UNIFORM STANDARDS OF PROFESSIONAL APPRAISAL PRACTICE FOR PERSONAL PROPERTY, INCLUDING FINE ARTS THE APPRAISAL STANDARDS BOARD OF THE APPRAISAL FOUNDATION WASHINGTON, D.C. USPAP was developed by the Appraisal Foundation to set minimum standards for professional appraisals. Adherence to these standards is required for members of certifying appraisal organizations. The standards guide the practices and expectations of the banking, insurance and legal professions. Standards 7 and 8 deal specifically with matters of personal property appraisal, including fine art. Standard 7 1. In developing a personal property appraisal, an appraiser must : (a) be aware of, understand, and correctly employ those recognized methods and techniques that are necessary to produce a credible appraisal. (b) not commit a substantial error of omission or commission that significantly affects an appraisal. (c) not render appraisal services in a careless or negligent manner, such as a series of errors that , considered individually, may not significantly affect the results of an appraisal, but which, when considered in the aggregate, would be misleading. 2. consider the purpose and intended use of the appraisal and observe the following specific appraisal guidelines: (a) adequately identify the property to be valued, including the method of identification (b) define the purpose and intended use of the appraisal, including all general and specific limiting conditions (c) identify the effective date of the appraisal (d) select and define the value to be considered consistent with the purpose of the appraisal (e) collect, verify, analyze and reconcile such data as are available, adequately identified and described to indicate a value conclusion (f) value the property by an appropriate appraisal method or technique (g) all pertinent information in items (a) through (f) above shall be used in the development of a personal property appraisal. 3. consider the purpose and intended use of the appraisal and observe the following specific appraisal guidelines: (a.) consider the effect of highest and best use by measuring and analyzing the current use and alternative uses to encompass what is profitable, possible, legal and physically possible, as relevant to the purpose and intended use of the appraisal. (b.) personal property has several measurable marketplaces, and the appraiser must identify, define, and analyze the appropriate market consistent with the purpose of the appraisal. (c.) Consider the market conditions at the time of the valuation including market acceptability of the property as well as supply, demand, scarcity and rarity. (d.) consider a sufficient quantity of data and any prior sales of the subject property within a sufficient period of occurrence to reach an appropriate estimate of value. (e.) consider the cost, income and sales comparison approaches and their degree of applicability in the valuation of personal property. The selection of valuation approaches to be used should be based on the availability of data and the purpose of the appraisal. (f.) consider the effects on value caused by attributes such as condition, style, quality, manufacturer, author, materials, origin, age, provenance, alterations and restorations (g.) identify any real estate, real property, trade fixtures or intangible items that are not personal property but are included in the appraisal (h.) all pertinent information in items (a) through (f) above shall be used in the development of a personal property appraisal. STANDARD 8 In reporting the results of a personal property appraisal, an appraiser must communicate each analysis, opinion, and conclusion in a manner that is not misleading. 1. Each written or oral personal property appraisal report must: (a) clearly and accurately set forth the appraisal in a manner that will not be misleading; (b) contain sufficient information to enable the person(s) who receive or rely on the report to understand it properly; (c) clearly and accurately disclose any extraordinary assumption or limiting condition that directly affects the appraisal, and indicate its impact on value. 2. Each written personal property appraisal report must comply with the following specific reporting guidelines by providing or including: (a) descriptive identification of the personal property being appraised; (b) identification of the ownership interest being appraised; (c) a statement of the purpose and intended use of the appraisal; (d) a definition of the value being considered that is consistent with the purpose of the appraisal; (e) the effective date of the appraisal and the date of the report; (f) a description of the extent of the process of collecting, confirming, and reporting data; (g) all assumptions and limiting conditions that affect the analyses, opinions, conclusions and valuations; (h) the information considered, the appraisal procedures followed, and the reasoning that supports the analyses, opinions, conclusions and valuations; (I) where appropriate, comparable sales data, auction results, offers from reputable firms or other statistics; if not included in the narrative of the report, they must be referenced in the report and maintained with the field notes. (j) where appropriate, an explanation and support of the analysis of the highest and best use; (k) where appropriate, an explanation and support of the analysis of the appropriate market; (1) an explanation and support of the exclusion of any of the usual valuation approaches; (m) any additional information that may be appropriate to show compliance with, or clearly identify and explain permitted departures from, the requirements of Standard 7. (n) a signed certification in accordance with Standards Rule 8-3. 3. Each written personal property appraisal must contain a certification that is similar in content to the following form: I certify that, to the best of my knowledge and belief: (a.) the statements of fact contained in this report are true and correct. (b.) the reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are my personal, unbiased professional analyses, opinions, and conclusions. (c.) I have no (or the specified) present or prospective interest in the property that is the subject of this report, and I have no (or the specified) personal interest or bias with respect to the parties involved. (d.) my compensation is not contingent upon the reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value estimate, the attainment of a stipulated result, or the occurrence of a subsequent event. (e.) my analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice. (f.) I have (or have not) made a personal inspection of the property that is the subject of this report. (If more than one person signs the report, this certification must clearly specify which individuals did and which individuals did not make a personal inspection of the appraised property.) (g.) no one provided significant professional assistance to the person signing this report. (If there are exceptions, the name of each individual providing significant professional assistance must be stated.) 4. To the extent that it is both possible and appropriate, each oral personal property appraisal report (including expert testimony) must address the substantive matters set forth in Standards Rule 8-2 and state conformity with Standards Rule 8-3. 5. An appraiser who signs a personal property appraisal report prepared by another, even under the label of “review appraiser", must accept full responsibility for the contents of the report. This requirement is directed to the employer or supervisor signing the report of an employee or subcontractor. The employer or supervisor signing the report is as responsible as the individual preparing the appraisal for the content and conclusions of the appraisal and the report. Using a conditional label next to the signature of the employer or supervisor or signing a form report on the line over the words “review appraiser" does not exempt that individual from adherence to these standards.

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