Austin
Elite Member
- Joined
- Jan 16, 2002
- Professional Status
- Certified General Appraiser
- State
- Virginia
In relation to inconsistencies in USPAP, David and Terrell in an above post mentioned business appraisals of mineral rights being covered under standard 9. I ran into something similar at an AI class on appraising nursing homes. The instructor was the leading authority in the field and he was telling us how we had to break down value components into real estate, personal property, inventory, trade fixtures, goodwill, etc. He said that was the way he did it. I asked him if he reported a value for personal property and some of these other categories, even though they are part of the enterprise, how he complied with standards 7 & 8 covering development and reporting a personal property appraisal, and standards 9 & 10 regarding development and reporting of business appraisals not to mention standards 1 & 2 covering the real estate component. Under existing business appraisal theory of a going concern, to be technically correct under USPAP as I read it, you would have to comply with standards 1, 2, 7, 8, 9, & 10 using three development and three reporting requirements. Any business appraisal would consist of three appraisals it seems to me. The instructor would not answer my question. He just smiled moved on. One of many reasons I don’t do business appraisals.