Appraisal FAQ’s

Will I need an appraisal?

Clients purchase appraisals for a variety of uses. In some cases, government agencies, bankruptcy courts, lessors, or lenders will require an appraisal by an independent, third party appraiser. A third party appraisal provides an unbiased opinion of value that is used for collateral financing, settlements (i.e. bankruptcy, divorce, partnerships), determining sale price, disputing property taxes, insurable value, liquidations, allocation of purchase price, and portfolio management. Properly performed USPAP-compliant appraisals meet the strict requirements of bank lending and tangible personal property tax valuation, and are also defendable in depositions and court proceedings. For What It’s Worth Appraisals, Inc appraisals are reviewed and signed by an Accredited Senior Appraiser (ASA). Our reports are USPAP-compliant and comply with the ethical standards of the American Society of Appraisers. We specialize in machinery & equipment appraisals and inventory valuations.

Why should I choose and ASA-accredited appraiser?

When a business decision relies on the value of tangibl e property, it’s important to know and understand the qualifications of the machinery and equipment appraiser. You’ll want to ensure that the appraiser has an accreditation in Machinery & Technical Specialties from a reliable organization. Accredited Senior Appraisers (ASAs) with a Machinery & Te chnical Specialty (M&TS) have received their credentials by the American Society of Appraisers – the highest rated accreditation organization for machinery and equipment appraisers.

Experience
- Minimum of 5 years of full-time appraisal experience in the specific appraisal discipline
Education
- Four-year college degree or equivalent
Background check
- Experience, education, references, financial, integrity
Appraisal report writing
- Submitted and passed a peer review of an appraisal report. Report must demonstrates the appraiser’s competency in applying proper appraisal methodology and to adhere to the standards of USPAP (Uniform Standards of Professional Appraisal Practice), as well as the American Society of Appraisers’ code of ethics
Educated and tested in appraisal theory
- Completed courses and passed the exams for a 15-hour USPAP course and for the four Principles of Valuations courses. Passed the ASA ethics exam.

ASA minimum requirements for 5-year Re-accreditation

Reaccredited every 5 years
- Completed a 7-hour USPAP update course every two years and earned at least 100 credit hours every 5 years (minimum of 40 CEU in continuing education)

Does your appraisal firm have national coverage?

Our team of experienced employees and collaborators provide inspections nationwide for machinery & equipment appraisal inspections and inventory sample counts. Our team coverage enables us to provide competitive rates. Collaborating with Cloud technology, we are able to achieve the faster turnaround times required by our clients.

What should I expect in an appraisal report?

Tangible property appraisal reports (i.e. machinery & equipment, inventory, etc) are as varied as the appraisers preparing them. Before hiring an appraiser, consult with him/her to ensure that you will be getting the level of reporting that you require for your purposes. (Learn more about our process.)

The Uniform Standards of Professional Appraisal Practice (USPAP) determine the minimum standards for both applying appraisal processes and for reporting the results of those processes. USPAP is the recognized appraisal standard in the United States, but is also widely recognized by countries throughout the world.

USPAP requires specific data collection, methodology, and reporting including the following:

include a USPAP-compliant certification, signed by the appraiser
list the intended users
explain the intended use of the report
identify the subject property
state the current use of the property
state the property interest
definition of value(s)
effective date of the valuation
appraisal report date
explain the scope of work performed
address the consideration of the three approached to value
explain the source information, appraisal methods, reasoning, and conclusions explain any extraordinary assumptions and hypothetical conditions
A properly written report should be concise and written to the level of valuation knowledge of the client and intended users to clearly address the considerations and factors that affect the value of the subject property.For What It’s Worth Appraisals, Inc appraisals are reviewed and signed by an Accredited Senior Appraiser (ASA) and are USPAP-compliant. Our appraisals are defendable because our values are backed by solid evidence and professionally accepted appraisal practices.

What is USPAP?

The Uniform Standards of Professional Appraisal Practice (“USPAP”) is updated and published every two years by the Appraisal Standards Board of the Appraisal Foundation. This Foundation sets the Congressionally-authorized standards to both advance the appraisal profession and to ensure that appraisals are independent, consistent, and objective. USPAP identifies a set of standards that apply in all appraisal assignments.

What does an appraisal typically cost?

