What must be disclosed when an appraiser relies on a prior report they prepared on the same property?
Correct Answer
A) That prior service, since it precedes acceptance
Why this is correct: USPAP's Ethics Rule requires disclosure of any previous service on the subject property within the prior three years to the client before acceptance. This allows the client to assess potential issues like appraiser bias or expectation of consistency. Why the other choices are wrong: Nothing, as it was the appraiser's own earlier work is incorrect; disclosure is required. Only the fee charged is not the required disclosure. The identity of the prior client is not the primary disclosure; the fact of prior service is. Exam tip: Remember the 3-year look-back for disclosing prior service on the subject property.
Why This Is the Correct Answer
Why this is correct: USPAP's Ethics Rule requires disclosure of any previous service on the subject property within the prior three years to the client before acceptance. This allows the client to assess potential issues like appraiser bias or expectation of consistency. Why the other choices are wrong: Nothing, as it was the appraiser's own earlier work is incorrect; disclosure is required. Only the fee charged is not the required disclosure. The identity of the prior client is not the primary disclosure; the fact of prior service is. Exam tip: Remember the 3-year look-back for disclosing prior service on the subject property.
More USPAP Questions
Reconciliation of the approaches to value is best described as which activity?
Why should the reconciliation address the quantity of evidence as well as its quality?
How long must a report be retained compared with the workfile?
What distinguishes an appraisal review from an appraisal?
An appraiser reconciles to a value at the top of the indicated range because the client needs that figure. What has occurred?
What does it mean that a value opinion must be reasonable rather than merely arithmetically derived?
What should the reconciliation section explain to the reader?
How do the content obligations of the two report options differ with respect to the information analyzed?
The three approaches indicate $480,000, $495,000 and $610,000. What should the appraiser do first?
Three approaches indicate $1.02 million, $1.05 million and $1.04 million. How should this be reported?
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