A series of individually minor errors in an appraisal is addressed by Standards Rule 1-1 because:
Correct Answer
D) Together they can render the credibility of the results doubtful
Why this is correct: Standards Rule 1-1 requires that an appraisal be performed competently and without bias. A series of minor errors, when considered together, can undermine the credibility of the entire appraisal, which violates this standard. Why the other choices are wrong: "Errors of this kind are the reviewer's responsibility to catch" is wrong because the appraiser, not the reviewer, is primarily responsible for the report's accuracy. "Minor errors are always harmless if disclosed" is incorrect because cumulative minor errors can be material and misleading even if disclosed. "Only single major errors are ever actionable" is false; USPAP addresses the collective impact of errors. Exam tip: Remember that USPAP focuses on the credibility of the result. Multiple small issues can collectively create a big problem.
Why This Is the Correct Answer
Why this is correct: Standards Rule 1-1 requires that an appraisal be performed competently and without bias. A series of minor errors, when considered together, can undermine the credibility of the entire appraisal, which violates this standard. Why the other choices are wrong: "Errors of this kind are the reviewer's responsibility to catch" is wrong because the appraiser, not the reviewer, is primarily responsible for the report's accuracy. "Minor errors are always harmless if disclosed" is incorrect because cumulative minor errors can be material and misleading even if disclosed. "Only single major errors are ever actionable" is false; USPAP addresses the collective impact of errors. Exam tip: Remember that USPAP focuses on the credibility of the result. Multiple small issues can collectively create a big problem.
More USPAP Questions
Which type of appraisal report may contain the appraiser's analyses, opinions, and conclusions but is intended for use by the client only?
How long must an appraiser retain the workfile for an appraisal assignment under USPAP?
If an appraiser uses a hypothetical condition that the subject property is 10% larger than it actually is, this must be:
Under Standard 1, when developing a real property appraisal, an appraiser must:
An appraiser accepts an assignment to appraise a specialized industrial property but has never appraised this property type before. To comply with the Competency Rule, the appraiser:
According to the Scope of Work Rule, the scope of work must be appropriate to the:
According to Standard 1, when developing an opinion of market value, an appraiser must analyze:
A lender emails: 'We need at least $450,000 to make this loan work — can you take the assignment?' Accepting on that basis is:
An appraiser is developing an opinion of market value for a 20-unit apartment building. The appraiser finds three comparable sales with the following information: Sale 1: 18 units, sold for $1,800,000; Sale 2: 22 units, sold for $2,200,000; Sale 3: 24 units, sold for $2,280,000. What is the average price per unit for these comparables?
In developing a scope of work, an appraiser must consider all of the following factors EXCEPT:
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