USPAP Scope of Work and Reporting Requirements 1 — Questions and Answers
Question 1: Under USPAP's Scope of Work Rule, who is responsible for determining the appropriate scope of work for an assignment?
- The client alone
- The intended user
- The appraiser (Correct answer)
- The state appraisal board
Correct answer: The appraiser
USPAP places responsibility for determining the appropriate scope of work on the appraiser, who must ensure it is sufficient to produce credible results.
Question 2: The Scope of Work Rule requires that the scope selected must produce results that are:
- The lowest cost to the client
- Credible given the intended use and intended users (Correct answer)
- Identical to every other appraisal of the same property
- Approved in advance by a review appraiser
Correct answer: Credible given the intended use and intended users
USPAP requires the scope of work to be sufficient to produce a credible appraisal given the intended use and the needs of the intended users.
Question 3: Under STANDARD 2, which of the following report types requires the MOST content and disclosure?
- Restricted appraisal report
- Appraisal report (Correct answer)
- Desktop appraisal report
- Summary appraisal report (pre-2014 edition)
Correct answer: Appraisal report
The appraisal report (formerly called summary appraisal report) requires more disclosure than the restricted appraisal report under current USPAP.
Question 4: Which of the following must be stated in any USPAP-compliant real property appraisal report?
- The appraiser's education transcripts
- The identity of the client and intended users (Correct answer)
- The appraiser's fee for the assignment
- The names of all competing appraisers considered
Correct answer: The identity of the client and intended users
STANDARD 2 requires the report to identify the client and the intended users to establish who may rely on the report.
Question 5: Under the Scope of Work Rule, departing from a recognized valuation method or procedure is acceptable if:
- The client agrees in writing
- The departure results in a lower fee
- The appraiser can demonstrate it still produces credible results (Correct answer)
- The departure is disclosed to the state licensing board
Correct answer: The appraiser can demonstrate it still produces credible results
An appraiser may depart from recognized methods or procedures as long as the resulting appraisal is still credible for its intended use.
Question 6: What does USPAP mean by the term 'intended use'?
- The physical use of the subject property
- The purpose for which the appraisal or appraisal review is used (Correct answer)
- The appraiser's intended market for their services
- The zoning designation of the property
Correct answer: The purpose for which the appraisal or appraisal review is used
Intended use refers to the purpose for which the client and intended users will use the appraiser's opinions and conclusions.
USPAP Scope of Work and Reporting Requirements 1
Under USPAP's Scope of Work Rule, who is responsible for determining the appropriate scope of work for an assignment?