What Is An Appraisal Report
I’ve been asked from time to time, “What do I get with an appraisal”. It’s a very good question if you’ve never had an appraisal preformed before. Besides all the requirements like pictures, gathering information, documents, and research, you get a professionally written Appraisal Report of your assets. Okay, that still doesn’t say what is an appraisal report. Let me break this down into sections for you.
A typical Appraisal Report consists of approximately 9 pages, plus a Schedule of Assets and Pictures. These usually follow the last page of the official report and are considered to be part of the complete report. I will discuss this in more detail a bit later.
What’s In The Report
The information contained in an Appraisal Report is quite extensive. The first page is the Title Page and as you would guess, it contains the information of who requested the appraisal, the name of the business they represent, their address and if a third party is involved. It also contains the information of the Appraiser, like the Appraiser’s name, their designation and the company name that they represent.
Next, as in most Reports, is the Index. This is a list of sections contained within the report and what page it is on. It is a quick reference to find what information you are looking for without having to go through the entire report. The following page holds a brief summary of the report, a valuation and a disclaimer. The valuation is the total appraised value of the assets. The entire report must be read and understood before this valuation is to be used for any purpose. Understanding the report is critical in order to apply the appraised value to the assets. There is more to an appraisal than the valuation numbers.
As you continue through the report, you come across the page with “Conditions and Limitations” as well as the “Certification of Report”. This states who the report is intended for and limits who is allowed to share the report. It also contains the appraisers name, designation, the company the appraiser represents, the appraisers signature and the effective date of the appraisal. The Purpose for the Report is also stated along with definitions of value. These go hand in hand as the purpose of the report determines what type of report is needed, for example; Fair Market Value
or Liquidation Value
. These are explained in later articles on my blog page. The date that the valuation was conducted is also stated.
What Affects The Value
There is a page that relates to the factors affecting the value of the assets. Within this page is a description of the age and condition of the assets, features and the market conditions at that time. All of these are necessary when determining the value of an asset. A professional appraiser will ask all the right questions before and during the appraisal process, in order to get all the relevant information regarding the asset. It’s not uncommon for an appraiser to contact the client several times during the research process to obtain more information of the assets.
The conclusion of the report is then stated with a brief description of the assets and the valuation figures again. The conclusion sometimes states the appraisers opinion of the assets including the market conditions for the assets, if they are being appraised for a potential sale. Finally we have the appraisers qualifications. As this suggests, it’s a brief outline of the education and experience of the appraiser that conducted the appraisal.
This is what you should expect in an Appraisal Report. As I stated earlier, there is also sometimes a schedule of assets listed as well as pictures. Within the schedule of assets, sometimes known as “Schedule A”, you will find a detailed list of the features of the assets. Some of the details could be year, make, model, mileage or hours, options, age, condition, special features, colour, author or artist’s name, etc… The individual appraised value is usually also included in the Schedule A, when there is more than one asset being appraised. This gives the reader details that were considered during the appraisal process and an understanding as to how the appraiser came to his conclusion. Pictures are also included and are an important addition to the report. They show condition of the assets as well as a confirmation of some of the features.
What Do I Get
This is what you will get when hiring DB Appraisals Ltd to preform an appraisal for you or your company. We provide you with a detailed, professional, accurate report every time. Your complete satisfaction is our main concern! Now that you know what is an appraisal report doesn’t mean you don’t have t
o ask what you get when interviewing an appraisal company. I encourage you to ask lots of questions and I’m sure you will find that DB Appraisals Ltd will not only answer them to your satisfaction, but will also give you the service you are expecting.
Darryl Bilobrowka, CPPA
Owner/President/Appraiser at DB Appraisals Ltd