A waste of paper?
I recall overhearing a discussion between two appraisal industry ‘old timers’ many years ago (at the time they were probably younger than I am now) in which they espoused utter contempt for the ’10-page, single-item appraisal.’ They were both of the opinion such documents were filled with pages of ‘useless verbiage’ intended to make the appraiser seem knowledgeable and important, while providing nothing that mattered to the client. At the time, I was a relative newcomer to the world of appraising and had never seen one of those long-winded reports, so I had no opinions to offer. I’ve now seen many of them and in fact, I may even produce them on a regular basis, although my typical one-item appraisal is only seven or eight pages in length, rather than the 10 pages the veteran appraisers were ranting about. What, you may ask, could possibly fill that many pages?
I belong to several appraisal organizations and each has what could be described as minimum report writing standards to which I must adhere; however, as a member of one of those organizations (i.e. American Society of Appraisers [ASA]), I’ve agreed to mandatory compliance with the Uniform Standards of Professional Appraisal Practice (USPAP). Standard 8 of USPAP lays out very specific minimum requirements for reporting the results of an appraisal assignment. There is no specific style requirement in Standard 8, only the expectation results will be unambiguously reported and contain the specified information.
The list of required elements is fairly extensive and includes things, such as:
- “¨a certification the facts stated are true;
- “¨the proclamation of impartiality by the appraiser;
- “¨the report’s intended use;
- the definition of value and its source;
- the approach to value chosen and the markets examined;
- limiting conditions;
- effective date of the valuation; and
- disclosure of any other information necessary to clearly understand the value opinion.
Although I won’t go into the details of Standard 8 in this column, I strongly encourage readers to visit the Appraisal Foundation website and peruse the contents of USPAP if for no other reason than to gain some appreciation for what our fellow professional appraisers feel is essential to any report. The sections of USPAP that apply to jewellery appraisals include Definitions, Ethics Rule, Competency Rule, Scope of Work Rule, Record Keeping Rule, Jurisdictional Exceptions Rule, Standard 7, and Standard 8. As one might imagine, it’s not difficult to fill a few pages just staying in compliance with USPAP. Yet, it begs the question of whether any of that information is important to the client. In fact, on some level, all the information is important to the correct understanding of the value opinion. But what about disclaimers? Can they actually ‘protect’ the appraiser?