TITLE I
Objectives and Ethical Standards
Article 1: Objective of the Technical Standards for the Preparation of Appraisals:
The Objective of the Technical Norms for the Preparation of Appraisals is to standardize concepts and criteria in order to obtain excellence and the highest level of professional practice in the preparation and review of reports.
Article 2: Ethical Standards of Compulsory Compliance:
The objective of the Ethical Standards of Compulsory Compliance is to guarantee the highest degree of professional ethics in the preparation and review of reports; which must be fulfilled by both independent appraisers and companies and organizations that carry out the appraisal practice, placing emphasis on their ethical, civil, criminal and safeguarding obligations and responsibilities for public assets.
Article 3: The Assessor or the professionals that make up companies and organizations that work in the appraisal practice, must strictly comply with these Technical Standards.
Article 4: The Assessor or the professionals that make up companies and organizations that work in the appraisal practice, must never commit or engage in illegal actions, contrary to professional ethics or inappropriate for a professional.
Article 5: The Assessor or the professionals that make up companies and organizations that work in the appraisal practice, must be constituted as a neutral person to the parties involved, whose action is limited to the execution of an Appraisal Report, Review of a Appraisal or Consulting Service; performing with impartiality, equity, objectivity and independence and without accommodating personal interests of any kind.
Article 6: The acceptance by an Appraiser or the professionals that make up companies and organizations that work in the practice of appraisal, of a compensation conditioned to the determination of a Predetermined Value or aimed at favoring or disadvantaging the cause of the client, in order to achieve a result in a subsequent event; as well as receiving a hidden payment of professional fees, commissions, valuables or goods, in relation to the appraisal, review or consulting contract; it is considered a Serious Failure to Professional Ethics.
Article 7: The propaganda or publicity made in a false or exaggerated way, to obtain or request assignments or appraisal contracts; that lead the prospective client to a wrong appreciation about the experience or expertise of the Assessor in a specific area, is considered a Serious Lack of Professional Ethics.
Article 8: The Assessor or the professionals that make up companies and organizations that work in the practice of the appraisal, must compulsorily protect the confidential nature of the relationship between the Assessor and the Client. The Assessor shall never disclose confidential information obtained from a client or the results of an assignment made for a client, to any other person, corporation or institution unless:
a) The Client expressly authorizes the disclosure of the information
b) By court order the appraiser is requested to disclose the information to the corresponding jurisdictional authority
c) The SOITAVE Disciplinary Court, constituted and in session to review said report, requested by complaint by natural or legal persons who have proven interests in the case or have been harmed by the Value Opinion of an Active Member appraiser by SOITAVE.
Note 1: It will also be considered a Serious Lack of Ethics, the fact that one or more members of the SOITAVE Disciplinary Tribunal, reveals confidential data presented before that Tribunal.
Note 2: By analogy, this paragraph is applicable to the case of a complaint before the Disciplinary Tribunal of the College of Engineers of Venezuela.
Article 9: The Assessor or the professionals that make up companies and organizations that work in the practice of the appraisal, must file the Appraisal, Review or Consulting Reports, at least Ten (10) years counted from their delivery or the termination of the trial in case of judicial expertise.
Article 10: Before accepting an assignment, the Assessor or the professionals that make up companies and organizations that work in the appraisal must:
a) Clearly identify the object of the appraisal to be carried out
b) Have the knowledge and experience to carry out the assignment competently
c) In the event that once the assignment of the case has been accepted and in the middle of it, the Assessor discovers that he does not have the knowledge or experience necessary to carry out the assigned mission, he must disclose it to the client, suggesting the professional members of SOITAVE that their criteria are specialists in that type of case.
NOTE 1: The fact of notifying the client of not having the necessary knowledge or experience does not necessarily imply the non-execution of the assigned assignment; if not, rather the association or contracting with one or more appraisers who are trusted to have the knowledge or experience necessary for the completion of it. In any case, the client must be notified of the incorporation of the specialists to the valuation team.
Note 2: The Assessor or the Professionals that make up companies and organizations that perform the Appraisal practice are responsible for judging the level of work of the associated or contracted assessors for the execution of the assignment.
Note 3: The contribution of the associated or contracted appraisers for the execution of the assignment must be expressly recognized in the same report.
d) In the event that the Assessor is assigned a case in a geographical location where he has not had experience of recent appraisals or no experience; The Assessor must stay long enough on the site to understand the characteristics of the local market, the supply and demand factors related to the specific type of asset to be valued and other parameters related to the sector.
Note 4: If the Appraiser is not in a position to stay the necessary time in the area to obtain the knowledge, the most appropriate thing would be the association or hiring of a qualified local appraiser to ensure the correct completion of the corresponding appraisal report.
Note 5: As in Article 10, the Assessor must notify his client of the association or hiring of the Local Assessor, whose contribution to the preparation of the Technical Appraisal Report must be recognized therein.