We have nationwide coverage of experienced investors, so we are competitively priced in all markets.

Inventory valuation and Machinery & Equipment appraisal costs vary based on multiple factors:

number of assets to be valued (or number of SKUs for inventory valuations)
level of details available on the asset list provided to the appraiser
asset locations and distance between them
industry type
client’s schedule requriments
number of levels of value required (FLV, OLV, FMV, etc)

Here are some tips that may help you minimize the cost of an appraisal:

Contract with an appraiser early
- Machinery & equipment appraisals can take weeks or months to properly complete.
- Consider cost of short-notice airfare and rush appraisal fees
Detailed asset listing
- If time permits, provide the appraiser with a detailed list of: quantity, asset type, year, make, model, serial number
- Avoid combining assets into groupings, where the appraiser cannot determine the number of assets in the group
Provide the asset list in an electronic format
- Microsoft Excel is preferred
- The appraiser can apply OCR techniques to large files not provided electronically, but this can contribute to a higher fee for the extra processing time
Limit the scope of work
- Omitting low-value items like furniture and office equipment can make an appraisal much more economical
- If sites are similar, we can apply sample, representative inspections with results applying to all locations
Condense locations
- When economically feasible, move the assets to a central location for the inspection. Example: fleet vehicles or construction sites.
- For inventories, narrow the scope of work to include only a sample count inspection of the warehouse locations storing the higher const concentrations

With an asset list or inventory perpetual report, For What It’s Worth Apprasials, Inc. can usually provide a flat-rate quote, stating a turn-around time in which you can expect your report

How long does it take to get the finished appraisal report?

When it comes to making good business decisions, include the appraisal order early on in your process. The asset list is the best indicator of the time involved for the inspection, research, valuations, and report writing. Generally, the more line items, the longer the appraisal will take. Providing a detailed asset list at the quoting stage will allow the appraiser to give a more reliable estimate of time required. Machinery and equipment appraisals can take anywhere from a few days to a month or more to complete. If time allows and when economically possible, supply the appraiser with quantity, year, type, make, model and serial number for each line item and submit the information in an electronic format (ex: Microsoft Excel). Inventory valuations can also take one week to over a month, depending on number of SKUs and distance between warehouses for sample counts. The first step in the quoting process is to submit your asset list or inventory perpetual report to the appraiser. The more information we have, the more accurate we can be with our rate and turnaround time. We can help you produce these lists. Let’s get to work!

What is the difference between a desktop and an inspection appraisal?

Desktop appraisals do not include an inspection of the subject property. This type of appraisal is typically performed in cases where the property is hypothetical (i.e. work-in-progress), is unavailable for inspection, or has already been sold or disposed. Desktop appraisals can be performed with credibility when sufficient details are available for the appraiser to arrive at sound conclusions of value. Appraisers performing desktop appraisals must still follow all of the requirements of USPAP. For What It’s Worth Appraisals, Inc can help you determine if your assets can be properly valued without a physical inspection. We specialize in machinery & equipment appraisals and inventory valuations. Appraisal purposes vary, but inventory valuations typically require an inspection with on-site sample counts.

How do I choose a level of value?

The levels of value are determined by the use of the appraisal report. A clear understanding of the level of value selected – compared to the alternative choices – is important in understanding the valuation determination in the appraisal report.

Lenders typically request Orderly Liquidation Value and/or Fair Market Value for new loans and Forced Liquidation Value (i.e. auction value) for defaulted loans or bankruptcy proceedings.
Insurable value is typically Cost of Replacement or Fair Market Value
Florida Tangible Personal Property Tax law requires “just value”, which has been determined to be synonymous to Fair Market Value.
Planned liquidation sale periods may vary, so Forced Liquidation and/or Orderly Liquidation Value may be applied
Other levels of value may be pre-determined by contractual language, such as in lease agreements or partnerships.

For What It’s Worth Appraisals, Inc can assist you in choosing a level of value that meets your purposes.

What types of property do you appraise?

With over 15 years of experience, our appraisal expertise spans across multiple industries. We are not limited to appraising specific property types. As educated and experienced generalists, we know how to apply professional accepted appraisal practices to most property types. Our experience includes a variety of manufacturing and industrial processing assets as well as stand-alone property types. We also specialize in Inventory Valuation.

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