USPAP USPAP Ethics Rule 1 — Questions and Answers
Question 1: Under the USPAP Ethics Rule, which of the following actions is considered a violation of the Conduct section?
- Performing an appraisal for a client who is a friend
- Accepting an assignment contingent on a predetermined value (Correct answer)
- Charging a flat fee regardless of property type
- Disclosing the scope of work to the client
Correct answer: Accepting an assignment contingent on a predetermined value
The Ethics Rule prohibits appraisers from accepting assignments with compensation contingent on a predetermined value or direction in value.
Question 2: The Confidentiality section of the USPAP Ethics Rule requires appraisers to protect:
- The appraiser's personal financial information
- Confidential information and assignment results from unauthorized parties (Correct answer)
- The identity of all comparable sales used
- The client's credit score
Correct answer: Confidential information and assignment results from unauthorized parties
The Confidentiality section obligates appraisers to protect confidential information and assignment results from unauthorized disclosure.
Question 3: Which USPAP Ethics Rule section addresses an appraiser's obligation to avoid false or misleading reports?
- Management section
- Record Keeping section
- Conduct section (Correct answer)
- Confidentiality section
Correct answer: Conduct section
The Conduct section of the Ethics Rule prohibits appraisers from communicating assignment results in a misleading or fraudulent manner.
Question 4: Under USPAP, an appraiser who pays a referral fee to a real estate agent for appraisal assignments is violating which section of the Ethics Rule?
- Confidentiality
- Record Keeping
- Management (Correct answer)
- Conduct
Correct answer: Management
The Management section of the Ethics Rule prohibits paying undisclosed fees, commissions, or kickbacks to obtain appraisal assignments.
Question 5: According to the Ethics Rule, an appraiser may share confidential assignment results WITHOUT violating USPAP when:
- Asked by a competing appraiser
- Required by due process of law (Correct answer)
- Requested by a prospective buyer
- The property has sold
Correct answer: Required by due process of law
USPAP allows disclosure of confidential information when required by due process of law or with client permission.
Question 6: The Record Keeping section of the USPAP Ethics Rule requires appraisers to retain their workfile for a minimum of:
- 1 year from the date of the report
- 3 years from the date of the report or 2 years after final disposition of any judicial proceeding (Correct answer)
- 5 years from the date of report completion
- Until the client requests destruction
Correct answer: 3 years from the date of the report or 2 years after final disposition of any judicial proceeding
USPAP requires workfiles to be retained for at least 5 years after preparation or at least 2 years after final disposition of any judicial proceeding, whichever is longer.
USPAP USPAP Ethics Rule 1
Under the USPAP Ethics Rule, which of the following actions is considered a violation of the Conduct section?