An appraiser reviewing another appraiser's report under Standard 3 develops her own opinion that the original value is wrong. What is she doing?
Correct Answer
B) Permitted review work that includes the reviewer's own opinion of value
Why this is correct: Under Standard 3, an appraisal review may include the reviewer's own opinion of value. When it does, the reviewer must comply with the development standards (Standard 1) for that opinion. Disagreement is part of the analytical process. Why the other choices are wrong: 'Clearly exceeding a reviewer's lawful authority under the review standards' is incorrect; forming an independent opinion is permitted. 'An automatic ethics referral of the original appraiser' is wrong; a differing opinion is not an ethics violation. 'Nothing regulated, since reviews are informal' is false; Standard 3 governs appraisal reviews. Exam tip: A reviewer can develop their own value opinion, but then they must follow Standard 1 for that development.
Why This Is the Correct Answer
The review standards contemplate a reviewer developing their own opinion of value, subject to complying with the applicable development standards and disclosing the opinion and the reasons for disagreement.
Why the Other Options Are Wrong
Option A: Clearly exceeding a reviewer's lawful authority under the review standards
Developing an own opinion of value is within a reviewer's authority under the review standards rather than beyond it.
Option C: An automatic ethics referral of the original appraiser
Disagreement with a conclusion is not misconduct and generates no automatic referral.
Option D: Nothing regulated, since reviews are informal
Appraisal review is expressly governed by USPAP and is not informal or unregulated.
Review Can Include a Value
Review Can Include a Value — but then you owe the development standards for it too.
How to use: Separate the two products: the opinion about the work, and any opinion of value you develop yourself.
Exam Tip
Disagreement is not an ethics matter. Referral arises from misconduct, not from a different conclusion.
Common Mistakes to Avoid
- -Believing a reviewer may not develop a value opinion
- -Failing to comply with development standards for the reviewer's own opinion
- -Treating disagreement as grounds for an ethics referral
Concept Deep Dive
Analysis
Appraisal review under Standard 3 covers the act of developing an opinion about the quality of another appraiser's work, and the reviewer may go further: the review standards expressly contemplate a reviewer developing their own opinion of value as part of the review assignment. Doing so triggers additional requirements — the reviewer must comply with the applicable development standards for that value opinion, must disclose it clearly, and must state the reasons for disagreeing with the work under review. What the reviewer must not do is confuse the two roles or present a personal opinion as though it were a critique of the original appraiser's process. Nor does disagreement itself generate any ethics consequence: a difference of opinion is not misconduct, and treating a review as an automatic referral would deter the candid work reviews exist to produce. The reviewer's own competency and impartiality obligations apply throughout, and the scope of the review assignment must be identified and disclosed like any other.
Background Knowledge
Appraisal review under USPAP covers developing an opinion about the quality of another appraiser's work. A reviewer may develop an own opinion of value, subject to the applicable development standards and disclosure requirements.
Real-World Application
A reviewer develops her own value opinion, discloses it as part of the review, complies with the development standards, and states her reasons for disagreeing.
More USPAP Questions
Which statement best defines a hypothetical condition under USPAP?
According to the Competency Rule, if an appraiser lacks the knowledge and experience to complete an assignment competently, which action is NOT acceptable?
An appraiser runs only the sales comparison approach on a standard tract home and omits the cost and income approaches. Under Standard 1 this is:
A value opinion for a subdivision as if fully built out two years from now is what kind of assignment, and what does it require?
A hypothetical condition differs from an extraordinary assumption in that a hypothetical condition:
An appraiser must disclose in the certification whether they have:
A client-imposed requirement — 'use only comps from our approved list' — is best described as:
Under Standard 1, when developing a real property appraisal, an appraiser must:
The certification required by Standards Rule 2-3 must be signed by:
According to Standard 1, when developing an opinion of market value, an appraiser must analyze:
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