TITLE II
On the Preparation of Technical Assessment Reports
Article 11: For the preparation of an Appraisal Report, the Assessor must understand and correctly use all the methods and techniques, commonly accepted, to produce a Technical Report adjusted to reality and perfectly verifiable, avoiding errors or omissions, which although considered individually do not significantly affect the determination of the Value; but when considered as a whole, they would lead to a wrong interpretation of the same and could seriously harm the client, third parties or the patrimony of the nation.
Article 12: The Assessor or the professionals that make up companies and organizations that work in the practice of the appraisal, must personally inspect the property that is the object of the Report, leaving a written and photographic record of the property, as well as its description, state of conservation and condition of the same in the body of the Technical Report or in its annexes.
Note 1: If the Assessor cannot or does not have sufficient experience to carry out the inspection, he may associate or hire a qualified assessor to ensure the correct description of the property.
Note 2: As in Article 10, the Assessor must notify his client of the association or hiring of the Assessor, whose contribution to the preparation of the Technical Assessment Report (in this case the inspection of the property) must be recognized in the same.
Article 13: In the Technical Appraisal Report, the Assessor must express in each of the analyzes carried out and in the conclusion of the Value, a result that does not give rise to erroneous interpretations, so that the Technical Report contains sufficient information to allow the client or reviewers to understand and interpret it correctly.
Article 14: Every Technical Appraisal report must include at least:
a) Identification of the person or entity to whom the Technical Report is addressed or requested, as well as the Identification of the Assessor, Appraisers or Appraisal Company that prepared it
b) Complete identification (geographical, planimetric or legal) and description of the property that is the object of the appraisal
c) Statement of the Purpose of the Appraisal
d) Legal status of the property object of the appraisal
e) Definition of the value to be estimated
f) Establishment of the effective date of the appraisal (date of the data collection and inspection of the asset) and of the date of the Technical Report (date of the preparation or presentation of the report)
Note 1: It is important to note that market conditions may vary in the period of time between the Effective Date of the appraisal (period of time during which the data was collected and the values were inferred) and the Date of the Technical Report (date of completion and publication of the final results of the appraisal)
g) Description of the data collection process, citing the source of the data
h) Presentation of the Valuation Procedures used and justification of the analysis, opinions and conclusions of the report
i) Justification and support for the exclusion of any of the commonly accepted valuation approaches
j) Determination of the value of the asset
k) Inclusion of a certification of impartiality
l) Annexes, plans, photographs, etc.
Note 2:: In the case of specific Appraisals such as Expropriation Appraisals and Tenant Appraisals; where the respective Legislation requires the use of Mandatory Appreciation Factors, they must be applied as well as their corresponding jurisprudence, without prejudice to the minimum requirements mentioned in this article.
Article 15: In the preparation of a Technical Report on the Appraisal of a Going Company, related to an equity participation capable of causing its liquidation, the Assessor must investigate the possibility that it may have a higher value in its liquidation, which the value of the continued operation as a going concern.
Note 1: The Assessor is only obliged to carry out this analysis in the event that the net worth of the company that is the object of the Appraisal Report, is in a position to be liquidated.
Note 2: If the liquidation of the company is the appropriate premise for the determination of its value; real estate, fixed assets, inventories and raw materials must be valued separately.
TITLE III
About the Impartiality Certification
Article 16: Minimum content of the Impartiality Certification
Every Technical Appraisal report must contain a Certification of Impartiality, the minimum content of which will be the following:
1.- Certification that the Technical Assessment Report is the product of essentially objective, scientific and commonly and universally accepted methods
2.- Certification that the appraiser or appraisers have not been influenced by any personal intention or feeling that could alter in the least the procedures, methodology, data collection, convictions, criteria, special considerations and conclusions
3.- Certification that the appraiser or appraisers have no interest, direct or indirect, with the valued asset, neither present nor future
4.- Certification that the appraiser or appraisers are not bound, with the client or with the owner of the property, family ties or of any kind
5.- Certification that the appraiser or appraisers have been hired to carry out the Technical Report, solely in their capacity as competent professional and aware of their duties and responsibilities
6.- Certification that the appraiser or appraisers who have obtained data from third parties or files from private or public institutions, necessary for carrying out the appraisal study, are true to the best of the good faith of the Appraisers.
7.- Certification that the appraiser or appraisers who have not consciously exaggerated or omitted any important factor that may influence the result of the Technical Report
8.- Certification that the appraiser or appraisers have not conditioned their professional fees to the determination of a Predetermined Value, or a Value aimed at favoring the cause of one of the parties, or obtaining a result conditioned to a subsequent event that may happen
9.- Certification that the appraiser or appraisers have prepared their assignment attached and in accordance with these Technical Standards for the Preparation of Appraisals
10.- Certification that the appraiser or appraisers have personally inspected the property that is the object of the Appraisal Report; In the event that the appraiser or appraisers signing the report have not carried out said inspection, the person or persons (associates, contractors or employees) who carried out said inspection must be identified in the Report.
