A report states that the appraiser assumes the survey provided is accurate. What kind of statement is this?
Correct Answer
D) An assumption limiting the scope of the work
Why this is correct: An assumption that the survey is accurate is a statement that the appraiser accepted this information without independent verification, thereby limiting the scope of the work performed. This is a standard, ordinary assumption that defines the boundaries of the appraisal. Why the other choices are wrong: It is not a hypothetical condition applied to the site, as that would involve assuming a fact contrary to what is known. It is not a jurisdictional exception to the Scope Rule, which pertains to departures from USPAP. It is not a certification of the surveyor's competence, as the appraiser is not vouching for the surveyor. Exam tip: Scope-limiting assumptions are ordinary and expected, but they must be genuine. If evidence contradicts the assumption, the appraiser cannot ignore it.
Why This Is the Correct Answer
Relying on a survey supplied by another party is an assumption defining what the appraiser did not independently verify, thereby limiting the scope of work.
Why the Other Options Are Wrong
Option A: A hypothetical condition applied to the site
A hypothetical condition is contrary to a known fact. Nothing suggests the survey is inaccurate.
Option B: A jurisdictional exception to the Scope Rule
A jurisdictional exception arises where law or regulation precludes compliance with part of USPAP, which is not the case here.
Option C: A certification of the surveyor's competence
The appraiser is not certifying the surveyor's competence and is in no position to assess it.
What You Did Not Verify
What You Did Not Verify, stated plainly. That is an assumption, and it draws the boundary of your work.
How to use: Ask whether you have reason to doubt it. Routine reliance is an assumption; specific doubt makes it extraordinary.
Exam Tip
The same statement can be ordinary or extraordinary depending on the circumstances. What changes it is whether being wrong would alter the conclusions.
Common Mistakes to Avoid
- -Classifying routine reliance as a hypothetical condition
- -Treating any assumption as extraordinary
- -Reading the statement as a certification of another professional
Concept Deep Dive
Analysis
Relying on a survey provided by another party is an ordinary assumption limiting the scope of the appraiser's work: the appraiser did not verify the boundaries and is stating so, which tells the reader where the analysis stopped and what was taken as given. It is not a hypothetical condition, because nothing contrary to a known fact is being assumed — the appraiser has no reason to believe the survey is wrong. It is not a jurisdictional exception, which arises only where law or regulation precludes compliance with part of USPAP. And it is not a certification of the surveyor, whose competence the appraiser is in no position to assess and does not purport to. The useful discipline is to distinguish this from an extraordinary assumption. If the appraiser had specific reason to doubt the survey's accuracy, and being wrong would change the value, the assumption would become extraordinary and require prominent disclosure rather than routine treatment.
Background Knowledge
Assumptions define what an appraiser accepted without independent verification, limiting the scope of work. Where an assumption is uncertain and could alter the conclusions if false, it becomes an extraordinary assumption requiring prominent disclosure.
Real-World Application
An appraiser states reliance on a client-supplied survey among the report's assumptions, having no reason to question its accuracy.
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