Chapter 8 Standards 2

Question 1

STANDARD 2 addresses

Answer 1

the reporting (written or oral) of a real property appraisal. The Standard states: In reporting the results of a real property appraisal, an appraiser must communicate each analysis, opinion, and conclusion in a manner that is not misleading.

Question 2

STANDARD 2 establishes requirements for

Answer 2

communicating (reporting) real property appraisal assignments.

Question 3

Definition of Report

Answer 3

Any communication, written or oral, of an appraisal or appraisal review that is transmitted to the client or a party authorized by the client upon completion of an assignment.

Question 4

Standard 2 consists of how many rules?

Answer 4

6

Question 5

STANDARD 2 sets forth requirements for

Style and format of a real property appraisal report
The use of standard appraisal forms
Appraisal report content

Answer 5

Appraisal Report Content

Question 6

The use of standard appraisal reporting forms
Is prohibited by USPAP
Requires approval by the ASB and AQB
Is mandated by STANDARD 2
Is not required by STANDARD 2

Answer 6

Is not required by STANDARD 2

Question 7

Standards Rule 2-2 is titled Content of a Real Property Appraisal Report. It begins:

Answer 7

Each written real property appraisal report must be prepared under one of the following options and prominently state which option is used: Appraisal Report or Restricted Appraisal Report.

Question 8

Advisory Opinion 38 is titled

Answer 8

Content of an Appraisal Report and Restricted Appraisal Report. It is applicable in real property, personal property, and intangible property appraisals.

Question 9

What is the essential difference between the two reporting options?
The report form and format prescribed by USPAP
An Appraisal Report is the shorter and more abbreviated option
The content and level of information
A Restricted Appraisal Report does not require the appraiser to maintain a workfile

Answer 9

The content and level of information

Question 10

The two written report options stated in Standards Rule 2-2 are
Form Report and Narrative Report
Written Appraisal Report and Electronic Appraisal Report
Appraisal Report and Automated Valuation Model
Appraisal Report and Restricted Appraisal Report

Answer 10

Appraisal Report and Restricted Appraisal Report

Question 11

Standards Rule 2-2 has two subsections:

Answer 11

SR 2-2 (a) establishes minimum content for an Appraisal Report
SR 2-2 (b) establishes minimum content for a Restricted Appraisal Report

Question 12

Standards Rule 2-2(a)(i)

The content of an Appraisal Report must, at a minimum:

Answer 12

state the identity of the client; or if the client requested anonymity, state that the identity is withheld at the client’s request but is retained in the appraiser’s workfile

Question 13

The content of an Appraisal Report must, at a minimum:

Answer 13

state the identity of any other intended user(s) by name or type

Question 14

An appraiser’s client requests anonymity and asks that their identity not appear in the Appraisal Report that is prepared for the assignment. What must the appraiser do?
State in the report that the client’s identity has been withheld at the client’s request
Use care not to violate the Confidentiality section of the ETHICS RULE
All of these actions must be taken
Document the identity of the client in the workfile

Answer 14

All of these actions must be taken

Question 15

When reporting the results of an appraisal, dates that must be included are
Effective date and report date
Inspection date and assignment date
Inspection date and report date
Effective date and inspection date

Answer 15

Effective date and report date

Question 16

Which of the following is NOT required by USPAP to be in an Appraisal Report?
Client's specific name
Name or type of other intended users
Effective date of appraisal
Type and definition of value

Answer 16

Client’s specific name

Question 17

An appraiser determines that the cost approach is not necessary in an appraisal assignment, and therefore does not develop the approach. In the Restricted Appraisal Report for the assignment, what must the appraiser do?
Develop the approach and keep it in the workfile in case the client wants it later
Develop the approach and put in the report anyway
State the reason for the exclusion of the approach
Omit the approach from the report without mentioning it

Answer 17

State the reason for the exclusion of the approach

Question 18

In an Appraisal Report, the scope of work used to develop the appraisal must be
stated
summarized
described
omitted

Answer 18

Summarized

Question 19

All written appraisal reports must contain
maps, sketches, and photographs
a letter of transmittal
adequate detail to allow any reader to understand the appraisal process

Answer 19

A signed certification

Question 20

When an extraordinary assumption is used in an appraisal, the report must state the extraordinary assumption and
provide proof of client approval for the extraordinary assumption
also value the property without the extraordinary assumption
state that its use may have affected the assignment results
explain it in an addendum to the report

Answer 20

State that its use may have affected the assignment results

Question 21

An appraiser is preparing a Restricted Appraisal Report in a situation where there are intended users in addition to the client. Which statement is true regarding this situation?
These additional intended users must be identified in the report by name.
These additional intended users may be identified in the report by either name or type.
These additional intended users must be identified in the report by type.
The appraiser has violated USPAP by using a Restricted Appraisal Report in this situation.

