Appraisal Witness: Qualified Expert

Appraisal Witness: Qualified Expert

A Personal Property Appraisal

Tuesday, February 12th, 2008 6:28pm

Personal property appraisal covers all property that is not real estate even if the property belongs to a corporation, business, trust or organization. The first thing an appraiser must do is identify the purpose (business valuation, merger, acquisition, loan, insurance, decedent estate, divorce or many other reasons) for the appraisal, determine the scope of work required to meet the purpose, then research and analyze the purpose in order to develop an appropriate appraisal. SINCE Congress has required the USPAP (The Uniform Standards of Professional Appraisal Practice) to be applied when appraising personal property, few appraisers have studied USPAP or passed the government test that qualifies them to continue in the appraisal business. Durkin Valuation Associates have numerous appraisers from 30 years experience appraising and we are willing to testify as expert witnesses anywhere in the world. Telephone: (617) 720-0332

In developing a personal property appraisal, the appraiser MUST NOT:

  • Deliver appraisal services in a careless or negligent manner, such as making a series of errors that alone would not be significant, but together adversely affect the appraisal;
  • Commit a substantial error of omission or commission that notably affects the appraisal,
  • Be bias in any manner,
  • Agree to take a percentage fee depending on the outcome of the appraisal use.
  • In developing a personal property appraisal, the appraiser MUST:

  • Determine the scope of work according to the Scope of Work Rule;
  • Be informed of, understand and employ the accepted methods and techniques for producing a credible appraisal;
  • Identify what the appraiser’s opinions and conclusions will be used for;
  • Identify the type and definition of value;

    If market value is to be used, determine whether the value is to be the most probable price.
    If the value is to be based upon non-market financing or financing with unusual conditions or incentives, the financing terms must be clearly stated, along with the appraisers opinion regarding the contribution or negative influence the financing conditions place upon the value, determined by an analysis of the relevant market data including identification of the client and other intended users;

  • Identify the characteristics of the property that are relevant to the type and definition of value and the intended use of the appraisal, including:
  • The ownership interest to be valued;
  • The characteristics used to establish the value and identity of the item and the methods of identification;
  • The characteristics used to establish the quality of the item (including separate component parts where applicable); and
  • Any other physical and economic features that have a material effect on the value;
  • Identify any extraordinary assumptions necessary in the assignment if the following conditions or circumstances warrant an extraordinary assumption:
  • It is required to properly develop credible opinions and conclusions;
  • The appraiser has a reasonable basis for the extraordinary assumption;
  • The use of the extraordinary assumption results in a credible analysis; and
  • The disclosure requirements set forth in USPAP for extraordinary assumptions are followed by the appraiser.

  • Identify any hypothetical conditions required to adequately complete the assignment if the following conditions or circumstances warrant a hypothetical condition:
  • Use of the hypothetical condition is obviously needed for legal purposes in order to perform a reasonable analysis or comparison,
  • Use of the hypothetical condition results in a credible analysis; and
  • The disclosure requirements of the USPAP for hypothetical conditions are followed by the appraiser.
  • Durkin Valuations (617) 720-0332

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    Appraisal Methodology

    Sunday, February 03rd, 2008 12:40pm

    An appraisal witness will provide appraisal methology, documentation, and conform to USPAP guidelines. Photographs and evaluation of condition of the personal property, equipment, machinery or vehicles should accompany all appraisals.

    Below are the three types of appraisals that can be carried out by the expert appraisal witnesses at Durkin Valuations. Durkin Valuation Associates have numerous appraisers from 30 years experience appraising and we are willing to testify as expert witnesses anywhere in the world. Telephone (617) 720-0332

    FAIR MARKET VALUE:
    A price agreed on by both a Buyer and Seller, neither being under any obligation, to complete a sale.

    Fair Market Value is used for Inheritance Tax, Estate Planning, Marital and Business Division, and Charitable Contributions.

    REPLACEMENT VALUE:
    The cost to replace property with something of similar origin, condition, provenance, quality and age.

    Replacement value is used for Insurance purposes, and is attached to your policy, as a Fine Arts Rider.

    LIQUIDATION VALUE:
    A monetary value given to property that is sold or exchanges hands under a forced or limiting conditions, such as bankruptcy.

    Expert Appraisal Witness
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