What is the USPAP minimum workfile retention period?
Correct Answer
A) Five years after preparation, or two years after a related court case, if later
Retain the workfile for at least five years after preparation or at least two years after the final disposition of a judicial proceeding in which the appraiser testified about the assignment, whichever expires later. These are USPAP minimums; applicable additional legal duties require separate consideration.
Why This Is the Correct Answer
Option A is correct because USPAP requires retaining the workfile for at least five years after preparation or at least two years after final disposition of any judicial proceeding in which the appraiser provided testimony related to the assignment, whichever period expires last. These are USPAP minimums.
Why the Other Options Are Wrong
Option B: Three years after delivery of the report, for each assignment it covers
Option B says three years after delivery of the report. USPAP's minimum is five years after preparation, so three years is too short and measured from the wrong event.
Option C: Until the mortgage on the subject property is fully repaid by the borrower
Option C says until the mortgage on the subject property is fully repaid. USPAP ties retention to preparation and any related judicial proceeding, not to the life of a loan.
Option D: One year after delivery, unless the client requests a longer period
Option D says one year after delivery unless the client requests longer. One year is far below the five-year minimum, and the period is not set by client request.
Five after prep, two after court
Keep the workfile five years after preparation or two years after final disposition of a case where you testified, whichever ends later.
How to use: Use this to recall both retention periods and which one controls.
Exam Tip
Remember that the later of the two periods applies, and that retention runs from preparation, not from report delivery.
Common Mistakes to Avoid
- -Measuring retention from report delivery instead of preparation
- -Forgetting the two-year judicial proceeding period
- -Choosing the earlier rather than the later of the two periods
Concept Deep Dive
Analysis
This question tests the USPAP workfile retention period. The rule sets two periods, five years after preparation or two years after final disposition of a judicial proceeding in which the appraiser testified about the assignment, and the longer one controls. Other legal duties may require longer retention.
Background Knowledge
The workfile contains the documentation supporting the appraiser's analyses, opinions and conclusions. The Record Keeping Rule sets retention minimums and requires the appraiser to have custody of or access to the workfile. State laws or client contracts may impose additional requirements.
Real-World Application
An appraiser testified in a divorce case about a home appraisal prepared four years ago, and the case was finally resolved last month. The appraiser keeps the workfile for at least two more years from that final disposition, since that ends later than the five-year period.
More USPAP Questions
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According to USPAP, what is the primary purpose of the Ethics Rule?
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