Can You Do a Particular Assignment per USPAP??

USPAP permitted assignments

Yes, I can Accept That Assignment! Types of assignments…

Folks,

The Appraisal Foundation, via John Brenan, has released the following, showing which portions of USPAP apply to particular assignments.

This involves the applicable Standards and Rules.

You may want to print the PDF posted below and keep it under your pillow, or at least with your copy of USPAP!

Yes, I can Accept That Assignment! USPAP Flexibility at a Glance

Some appraisers may not be aware of the inherent flexibility built into the Uniform Standards of Professional Appraisal Practice (USPAP). Because USPAP is a set of standards that is built on the basic principles of ethics and competency, those who do not appreciate such flexibility can sometimes view USPAP as vague. However, the scope of work concept in USPAP enables appraisers to perform many types of assignments while maintaining compliance with standards. Following are examples of such flexibility:

Assignment Types Some Examples Allowed by USPAP? How Does USPAP Apply?
Oral Appraisal Reports A client does not require a written report Yes STANDARDS 2, 8, 10
Purchase Price Negotiation A potential buyer is considering purchasing a property or business Yes STANDARDS 1 & 2, 7 & 8, 9 & 10
Calculation Engagement A CEO is considering an acquisition and wants to know the calculated result given a specific valuation method Yes STANDARDS 9 & 10
Consulting/Appraisal Consulting1 A client is considering developing a vacant parcel and is looking for maximum return Yes Advisory Opinion 21
Appraisals for Litigation/Expert Witness Testimony An attorney needs an impartial opinion of value for legal proceedings Yes STANDARDS 1 & 2, 6, 7 & 8, 9 & 10
Evaluations2 for Lending A lender needs an evaluation providing an opinion of value to ensure a loan is adequately collateralized Yes STANDARDS 1 & 2 and Advisory Opinion 133
Appraisals for lending A lender needs an appraisal providing an opinion of value to ensure a loan is adequately collateralized Yes STANDARDS 1 & 2, 7 & 8
Appraisal Review A client needs to know whether or not an appraisal is credible Yes STANDARD 3
Appraisals for Charitable Contributions An individual donating real or personal property requires a qualified appraisal performed by a qualified appraiser4 Yes STANDARDS 1 & 2, 7 & 8
Appraisals for Estates An executor needs to know the value of property in order to equitably settle an estate; an executor needs to know the Fair Market Value to pay estate taxes Yes STANDARDS 1 & 2, 7 & 8, 9 & 10
Appraisals for Insurance A property owner wants to know how much insurance coverage is adequate; a property owner needs an independent appraisal to help settle a damage/loss claim Yes STANDARDS 1 & 2, 7 & 8
Advocacy An individual who is an appraiser is asked to represent one party in a court proceeding Yes (see footnote) ETHICS RULE and Advisory Opinion 215
Assessment Appeals An appraiser is asked to work for a property owner in an assessment appeals hearing Yes (see footnote) ETHICS RULE and Advisory Opinion 216
Contingent Fee An appraiser agrees to be compensated for the appraisal only when the loan closes No Management Section, ETHICS RULE

As illustrated in the preceding chart, USPAP provides tremendous flexibility for appraisers. The SCOPE OF WORK RULE in USPAP requires appraisers to produce credible assignment results, but USPAP requires only those analyses that are necessary for credible results, given the intended use. In assignments performed for real property, personal property, or business valuation/intangible assets, USPAP also includes provisions for an abbreviated reporting format.7

In order to protect public trust, USPAP does not permit assignments where an appraiser’s fee is contingent on the outcome, or on a subsequent event directly related to the appraiser’s opinions.8


  1. Appraisal consulting is no longer defined in USPAP and the Real Property Appraisal Consulting Standards were retired; however, those services formerly called appraisal consulting are still permitted under USPAP.
  2. As defined in the Interagency Appraisal and Evaluation Guidelines, December 2010.
  3. Advisory Opinion 13, Performing Evaluations of Real Property Collateral to Conform with USPAP, provides guidance on this topic.
  4. Internal Revenue Service, Publication 561.
  5. An individual may provide services as an advocate, or as an appraiser (one who expected to perform in a manner that is independent, impartial, and objective); however, one cannot act in both roles in the same assignment. When acting as an advocate, the individual must not misrepresent his or her role.
  6. Appraisers may perform assignments for assessment appeals, but cannot do so if the fee is based on a percentage of the cost savings or other events as stated in the Management section of the ETHICS RULE. Appraisers must also ensure they do not misrepresent their role in such assignments.
  7. Restricted Appraisal Reports are allowed under STANDARDS 2, 8 and 10.
  8. Management section of the ETHICS RULE.

 

Dave Towne
Latest posts by Dave Towne (see all)
Image credit flickr - With Associates
Dave Towne

Dave Towne

AGA, MNAA, Accredited Green Appraiser - Licensed in WA State since 2003. Dave Towne on e-AppraisersDirectory.com

You may also like...

2 Responses

  1. Baggins Baggins says:

    Great content, thank you.  Would like to see something else like this pertaining specifically to the differences between an evaluation and a price opinion type of reporting approach.  The difference is perhaps in the realm of semantics, but the choice of form is where the rubber hits the road.

    4
  2. Avatar Fred Muth says:

    I’m still a bit confused regarding appraisal consulting. Although retired, is it still considered appraisal practice ?

    0

Leave a Reply

We welcome critical posts & opposing points of view. We value robust & civil discourse. You may openly disagree, but state your case in an atmosphere of mutual respect, in which everyone has a right to a particular view about the topic of conversation. Please keep remarks about the topic at hand, & PLEASE avoid personal attacks. If the poster gets you upset, it is the Internet, you can walk away from it.

Personal attacks harm the collegial atmosphere we encourage on AppraisersBlogs.

Your email address will not be published. Required fields are marked *

xml sitemap

Can You Do a Particular Assignment per USPAP??

by Dave Towne time to read: 2 min
blank
blank
2
blank