Question:

I am considering the purchase of another appraiser’s appraisal practice. What are my USPAP obligations regarding record keeping and confidentiality?

Response:

The acquiring appraiser has general USPAP obligations to protect public trust in appraisal practice. The PREAMBLE states:

The appraiser’s responsibility is to protect the overall public trust and it is the importance of the role of the appraiser that places ethical obligations on those who serve in this capacity.

The ETHICS RULE states:

To promote and preserve the public trust inherent in professional appraisal practice, an appraiser must observe the highest standards of professional ethics.

In the sale of an appraisal practice, the acquiring appraiser should respect the selling appraiser’s obligations under the Confidentiality and Record Keeping sections of the Ethics Rule.

The acquiring appraiser does not have an appraiser-client relationship with the clients of the selling appraiser, but the acquiring appraiser’s obligation to protect public trust creates a responsibility when access is provided to another appraiser’s workfile. The acquiring appraiser should treat the acquired assignment results and confidential information in the workfiles in compliance with USPAP.

The acquiring appraiser should honor the workfile retention, access, and retrieval arrangements made by the selling appraiser in compliance with the Record Keeping section of the Ethics Rule.