Disclosure of Assignment Results
July 20, 2014 |
Hopefully, appraisers have noted that the USPAP definition of Assignment Results has been edited in the 2014-2015 Edition of USPAP. While the overall definition has not really changed, the Comment following the definition has been revised for clarity:
Comment: Assignment results include an appraiser’s
- opinions or conclusions developed in an appraisal assignment, not limited to value;
- opinions or conclusions, developed in an appraisal review assignment, not limited to an opinion about the quality of another appraiser’s work; or
- opinions or conclusions developed when performing a valuation service other than an appraisal or appraisal review assignment. (Bold added for emphasis) (2014-2015 Edition USPAP)
What should stand out in the Comment is the clarification that opinions and conclusions developed in an appraisal assignment are not limited to value. This clarification was made in effort to put to rest the misconception that the value opinion in an appraisal is the only opinion or conclusion which is considered an assignment result, and therefore confidential. The Appraisal Standards Board (ASB) is making clear with the revision that ANY of the appraiser’s opinions or conclusions within the development of an appraisal are considered assignment results, and subject to confidentiality.
It seems that many appraisers are concerned about being contacted by parties other than the client requesting explanation or elaboration of how the appraiser arrived at his opinions or came to his conclusions. According to an excerpt from the January 2014 USPAP Q & A, the ASB states:
The appraised value of a property is clearly part of an appraiser’s assignment results, as are any of the appraiser’s opinions or conclusions that are specific to that assignment.
Additional examples of assignment results may include the appraiser’s opinion of highest and best use, condition of the property, and opinion of reasonable exposure time, just to name a few. (Bold added for emphasis)
In that same Q & A the ASB points out that the appraiser may confirm that he appraised a particular property. So, can appraisers confirm the zoning classification, annual taxes, dates used in the appraisal? It would seem so, since these are not opinions or conclusions. Can the appraiser discuss how he developed his opinion that an adjustment was necessary or the conclusion of an appropriate adjustment? Or even that a particular approach to value was, or was not, warranted? It does not appear so, as these are definitely opinions and conclusions.
Just as it has always been, client consent is required to discuss or disclose assignment results, except for those parties referenced in the Confidentiality section of the ETHIC RULE. Even if the third party indicates they are included as an intended user, it should be kept in mind that intended users are not a party to the appraiser-client relationship. Client consent is required in order to discuss with, or disclose, assignment results to an intended user.
About the Author
Tim Detty, CDEI
Certified General Real Property Appraiser
AQB Certified USPAP Instructor
Hondros College Appraisal Faculty
Senior Editor, Appraisal Programs – Hondros Learning