Value as of a date in the past for estate settlement is:
Correct Answer
D) A retrospective appraisal with a defined effective date
Why this is correct: A retrospective appraisal estimates value as of a past effective date. It is permitted and common for purposes like estate settlement, divorce, or tax appeals. The analysis must use data known or knowable as of that past date. Why the other choices are wrong: 'An extraordinary assumption about the past' is wrong; an extraordinary assumption deals with uncertain future conditions, not a past valuation date. 'Prohibited unless the subject property still exists today' is wrong; retrospective appraisals are allowed even if the property has changed, but the analysis is as of the past date. 'Permitted only within one year of the date' is wrong; there is no USPAP time limit for how far back a retrospective date can be. Exam tip: Retrospective = value as of a date in the past. Prospective = value as of a date in the future.
Why This Is the Correct Answer
Why this is correct: A retrospective appraisal estimates value as of a past effective date. It is permitted and common for purposes like estate settlement, divorce, or tax appeals. The analysis must use data known or knowable as of that past date. Why the other choices are wrong: 'An extraordinary assumption about the past' is wrong; an extraordinary assumption deals with uncertain future conditions, not a past valuation date. 'Prohibited unless the subject property still exists today' is wrong; retrospective appraisals are allowed even if the property has changed, but the analysis is as of the past date. 'Permitted only within one year of the date' is wrong; there is no USPAP time limit for how far back a retrospective date can be. Exam tip: Retrospective = value as of a date in the past. Prospective = value as of a date in the future.
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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An appraiser is developing an appraisal for a bank loan and discovers that the property has environmental contamination that significantly affects value, but the lender specifically requests that this issue not be mentioned in the report. According to USPAP, the appraiser should: