Topic 6b - USPAP

1) According to USPAP, any appraiser who signs any part of an appraisal report is required to: [5848]

A. Be state certified

B. Inspect the property

* C. Sign the certification

D. Sign the letter or transmittal

2) If an appraiser is asked to develop an opinion as to the quality of another appraiser's work and to agree or disagree with the value conclusion it is: [5730]

A. An appraisal assignment only

* B. Both a review and an appraisal

C. An appraisal

D. An appraisal review assignment only.-

3) An appraiser does an appraisal on July 1, 2000.  He testifies about the property on July 1, 2004.  The case is finalized in the property owner's favor on December 1, 2004.  The appraiser must keep the appraisal file until. [1070]

A. July 1, 2006

B. July 1, 2005

C. December 1, 2009

* D. December 1, 2006

4) An appraiser is appraising a parcel of vacant land. The inspection reveals indications that the site may be contaminated, although there is no clear evidence either way. If the site is to be appraised as if uncontaminated, the appraiser must use: [5778]

A. A limiting condition

B. An ordinary assumption

C. A hypothetical condition

* D. An extraordinary assumption

5) Your client asks you to pick up the check for the appraisal from the homeowner.  This practice: [1073]

* A. Neither violates USPAP nor changes the client

B. Does not violate USPAP but the homeowner becomes an intended user of the appraisal

C. Neither violates USPAP nor changes the client but you must provide the homeowner with a copy of the report

D. Is in violation of USPAP - payment must be received from the client to avoid bias

6) A client offers an assignment to an appraiser who has no experience with the property type. Access to other appraisal reports on similar properties is available, as well as publications about appraising this type of property. According to USPAP, which of the following conditions must be met before the appraiser may accept the assignment? [5762]

A. Under no conditions may the appraiser accept the assignment

B. None, because there is access to the other reports and publications

* C. The client is informed of the appraiser's lack of knowledge and experience

D. The appraiser associates with another appraiser who has experience in the property type

7) The interests, benefits, and rights inherent in the ownership of real estate is defined as: [1051]

A. Real estate

* B. Real property

C. Personal property

D. Chattel real

8) USPAP applies only to:   . [8556]

A. Real property appraisers who are members of organizations that are  sponsors of The Appraisal Foundation.

B. Appraisers who are members of organizations that are sponsors of The  Appraisal Foundation

C. State licensed or certified appraisers.

* D. Appraisers or appraisal services when they are required by law, regulation, agreement, or choice

9) Which of the following is a part of the definition of market value? [1042]

A. The sale price may have no buyer inducements or seller concessions

B. The sale price must be paid in U. S. Dollars or its equivalency in a stable foreign currency

C. The sale price must be paid in cash

* D. The sale price must be paid in cash or its equivalency

10) The Ethics Rule is divided into four sections.  Which of the following activities is not one of the four sections? [3104]

A. Management

B. Confidentiality

C. Record-keeping

* D. Departure

11) Which of the following is an example of a limiting condition. [1032]

A. The appraiser has no (or the specified) present of prospective interest in the property that is the subject of this report

* B. The appraiser is not required to give testimony in court unless arrangements have been previously made

C. I have (or have not) made a personal inspection of this property

D. My compensation for preparation of this report is $300

12) Which of the following best describes appraisal consulting? [8603]

A. The act of rendering an opinion of value on assets.

B. An appraisal that involves an estimate of the market value of property  within a range.

C. An act or process of providing information, analysis, recommendations, or  conclusions, other than estimating value.

* D. The act or process of developing an analysis, recommendation, or opinion  to solve a problem, where an opinion of value is a component of the analysis leading to the assignment results.

13) If an appraiser decides that a specific requirement is not applicable to the development of credible results, the appraiser must: [8602]

* A. Recognize that the specific requirement is irrelevant, and therefore no departure is needed.

B. Develop all three approaches in the appraisal report

C. Invoke the Departure Rule if the specific requirement is excluded from the development process.

D. Notify the client before proceeding with the assignment.

14) The Preamble and Rules Section does not include the following: [1048]

A. Jurisdictional exception rule

B. Competency rule

C. Supplemental standards rule

* D. Appraisal development rule

15) Identification of the intended use of an appraiser's opinions and  conclusions is: [5737]

A. Not necessary in most appraisal assignments

* B. Necessary for determining the appropriate scope of work

C. Necessary only when developing an opinion of market value

D. Not required unless the client wishes the intended use to be disclosed

16) Which of the following best describes the Statements on Appraisal Standards? [8507]

A. They are all or part of a Standards Rule from which departure is permitted.

* B. They are for the clarification, interpretation, explanation, or elaboration of USPAP and have the full weight of a Standards Rule.

C. They offer non-binding advice from the ASB for the resolution of appraisal issues and problems.

D. The are issued by users of appraisal services and add to the requirements in USPAP.

17) Client authorization is not required for disclosure of confidential information when the information is: [5826]

A. Requested by an attorney

* B. Modified through redaction or aggregation

C. Disclosed after the completion of the intended use

D. Requested by a property owner who is not the client

18) Identification of the intended use of an appraiser's opinions and conclusions is: [5789]

A. Not necessary in most appraisal assignments

* B. Necessary for determining the appropriate scope of work

C. Necessary only when developing an opinion of market value

D. Not required unless the client wishes the intended use to be disclosed

19) The purpose of the JURISDICTIONAL EXCEPTION RULE is to: [5810]

A. Place additional requirements on the appraiser

B. Allow for cooperation with other professional appraisers

C. Permit acceptance assignments in geographic areas not known to the appraiser

* D. Preserve the balance of USPAP when a portion is contrary to law or public policy

20) An appraiser must maintain a copy of the entire appraisal and a workfile for each appraisal performed. [3046]

A. An electronic copy of the entire written appraisal is acceptable

B. The workfile may be an informal handwritten record

* C. Both of the above are correct

D. Neither of the above is correct

21) How long must a workfile be retained? [5777]

A. Two years after preparation or two years after final disposition of any judicial proceeding in which testimony was given, whichever period expires last

B. Five years after preparation or two years after final disposition of any judicial proceeding in which testimony was given, whichever period expires first

* C. Five years after preparation or two years after final disposition of any judicial proceeding in which the appraiser provided testimony related to the assignment

D. Three years for commercial work and one year for residential reports or two years after final disposition of any judicial proceeding in which testimony was given, whichever period expires last

22) Compared to the opinion expressed in a Summary Appraisal Report, the opinion conveyed in a Restricted Use Appraisal Report should be considered: [5744]

* A. Equally credible

B. Less reliable

C. Less credible

D. More reliable

23) Which of the following reports require a signed certification? [5846]

A. Only business appraisal reports

* B. All written reports covered in USPAP

C. Only real property and business appraisal reports

D. Only real property appraisal and appraisal review reports

24) Standards Rule 1-2 contains many binding requirements.  Which of the following is a binding requirement of Standard Rule 1-2? [2072]

A. Define market value

* B. Identify the effective date of the appraiser's opinions and conclusions

C. Include a statement of highest and best use

D. Included a signed certification

25) If compliance with a specific requirement is necessary to develop credible results,  an appraiser must: [8570]

A. Label the development process as a Limited Appraisal

B. Disclose departure from that specific requirement

* C. Not depart from the specific requirement

D. Secure the client's permission before departing from the requirement

26) Payment of a fee to procure appraisal assignments is: [5824]

A. Considered unethical in all cases

B. Prohibited by Standards Rules

C. Acceptable if acknowledged in the engagement letter

* D. Allowed if disclosed in the certification and in any transmittal letter

27) Which of the following best describes Advisory Opinions? [8559]

A. Are an integral part of the Uniform Standards and are extensions of the Rules, Definitions, and Standards Rules.

B. Are for the purpose of clarification, interpretation, explanation, or  elaboration of USPAP and have the full weight of a Standards Rule.

C. Are assignment performance requirements that add to the requirements in USPAP.

* D. Do not establish new standards or interpret existing standards but are issued to illustrate the applicability of appraisal standards in specific situations.

28) When providing valuation services outside of USPAP, appraisers must: [5718]

* A. Not misrepresent their role

B. Disclose that they are appraisers

C. Not disclose that they are appraisers

D. Comply COMPETENCY the COMPETENCY RULE

29) An appraiser may prepare a Restricted Use Appraisal Report only when the client is [8575]

* A. The only intended user

B. Is the property owner

C. Not the property owner

D. A financial institution

30) That which is contrary to what exists, but is supposed for the purpose of analysis is: [5805]

A. A departure

* B. A hypothetical condition

C. A special limiting condition

D. An extraordinary assumption

31) What is a complete appraisal? [3044]

A. The act or process of developing an appraisal after invoking the departure rule

B. The act or process of developing an appraisal after invoking the competency rule

* C. Neither of the above

D. Both of the above

32) An appraiser must have the knowledge and experience to complete the appraisal assignment.  What part of USPAP dictates this? [1094]

* A. The Competency Rule

B. Standard 1

C. Standard 2

D. The Ethics Rule

33) A tangible object that is NOT real estate, is considered [8610]

A. A business entity

B. Real property

* C. Personal property

D. Intellectual property

34) An appraiser completed an appraisal report on March 10, 1996; litigation related to the appraisal was completed on March 10, 2000. Under USPAP, the appraiser must retain the workfile until: [8565]

A. March 10, 2005

* B. March 10, 2002

C. March 10, 2001

D. March 10, 2004

35) The appraiser needs to know the intended use and intended users of the appraisal: [8025]

* A. To determine the scope of the work

B. To determine the purpose of the appraisal

C. To decide what fee to charge

D. All of the above

36) Under STANDARD 3, which of the following best describes an appraisal  review? [5729]

A. An opinion of a business enterprise

B. A process involving the supervision of another appraiser

C. A process of both developing and reporting the supervision of the appraisal

* D. The act or process of developing and communicating an opinion about the quality of another appraiser's work

37) An intended user is: [5806]

A. Anyone who uses the appraisal report

B. Only the party who pays for the appraisal report

C. Anyone who receives the appraisal report from the client

* D. A party who is identified by the appraiser based upon communication with the client at the time of the assignment

38) Which of the following are the distinguishing terms related to the reporting options? [5844]

A. Narrative, form, and letter

B. Written, verbal, and electronic

* C. Describe, summarize, and state

D. Complete, limited, and restricted

39) A hypothetical condition assumes: [1020]

A. An assumption, directly related to a specific assignment, which, if found to be false, could alter the appraiser's opinions or conclusions

* B. That which is contrary to what exists, but is supposed for the purpose of analysis

C. Both of the above

D. Neither of the above

40) When appraisers invoke the Departure Rule, they may depart [8569]

A. From the Ethics and Competency Rules

B. From USPAP in its entirety

* C. Only from specific requirements

D. Without the client's permission

41) An extraordinary assumption may be used in an assignment only if: [5837]

A. Approved by the client

B. Identified as a departure

C. Mandated by law or public policy

* D. It is required to develop credible results

42) Under Standard 3, which of the following best describes an appraisal review? [8586]

A. a process of both developing and reporting the supervision of the appraisal.

B. an opinion of a business enterprise.

C. a process involving the supervision of another appraiser.

* D. the act or process of developing and communicating an opinion about the quality of another appraiser's work.

43) If an appraiser is asked to develop an opinion as to the quality of another appraiser's work and to agree or disagree with the value conclusion it is: [5780]

A. An appraisal assignment only

* B. Both a review and an appraisal

C. An appraisal consulting assignment

D. An appraisal review assignment only

44) In appraisal practice, acting as an advocate for any party or issue [8571]

A. Permitted when properly disclosed

* B. Not permitted

C. Permitted when done professionally by a competent appraiser

D. Permitted when a contingent fee is not involved

45) USPAP applies to: [8504]

A. Appraisers who are members of organizations that are sponsors of the Appraisal Foundation

B. State licensed or certified appraisers

* C. Appraisers or appraisal services when they are required by law, regulation, or choice

D. Real Property Appraisers who are members of organizations that are sponsors of The Appraisal Foundation

46) Appraisal records must be retained for at least: [1068]

A. 7 years

B. 2 years

C. 4 years

* D. 5 years

47) What special requirements, if any, are imposed upon an appraiser when appraising the market value of a property subject to assumable favorable financing? [5738]

A. Appraise the property under typical financing only

* B. Identify the special financing terms and develop an opinion of their effect on value

C. Disclose the favorable financing to the proposed lender prior to accepting the assignment

D. Include no special requirements as long as the financing is actually available to the typical buyer

48) When something is uncertain yet necessary to the development of the value opinion, the appraiser must identify the uncertainty as: [8576]

A. A binding requirement

B. A specific requirement

* C. An extraordinary assumption

D. A hypothetical condition

49) A study that reflects the relationship between acquisition price and anticipated future benefits of a real estate investment is: [3021]

A. A cash flow analysis

* B. An investment analysis

C. A market analysis

D. A feasibility analysis

50) An appraiser is asked to do an appraisal that includes a discounted cash flow analysis, a technique which is unfamiliar to him.  The appraiser  must: [8510]

A. Disclose the lack of knowledge and/or experience to the client after accepting the assignment

* B. Take all steps necessary or appropriate to complete the assignment competently

C. Turn down the assignment

D. Associate with an appraiser reasonably believed to have the necessary knowledge or experience