An appraiser who transfers workfile custody to another party remains:
Correct Answer
A) Responsible for meeting the retention requirement
An appraiser must have custody of the workfile or make appropriate retention, access and retrieval arrangements with the party holding it. Transferring storage does not remove those obligations. Retain the required material for at least five years after preparation or two years after final disposition of related proceedings in which testimony was given, whichever expires later. Observe required production duties and confidentiality; a client request alone does not establish an unrestricted right to the entire workfile.
Why This Is the Correct Answer
Option A is correct because USPAP states that an appraiser must have custody of the workfile or make appropriate retention, access and retrieval arrangements with the party having custody. Transferring storage does not remove the obligation to retain the workfile for at least five years after preparation or at least two years after final disposition of a judicial proceeding in which the appraiser testified, whichever expires last.
Why the Other Options Are Wrong
Option B: Released from all record keeping duties
Option B, released from all record keeping duties, is wrong because a custody transfer does not release the appraiser; the appraiser must still ensure retention, access and retrieval.
Option C: Liable for two years, then released from retention
Option C, liable for two years and then released, is wrong because the retention period is at least five years after preparation, or two years after final disposition of a related proceeding with testimony if that is later; it is not a flat two-year period that ends the duty.
Option D: Released once the client consents to the transfer
Option D, released once the client consents to the transfer, is wrong because client consent does not change USPAP's record keeping obligations; the appraiser remains responsible for the arrangements.
Hand off the box, not duty
You can hand someone the file box, but the duty to keep it available stays in your hands.
How to use: Use this when a scenario has an employer, client or storage vendor holding the workfile.
Exam Tip
Options saying the appraiser is released by a transfer, by client consent or after a short period conflict with the Record Keeping Rule.
Common Mistakes to Avoid
- -Believing an employer's custody ends the appraiser's retention duty
- -Thinking client consent releases USPAP record keeping obligations
- -Misstating the retention period as two years from preparation
Concept Deep Dive
Analysis
This question tests whether handing the workfile to someone else ends the appraiser's record keeping duty. USPAP requires the appraiser either to keep custody or to make appropriate retention, access and retrieval arrangements with the party holding it. The responsibility for meeting the retention period stays with the appraiser.
Background Knowledge
The Record Keeping Rule requires a workfile for each appraisal or review assignment and sets retention periods. Appraisers who leave a firm or use outside storage must keep arrangements that allow them to access and retrieve the workfile when needed, such as for a regulator or a court.
Real-World Application
An appraiser leaves a firm whose server holds her workfiles from the past three years. Before leaving, she arranges in writing with the firm to retain the files and give her access and retrieval when needed, because she remains responsible for retention.
More USPAP Questions
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Under 2024 USPAP Standard 1, which listed assignment element must be identified in developing a real property appraisal?
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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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