
An appraiser must retain the workfile for a period of at least five years after preparation or at least two years after final disposition of any judicial proceeding in which the appraiser provided testimony related to the assignment, whichever period expires last.
Verify
To prove the truth of by the presentation of evidence or testimony; substantiate.
To determine or test the truth or accuracy of, as by comparison, investigation or reference.
