|
What is USPAP?
USPAP, which you might hear pronounced like "YOOS-pap," is the Uniform Standards of Professional Appraisal Practice. USPAP is published and maintained by the Appraisal Standards Board (ASB) of the Appraisal Foundation, a non-governmental entity charged by Congress with promulgating appraisal standards.
USPAP is revised periodically, usually annually, and almost never radically . . until now. Click here to download the 2006 Uniform Standard of Appraisal Practice.
USPAP now identifies standards that apply in all appraisal assignments. Although the appraiser’s role in the development process has not changed, there are many other significant changes.
What are the biggest changes that have occurred for 2006?
The new Scope of Work Rule (SOW) replaces the Departure Rule as one of the five rules (Ethics, Competency, Scope of Work, Jurisdictional Exceptions and Supplemental Standards).
The new SOW Rule continues to be based on what is required to produce credible assignment results. The term “credible” is also defined so appraisers understand exactly what they are attempting to achieve. Also, the term “appraiser’s peers” has been modified for clarity.
The SOW Rule was added to emphasize the requirements of property identification. Also included are how to determine an appropriate SOW and how to disclose it.
New Advisory Opinions were also added.
- AO 28 was added to give guidance on how to meet the requirements of the new SOW and how to disclose this decision. The ASB includes specific illustrations to clarify the application of these procedures.
- AO 29 was added to discuss what an acceptable SOW looks like and how to apply SOW in specific assignments.
Some Items were removed:
- The most important item removed is the Departure Rule. The result is that the Standards Rules no longer contain the terms complete and limited appraisals.
- SMT 7 (Permitted Departures from Specific Rules) and AO 15, which deals with the same subject, were both retired.
- AO 8, which deals with fair value appraisals, was also retired as the Financial Accounting Standards Board changed its definition of fair value.
According to the Appraisal Standards Board (ASB), these items were taken out to: resolve misunderstandings related to departure; enhance public trust in appraisal practice and to improve the clarity of USPAP.
Here are some additional USPAP 2006 resources:
Every appraiser is charged with knowing and following USPAP, usually by operation of state law, and must complete Continuing Education periodically to relearn the basics and become familiar with new Advisory Opinions and annual changes to USPAP. USPAP may be considered the Bible of appraisal practice.
Click here to download the 2006 Uniform Standard of Appraisal Practice.
|