Answer 21

These additional intended users must be identified in the report

Question 22

According to USPAP, any appraiser who signs any part of an appraisal report is required to
read the report
sign a certification
sign the letter of transmittal
inspect the property

Answer 22

Sign a certification

Question 23

Which of the following best describes bias in appraisal practice?
It is not permitted
It is permitted in market analysis
It is allowed, as long as it is disclosed in the report
It is acceptable if disclosed prior to accepting the assignment

Answer 23

It is not permitted

Question 24

What is the purpose of including a signed certification in an appraisal report?
Because it is required by Fannie Mae
To prove that an actual written report was provided by the appraiser
To certify that the appraiser was of sound mind
For the appraiser to acknowledge his or her ethical obligations

Answer 24

For the appraiser to acknowledge his or her ethical obligations

Question 25

To the extent possible and appropriate, oral appraisal reports for real property must address the substantive matters that apply to a(n) Appraisal Report Appraisal Review Report Restricted Appraisal Report

Answer 25

Appraisal Report

Question 26

An appraiser provides an oral report of a real property appraisal. Which statement is CORRECT? The appraiser must send a written, signed, and dated certification to the client after she provides the oral report. The appraiser must add a signed and dated certification to her appraisal workfile. The appraiser has no USPAP reporting obligations because she provided an oral report. Because she gave an oral report, the appraiser does not have to sign a certification.

Answer 26

The appraiser must add a signed and dated certification to her appraisal workfile

Question 27

An appraiser was engaged by Client A to appraise a property. The appraiser delivered the appraisal report to Client A. The client has decided not to pursue the transaction that generated the need for the appraisal report. The appraiser is contacted by Client B. Client B requests that the original report be readdressed (transferred) by replacing Client A’s name with Client B’s name in the report. Is this acceptable?

Answer 27

No. Simply changing the client name on the report cannot change or replace the original appraiser-client relationship that was established with Client A. Therefore, this action is misleading.

Question 28

Under what circumstances can an appraiser agree to perform an assignment to appraise a property for a prospective client when that appraiser has previously completed an appraisal of the same property for another client?

Answer 28

Agreeing to perform the assignment from the subsequent prospective client is not prohibited by USPAP, assuming appropriate disclosure is made to the client before being engaged and any existing confidential information is handled properly.

Question 29

USPAP requires an appraiser to obtain a release from a previous client before appraising the same property for a new client. True False

Answer 29

False

Question 30

``` If a client requests a more current valuation on a property that was the subject of a prior assignment, this is a(n) ____________. appraisal consulting assignment extension of a prior assignment recertification of value new assignment ```

Answer 30

New Assignment

Question 31

An appraiser completes an appraisal for Bank A. Two months later, he is contacted by Bank B, who asks him to “readdress” his prior report to them. Which statement is TRUE about the appraiser's USPAP obligations? He can “readdress” the report if he obtains permission from Bank A. He is not permitted to do a new appraisal for Bank B because he appraised the same property for Bank A within the last three years. He can “readdress” the report only if the value and/or market conditions have not changed. He is not permitted to “readdress” the report to Bank B.

Answer 31

He is not permitted to "readdress" the report to Bank B

Question 32

A trainee assisted a senior appraiser in an appraisal assignment, but the trainee appraiser does not sign a certification. The trainee’s name is stated in the certification as having provided significant appraisal assistance. Is a description of the trainee’s assistance also required to be in the certification? No Yes USPAP is silent on this issue

Answer 32

No

Question 33

If a supervising appraiser makes changes to a trainee's appraisal report which the trainee does not agree with, the trainee should not sign the certification sign the certification because the supervisor knows best give the supervisor blanket permission to sign all reports for him

Answer 33

Not sign the certification