A client engages an appraiser to evaluate the quality of another appraiser's report. Standard 3 governs:
Correct Answer
A) The development of an appraisal review
Standard 3 governs development of appraisal review, and Standard 4 governs communication of its results. The reviewer develops a credible opinion about the quality of the work reviewed under the identified problem and scope; an own-value opinion adds the applicable development and reporting duties. USPAP’s Rules also apply, but issues such as scope identification and certification have relevant provisions in Standards as well. Do not assume any mention of scope or competency makes a numbered Standard irrelevant.
Why This Is the Correct Answer
Option A is correct because Standard 3 sets the general development requirements for an appraisal review, including the duties in Standards Rule 3-1. An appraiser giving an opinion about the quality of another appraiser's work must also comply with the Scope of Work Rule, the Record Keeping Rule and applicable portions of Standards 3 and 4. Standard 4 handles communicating the review results.
Why the Other Options Are Wrong
Option B: The reporting of a mass appraisal
Option B says Standard 3 governs the reporting of a mass appraisal. Mass appraisal reporting falls under Standard 6, not Standard 3.
Option C: The valuation of personal property and assets
Option C says Standard 3 governs valuation of personal property and assets. Personal property appraisal is covered by Standards 7-8, not Standard 3.
Option D: The retention period for workfiles
Option D says Standard 3 governs the retention period for workfiles. Workfile retention is addressed by the Record Keeping Rule, not Standard 3.
Odd develops, even reports
In each USPAP pair, the odd standard covers development and the even one covers reporting, so Standard 3 develops a review and Standard 4 reports it.
How to use: Use this pattern to tell development standards from reporting standards.
Exam Tip
Match the standard number to its discipline and to development or reporting. Record keeping questions point to the Record Keeping Rule, not a numbered standard.
Common Mistakes to Avoid
- -Confusing Standard 3 with mass appraisal standards
- -Thinking a numbered standard sets workfile retention periods
- -Forgetting that Standard 4, not Standard 3, covers reporting the review
Concept Deep Dive
Analysis
This question tests what Standard 3 covers. When a client asks for an evaluation of another appraiser's report, the service is an appraisal review. Standard 3 governs developing the review, while Standard 4 governs reporting it.
Background Knowledge
USPAP organizes its standards by discipline: real property appraisal, appraisal review, mass appraisal, and personal property appraisal each have a development standard followed by a reporting standard. Rules such as the Scope of Work Rule and Record Keeping Rule apply across disciplines.
Real-World Application
A lender asks a reviewer to evaluate whether a residential appraisal's adjustments are supported. The reviewer identifies the review problem and develops the opinion under Standard 3, then communicates it in a review report under Standard 4.
More USPAP Questions
Under USPAP, what are assignment results?
The certification required by Standards Rule 2-3 must be signed by:
Under 2024 USPAP, which statement correctly combines the requirements for an oral real property appraisal report and its workfile?
An appraiser accepts an assignment involving a property type the appraiser has valued once before, years ago. Competency requires:
A Certified General appraiser is asked to value a specialized industrial property for the first time. The appraiser knows a competency gap exists before agreeing to the assignment. What is required if the appraiser proceeds?
Under 2024 USPAP Standard 1, which listed assignment element must be identified in developing a real property appraisal?
An appraiser provided an appraisal of the same property for another client 18 months ago. No confidentiality obligation prevents disclosing the fact of that service. Before agreeing to a new assignment, the appraiser must:
According to USPAP, what is the primary purpose of the Ethics Rule?
An appraiser is asked to determine 'fair market value' for an assignment. According to USPAP, the appraiser should:
Which list gives the sections of the 2024 USPAP Ethics Rule?
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