Isabella Carter
The Appraisal Institute's Standards of Professional Practice (SPP) are a set of guidelines that establish requirements for appraisals and appraisal reviews. They are composed of the Standards of Valuation Practice (SVP) and the Certification Standard, as well as applicable national or international standards such as the Uniform Standards of Professional Appraisal Practice (USPAP) and the International Valuation Standards (IVS). The SPP also includes an ethics rule, a record-keeping rule, and a competency rule, which set forth requirements for integrity, workfile management, and pre-assignment conditions, respectively. In addition to the SPP, the Appraisal Institute has adopted Guide Notes, which provide guidance on how to apply the standards in specific situations, and a Code of Professional Ethics, which establishes ethical requirements for members.
| Characteristics | Values |
|---|---|
| Standards | 1. Requirements for the development and reporting of a real property appraisal |
| 2. Requirements for the development and reporting of an appraisal review | |
| 3. Requirements for the development and reporting of mass appraisals | |
| 4. Requirements for the development and reporting of personal property appraisals | |
| 5. Requirements for the development and reporting of business or intangible asset appraisals | |
| Ethics Rule | 1. Requirements for integrity, impartiality, objectivity, independent judgment, and ethical conduct |
| Record-Keeping Rule | 1. Workfile requirements for appraisal and appraisal review assignments |
| Competency Rule | 1. Pre-assignment and assignment conditions for knowledge and experience |
| Code of Professional Ethics | 1. Ethical requirements for AI members and professionals |
| 2. Definitions, cannons, and rules | |
| Standards of Valuation Practice (SVP) | 1. Set of high-quality, straightforward, principle-based standards that can be used where other valuation standards are not required or do not apply |
| Certification Standard | 1. Requirements for certification statements that AI professionals must make in written reports |
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What You'll Learn
Standards of Valuation Practice (SVP)
The Appraisal Institute's Standards of Professional Practice are composed of the Standards of Valuation Practice (SVP) and the Certification Standard of the Appraisal Institute. The AI SVP is a set of high-quality, straightforward, principle-based standards that can be used when other valuation standards are not required or do not apply.
The Standards of Valuation Practice (SVP) are designed to provide a consistent and ethical framework for conducting valuations. They outline the requirements for the development and reporting of various types of appraisals, ensuring that appraisers maintain the highest level of professionalism, integrity, and competency in their work.
Standards 1 and 2 of the SVP focus on real property appraisal, establishing the necessary procedures and guidelines for appraisers to value residential or commercial real estate. These standards ensure that appraisers consider all relevant factors, such as market conditions, property characteristics, and location, to provide an accurate and unbiased assessment of the property's value.
Standards 3 and 4 pertain to the development and reporting of appraisal reviews. These standards guide appraisers in evaluating the work of other appraisers, ensuring consistency, accuracy, and compliance with ethical standards. Appraisers conducting appraisal reviews are expected to possess the necessary knowledge, experience, and objectivity to critically assess the methodologies, assumptions, and conclusions of the original appraisal.
Additionally, Standards 5 and 6 of the SVP address the requirements for mass appraisals, which involve the valuation of a large number of properties or assets. These standards provide guidance on data collection, analysis, and modelling techniques to ensure accurate and consistent valuations, even when dealing with a high volume of appraisals.
Furthermore, the SVP also includes standards for personal property appraisals (Standards 7 and 8) and business or intangible asset appraisals (Standards 9 and 10). These standards recognise the unique challenges and considerations that arise when valuing items such as antiques, collectibles, intellectual property, and goodwill. Appraisers are provided with guidance on specialised valuation techniques, market research, and industry-specific factors to ensure fair and reliable assessments.
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Certification Standard
The Appraisal Institute's Standards of Professional Practice are composed of the Standards of Valuation Practice (SVP) and the Certification Standard, in addition to applicable national or international standards. The Certification Standard sets requirements for certification statements that AI professionals must include in their written reports.
Standards 1 and 2 of the Certification Standard establish requirements for the development and reporting of a real property appraisal. Standards 3 and 4 establish requirements for the development and reporting of an appraisal review. Standards 5 and 6 establish requirements for the development and reporting of mass appraisals. Standards 7 and 8 establish requirements for the development and reporting of personal property appraisals. Finally, Standards 9 and 10 establish requirements for the development and reporting of business or intangible asset appraisals.
The Appraisal Institute has also adopted a series of Guide Notes that provide guidance on how to apply the standards requirements in specific situations. However, it is important to note that these Guide Notes are not part of the Standards of Professional Practice.
In addition to the Certification Standard, the Appraisal Institute's Code of Professional Ethics establishes ethical requirements for AI members. This includes definitions, cannons, and ethical rules. The Valuers Code of Professional Ethics (VCPE) is a model code used by non-AI members as a companion document to the Standards of Valuation Practice.
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National standards
The Appraisal Institute's Standards of Professional Practice (SPP) are composed of two main parts: the Standards of Valuation Practice (SVP) and the Certification Standard of the Appraisal Institute. The SPP provides a set of high-quality, straightforward principles that can be applied when other valuation standards are not required or applicable.
The SVP is a set of standards that can be used when other valuation standards are not applicable. It is designed to be a straightforward, principle-based guide. The Appraisal Institute has also developed Guide Notes, which provide guidance on how to apply the standards in specific situations, though these are not part of the SPP.
The Certification Standard, on the other hand, sets requirements for certification statements that professionals must include in their written reports. These standards ensure that appraisers are providing accurate and reliable information in their reports, promoting trust and confidence in their work.
In addition to these specific standards, the Appraisal Institute also adheres to national and international standards. National standards, such as the Uniform Standards of Professional Appraisal Practice (USPAP), provide a framework for appraisers to ensure consistent and reliable practices within a specific country. These national standards are particularly important when conducting appraisals for financial institutions or regulatory bodies, as they may have specific requirements that appraisers must follow.
International standards, such as the International Valuation Standards (IVS), are developed by organisations like the International Valuation Standards Council (IVSC). These standards are recognised and adopted worldwide, ensuring a consistent approach to valuation practices across borders. By adhering to these national and international standards, the Appraisal Institute maintains a high level of professionalism and trust in its work.
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International standards
The Appraisal Institute's Standards of Professional Practice (SPP) include both national and international standards. The international standards referred to in the SPP are the International Valuation Standards (IVS), developed by the International Valuation Standards Council (IVSC). The IVSC has created the IVS to be used by valuation professionals around the world, and they have been adopted or recognised by many valuation institutes, user groups, and financial regulators.
The IVS are not the only international standards referenced in the SPP. The Appraisal Institute's Standards of Valuation Practice (SVP) are a set of high-quality, straightforward, principle-based standards that can be used when other valuation standards are not required or applicable. These standards are intended to be used by AI professionals and non-members alike. For non-members, the Valuers Code of Professional Ethics (VCPE) is provided as a companion document to the SVP.
The SPP also includes a Certification Standard, which sets requirements for certification statements that AI professionals must include in their written reports. The Appraisal Institute Body of Knowledge is another component of the SPP, serving as an authoritative source of recognised methods and techniques for valuation practitioners.
In addition to these specific standards and guidelines, the Appraisal Institute has also published Guide Notes, which provide guidance on how to apply the standards in various situations. These Guide Notes are not part of the formal Standards of Professional Practice but offer valuable context and instruction for their implementation.
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Code of Professional Ethics
The Appraisal Institute's Code of Professional Ethics establishes ethical requirements for AI professionals and members. The code includes definitions, cannons, and ethical rules. The ethical rules set forth the requirements for integrity, impartiality, objectivity, independent judgment, and ethical conduct.
The Appraisal Institute Standards of Professional Practice are composed of the Standards of Valuation Practice (SVP), promulgated by the Appraisal Institute, and the Certification Standard of the Appraisal Institute. The Certification Standard sets requirements for certification statements that AI professionals must include in their written reports.
The SVP is a set of high-quality, straightforward, principle-based standards that can be used where other valuation standards are not already required or do not apply. The Appraisal Institute has also adopted the International Valuation Standards (IVS) as an example of international standards that may apply to certain assignments. The IVS are developed by the International Valuation Standards Council (IVSC) and are recognised by valuation institutes, user groups, and financial regulators worldwide.
The Appraisal Institute has also adopted a series of Guide Notes that provide guidance on how to apply the standards requirements in specific situations. While these Guide Notes are not part of the Standards of Professional Practice, they are meant to help professionals understand and implement the standards in their work.
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