The Appraisal Practices Board (APB): Its Role and Function

1. The Appraisal Practices Board (APB): Its Role and Function Gary P. Taylor, 2012 Chairman Appraisal Practices Board

2. The Appraisal Practices Board (APB) is responsible for identifying and issuing opinions on Recognized Valuation Methods and Techniques, on all appraisal disciplines.  The APB offers voluntary guidance in various topic areas based on the current demands of the marketplace.

3. Rationale for creation of the APB • Many appraisers are not affiliated with a professional organization • Where can these appraisers find guidance regarding changing market conditions (i.e., foreclosures/short sales) The Appraisal Foundation is filling an existing void in the marketplace.

4. Recognized Valuation Methods and Techniques Valuation methods and techniques are those tools used to solve particular aspects of appraisal assignments.  They are the essential steps used throughout the appraisal process.

5. History of the APB • Approved by the Foundation Board of Trustees in October 2009 • Seven members appointed in May 2010 • Organizational meeting held in July 2010 • Established its policies & procedures in July 2010

6. APB Structure • Seven Members • Multi-Disciplinary • Business Valuers • Assessors • Real Property Residential • Real Property Commercial

7. How is the APB similar from the other Foundation Boards (the AQB and ASB)? • Same size and compensation as the AQB and ASB • Use of public exposure draft process All work product of the APB is exposed to the public for comment prior to adoption.

8. How is the APB different from the other Foundation Boards (the AQB and ASB)? • Use of outside experts (SMEs) in the drafting process • No Congressional authority • Guidance provided is strictly voluntary • Uses NO federal funds

9. Selection process for choosing Subject Matter Experts (SMEs) • Creation of a topic-related Statement of Work/Project Description/Application • Nationwide solicitation for applications • Selection of 6-8 candidates by the APB • Large pool of applicants for these positions

10. APB Topic Selection • Prioritization of topics by the APB • Periodic solicitation of stakeholders • APB groups and ranks the topics based on the needs of the marketplace

11. Drafting Process • SME Panelists and APB Liaisons hold conference calls and in-person meetings • APB reviews and edits the proposed drafts • Public exposure • Review of public comments by the APB • Additional revisions by SME Panel, as needed

12. Drafting Process • All work product of the APB is exposed for public comment prior to adoption.

13. The APB can include more than one valuation methodology in its Valuation Advisories; however, it is important to note that the Board is not creating any new methodologies. The APB only offers guidance on existing methodologies.

14. Valuation Advisories Completed To Date • APB Valuation Advisory #1: Identification of Contributory Assets and Calculation of Economic Rents • APB Valuation Advisory #2: Adjusting Comparable Sales for Seller Concessions • APB Valuation Advisory #3: Residential Appraising in a Declining Market

15. Current APB Projects: Real Property • Identifying Comparable Properties • Appraising Green Buildings (Series of 3) • Background Competence • Appraising Residential Green Buildings • Appraising Commercial Green Buildings

16. Current APB Projects: Valuation for Financial Reporting • The Valuation of Customer-Related Assets • Control Premiums for Financial Reporting • Contingent Consideration

17. Four Important Facts About the APB • Guidance offered is strictly voluntary • No tax-payer funds are used to operate the APB • The APB does not create new methodologies but rather compiles existing methodologies • The APB Valuation Advisories are available to all free of charge at www.appraisalfoundation.org

18. The Appraisal Foundation Appraisal Practices Board 1155 15th Street NW, Suite 1111 Washington, DC 20005 www.appraisalfoundation.org www.facebook.com/appraisalfoundation