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For the record: record-keeping requirements are key to Al's Valuers Code of Professional Ethics.

The Appraisal Institute knows that clear, specific record-keeping requirements are of the utmost importance in preserving public trust in the valuation profession. Valuation development, reporting and record-keeping requirements are key components of the Valuers Code of Professional Ethics and the principles-based Standards of Valuation Practice that the Appraisal Institute created to help advance the valuation profession.

The Standards of Valuation Practice sets forth requirements regarding the work, while the Valuers Code of Professional Ethics sets forth requirements regarding the person. Within AI, we enforce standards (USPAP, SVP, IVS or other) differently from the way we enforce the Code of Professional Ethics; standards violations are enforced through educational counseling, while violations of the VCPE are enforced with disciplinary action. A principles-based document is one that sets forth broadly stated principles about how the professional must approach the work. A rules-based document is one that sets forth specific rules about how the work is to be done.

True standards are indeed standard--that is, they apply to all assignments. There needs to be a clearly drawn line between standards and methodology. While the former remain constant over time, the latter should be permitted to evolve as valuation practice evolves.

The Appraisal Institute is the historic leader in establishing standards and ethics for the valuation profession. Al's two predecessor organizations, which unified in 1991, were among the first to establish standards and ethics for the valuation profession--the American Institute of Real Estate Appraisers in 1932, and the Society of Real Estate Appraisers in 1936. Both regularly revised and strengthened their standards and ethics over the decades that followed.

So why, exactly, is record keeping so important in the valuation process?

The Appraisal Institute always has taken record keeping seriously, as evidenced by the fact that the organization's record-keeping rules for professionals are contained in the Code of Professional Ethics. That inclusion means that AI professionals who violate them are subject to disciplinary actions.

The Appraisal Institute will continue to promote use of the VCPE and SVP where appropriate while also seeking regulatory relief for its professionals at the state and national levels.

AI believes that well-qualified professionals are best positioned to provide valuation and advisory services to global and domestic clients, and its strategic initiatives are intended to uphold that position. We will work with those willing to help the profession provide services the market demands in a credible manner. We believe that the SVP and VCPE are easier to enforce because they are simpler, more streamlined and more straightforward.

While record keeping in general remains a priority for AI, as with many components of the valuation profession, it's all about the details.

Canon 2 of the VCPE, which addresses record keeping, provides that a valuer must maintain appropriate records. Additionally, record keeping is covered in the VCPE Ethical Rules addressing requirements for both written and oral reports. These requirements cover data, information and documentation necessary to support the valuer's analyses, opinions and conclusions, and to show compliance with the VCPE and applicable Standards of Practice, or references to the location(s) of such other documentation accessible to the valuer, among other requirements for written and oral reports.

The VCPE puts forth requirements for keeping records following the date of completion of the service, final disposition of a proceeding in which the valuer gave testimony as part of the service, and final disposition of a review of a service by a governmental licensing or credentialing body.

SCOTT ROBINSON, MAI, SRA, AI-GRS
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Copyright 2016 Gale, Cengage Learning. All rights reserved.

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Title Annotation:On Point: FROM THE DESK OF THE PRESIDENT
Author:Robinson, Scott
Publication:Valuation Magazine
Article Type:Correction notice
Date:Mar 22, 2016
Words:577
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