ARA Report Writing & Ethical Standards 2 — Questions and Answers
Question 1: Under USPAP's Confidentiality section, an appraiser may disclose confidential information without client consent when:
- A peer reviewer requests it
- Required by law or a court order (Correct answer)
- Another appraiser is hired to review the work
- The property owner requests a copy
Correct answer: Required by law or a court order
USPAP allows confidential information disclosure only when required by law, court order, or with the client's permission.
Question 2: A restricted appraisal report differs from an appraisal report primarily in that it:
- Omits the reconciliation section entirely
- Contains less content and is intended only for the client (Correct answer)
- Is only used for federally related transactions
- Does not require a certification statement
Correct answer: Contains less content and is intended only for the client
A restricted appraisal report contains fewer disclosures and is intended solely for client use, not third parties.
Question 3: Which element is REQUIRED to appear in every appraisal report under USPAP Standards Rule 2-2?
- Three comparable sales photographs
- A certification signed by the appraiser (Correct answer)
- A floor plan of the subject property
- A copy of the engagement letter
Correct answer: A certification signed by the appraiser
Standards Rule 2-2 mandates that every appraisal report include a signed certification by the appraiser.
Question 4: An appraiser's certification must include a statement that:
- The client approved the value conclusion
- The appraiser has no prior interest in the property (Correct answer)
- The report was reviewed by a supervisory appraiser
- The assignment was completed within 30 days
Correct answer: The appraiser has no prior interest in the property
The certification must state that the appraiser has no present or prospective interest in the property that would bias the analysis.
Question 5: When an ARA appraiser signs a report as a supervisory appraiser, they are certifying that:
- They personally inspected every comparable sale
- They accept full responsibility for the report's content (Correct answer)
- The trainee holds a temporary credential
- The client approved the supervisory arrangement
Correct answer: They accept full responsibility for the report's content
A supervisory appraiser's signature indicates they accept full responsibility for the appraisal report.
Question 6: Under ETHICS RULE, an appraiser must NOT accept an assignment with a predetermined:
- Effective date
- Opinion of value (Correct answer)
- Property type restriction
- Reporting format
Correct answer: Opinion of value
Accepting an assignment contingent on reporting a predetermined value violates the USPAP Ethics Rule.
Question 7: The COMPETENCY RULE requires an appraiser who lacks knowledge for an assignment to:
- Decline the assignment immediately without exception
- Disclose the lack of knowledge and take steps to become competent before completing the report (Correct answer)
- Refer the client to another appraiser without explanation
- Complete the report and note limitations in the addenda
Correct answer: Disclose the lack of knowledge and take steps to become competent before completing the report
The Competency Rule allows an appraiser to accept an assignment if they disclose the deficiency and acquire the needed competency before the assignment is complete.
ARA Report Writing & Ethical Standards 2
Under USPAP's Confidentiality section, an appraiser may disclose confidential information without client consent when: