Deborah Finleon, GIA GG
Updates to Report Writing Standards
You will have noticed something extra included with your membership renewal this year – an entirely updated Report Writing Standards booklet! We recently completed a comprehensive review of the Report Writing Standards for Appraisal Content© – formerly the Minimum Standards for Appraisal Content – and want to outline the changes for you here.
Substantively, little has changed. In fact, with few exceptions, the details – and particularly the specific requirements for diamond and gemstone reporting by size and type – are much the same. The vast majority of the updates involved formatting and organization of both the overall structure of the report and the elements within each section, rather than the content. We have worked hard to make sure that our expectations for a USPAP- and NAJA-compliant report are now clear and easy to follow.
Below, a brief outline of the changes…
1. Report Structure – page 2 of the booklet now clearly outlines the expected structure of the report. There are eleven (11) elements which are typically included in a report. Those listed in bold are mandatory. The order of the elements is up to the appraiser, with one exception. The Cover page, which is mandatory, obviously should be first. A Table of Contents would be second, if present. The Scope of Work should be the first main section thereafter, as it explains the essentials of the report: dates, intended use and users, purpose, definitions, etc. The remaining sections may be included in whatever order the appraiser prefers. As in previous versions of the Minimum Standards, page numbers and total number of pages must be included.
2. The Cover is now a mandatory element, but the content of that cover is up to the appraiser, with, again, one exception. Per USPAP, a report must be titled in one of two ways, either “Appraisal Report” or “Restricted Appraisal Report.” Modifiers, such as “Insurance” or “Estate” may also be used, but one of the two titles is required.
3. Scope of Work – as with the overall report structure, the mandatory elements of the Scope of Work are listed in bold. The remaining optional elements should be included if they pertain to a particular report. Again, the majority of the updates to this section were made for organization and clarity. There are only two substantive changes to note.
Per USPAP, the three Approaches to Value must be defined and a statement as to which approach was used in the report and why must be included.
The requirement for inclusion of an abbreviated confidentiality statement has been removed from this section, as we now require a separate Privacy/Confidentiality Statement elsewhere in the report.
4. Assumptions and Limiting Conditions – we have slightly updated the wording of some of the statements and have added a statement regarding comparables (item d). As before, please adjust the list to suit the particular report and your own appraisal practice, utilizing only those statements which apply in a particular case. For example, reports containing only a solitaire diamond ring should not contain statements about opening watch cases. These statements are typical and not specifically required verbatim, though we certainly recommend their use in a professional report. You are also free to include additional statements, if you wish.
5. The Privacy/Confidentiality Statement has been required for several years now. As before, the specific content is up to the appraiser, but we share an updated example in the RWS which may be used if desired, tailored carefully to the appraiser’s own policies.
6. The Certification of Appraisal Practice continues, of course, to be required, as written in the latest version of USPAP. Please remember to delete the phrases in the Certification which are in parentheses, unless they apply to your particular report! The Certification must be dated and signed.
7. The Body of Appraisal Report (the valuation page) requirements have not changed. However, this section was rewritten for clarity. The first segment describes the eight elements required in every Body. The “Description” segment describes the elements which should be included in the description of both the jewelry item as a whole and the mounting in particular. Then, the “Colored Gemstone” and “Diamond” segments break down the description requirements by general – what all descriptions must include – and then by weight of the stones being described. As before, requirements for Phenomenal Stones, Pearls, and Opals follow.
8. Note – Just to remind you, while we’re talking about reports – there are always three signatures required in any report: at the end of the Scope of Work, at the end of the Body of the Report, and at the end of the Certification of Appraisal Practice. Digital signatures without seals are acceptable for PDF reports. Embossing seals (available through the NAJA bookstore) are still required on all original signatures for those who have earned the Member designation or beyond.
We will be offering a webinar outlining these changes and taking your questions later in February. Please watch the Continuing Education section of the website and your inbox for more information.
In the meantime, don’t hesitate to contact me directly with any questions at firstname.lastname@example.org or 703-994-9001.