Which item must be identified in every written real property appraisal report?
Correct Answer
B) The client and any other intended users
Why this is correct: USPAP requires every written appraisal report to identify the client and any other intended users. This defines for whom the report is prepared and the level of information it must contain. Why the other choices are wrong: The fee agreement is a business matter, not a required report element. The lender's underwriting requirements are not a universal identification requirement. Comparable sales are identified by property address, not by owner name. Exam tip: Client and intended user identification is a core USPAP reporting requirement in every assignment.
Why This Is the Correct Answer
Identification of the client and any other intended users is required in every written appraisal report and determines confidentiality, level of explanation, report option and the bounds of reliance.
Why the Other Options Are Wrong
Option A: The fee agreed for the appraisal assignment
The fee belongs in the engagement agreement. Disclosing it in the report could suggest a link between compensation and conclusion.
Option C: The lender's underwriting requirements
Lender underwriting requirements are the client's internal criteria rather than required report content.
Option D: The names of every comparable's owner
The names of comparable property owners serve no analytical purpose and raise privacy concerns.
Who Hired You and Who Will Read It
Who Hired You and Who Will Read It. Everything else in the report follows from those two answers.
How to use: Identify both at intake, not at the end. Scope of work depends on them.
Exam Tip
The identifications bound reliance. A party not identified as an intended user is not entitled to rely on the report.
Common Mistakes to Avoid
- -Naming the client without identifying other intended users
- -Including the fee in the report
- -Identifying users at the end rather than at intake
Concept Deep Dive
Analysis
Identifying the client and any other intended users is a foundational reporting requirement, and it appears in every written real property appraisal report regardless of the report option chosen. The reason is that those identifications determine almost everything else about the assignment: the confidentiality obligation runs to the client, the level of explanation must suit the intended users, the report option depends on whether the client is the sole intended user, and the appraiser's liability for reliance is bounded by who was identified. Identification also happens at the outset rather than at the end, since scope of work is set by intended use and intended users. The distractors name items that do not belong. The fee is a matter for the engagement agreement and disclosing it could suggest a link between compensation and conclusion. Lender underwriting requirements are the client's business, not the report's content. And comparable owners' names serve no analytical purpose and raise privacy concerns.
Background Knowledge
USPAP requires every written real property appraisal report to state the identity of the client and any intended users. These identifications determine confidentiality, the appropriate report option and the level of explanation required.
Real-World Application
An appraiser names the lender as client and the lender and borrower as intended users on the first page, and writes to a level the borrower can follow.
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?
People Also Study
Real Estate Market
13.6% of exam
Property Description
11.8% of exam
Land or Site Valuation
4.5% of exam
Sales Comparison Approach
16.4% of exam
Cost Approach
13.6% of exam