11.- Certification that the appraiser or appraisers have not received significant professional assistance in the preparation of the Technical Report; otherwise, the professional or professionals who provided the assistance must be identified in the Report, specifying the kind of advice
TITLE IV
About the Technical Review of Appraisals
Article 17: The Assessor who signs a Technical Appraisal Report, prepared by another person, will assume full professional, civil, criminal and safeguarding responsibility for the public heritage for the content of said report.
Article 18: When a “Professional Reviewer” reviews and reports on the results of said review, said professional must form an opinion as to the adequacy and propriety of the Technical Report that is being reviewed, and must clearly indicate the nature of the review process. review you performed.
Note: The Review Report is a different product, both in its process and in its presentation of the Technical Assessment Report.
Article 19: The function of reviewing an appraisal necessarily requires the preparation of a separate report, where the results of the review process are established. The Professional Reviewer will verify the degree of coherence, integration and consistency of the revised Technical Report.
Article 20: Technical Regulations for the Review of an Appraisal Report
When reviewing a Technical Assessment Report, the “Professional Reviewer” must at least report on:
1.- Review of the Technical Assessment Report:
a) Verification of the location and description of the Property that is the object of the Appraisal
b) Clearly indicate the date of the Appraisal Report and the date of the Review Report
c) Opinion on the veracity of the technical and documentary supports used by the appraiser
d) Opinion on the veracity and correspondence of the data collected such as selected references, zoning, type of construction, age, state of conservation, etc.
2.- The methodological foundation of the Appraisal Report
a) Opinion on the methodology and valuation techniques used, explaining the reasons for any disagreement
b) Verification and numerical revision of the mathematical and statistical calculations used by the appraiser
3.- The review of all the attached information related to the revised Technical Appraisal Report, which served as the basis for reaching a conclusion on the value opinion
Article 21: A revised Appraisal Report will be classified as: “Technically Well Prepared ”, if the certification of all the facts and data reported by the Professional Reviewer were successfully verified and / or their opinion was favorable.
Otherwise, it will be declared as "Inadmissible", as the review thereof is not observed in compliance with the Technical Standards established herein or "Unverifiable", if the report lacks sufficient data for review.
Note: In each case, the appraiser must be notified in writing in order to complete or supplement the Technical Report presented.
Article 22: Minimum content of the Impartiality Certification applicable to the Review of a Technical Appraisal Report
Every "Review Report" to a Technical Assessment Report must contain a Certification of Impartiality, the minimum content of which will be the following:
1.- Certification that all the facts and data reported by the “Professional Reviewer”, used in the review process, were verified
2.- Certification that the “Professional Reviewer” has not been influenced by any intention or personal feeling that could alter the review procedures in the least.
3.- Certification that the “Professional Reviewer” has no interest, direct or indirect, with the valued asset, neither present nor future
4.- Certification that the “Professional Reviewer” has not carried out a personal inspection or through associates, contractors or employees, to the object of the revised Appraisal Report.
5.- Certification that the “Professional Assessor” has not conditioned his professional fees to the result of the conclusions of the Inspection Report.
6.- Certification that the “Professional Reviewer” has prepared his assignment in accordance with and in accordance with the Valuation Methodologies commonly accepted.
7.- Certification that the “Professional Reviewer” has not received significant professional assistance in the preparation of the Review Report, otherwise the professional or professionals who provided the assistance must be identified in the Review Report, specifying the kind of advice.
TITLE V
About Updating Appraisals
Article 23: Definition of Updating an Appraisal
It is defined as “Update of an Appraisal”, an extension to the Original Appraisal Technical Report, which the client entrusted to the Appraiser in a past decision, where the new Updated Value of the Property is reflected for the Update date
Article 24: Conditions for an Appraisal Update to be appropriate
Because the Update is an extension to the Original Appraisal Report, the Assessor must observe that the following conditions are met, before accepting an Update assignment:
a) Both the Appraiser or Appraisers who made the Original Appraisal Technical Report, as well as the client or applicant, must be the same persons
b) The asset should not have had significant changes since the Original Appraisal Report was made
c) The period between the date of the Technical Appraisal Report or its most recent update and the New Update Report, is not too long for the type of good
Article 25:: If the three conditions established in the previous article are not met, the requested report will be considered as a New Technical Appraisal Report and it must be carried out in accordance with the Technical Standards established herein
Article 26: Minimum Content in an Appraisal Update Report
a) Reference to the Original Appraisal Technical Report or its latest update
b) Determination of any change in market conditions that occurred between the dates of the Original Report and the Update
c) Determination of any physical, legal or technological change of the asset that occurred after the date of the Original Appraisal Report
d) Determination of the New Updated Value of the Property
e) Certification of Impartiality
f) Annexes containing the presentation and analysis of all the data considered in the determination of the new updated value
TITLE VI
Miscellaneous Aspects
Article 27: Retrospective, Current and Prospective Appraisals
In order to avoid confusion and to avoid an erroneous interpretation, the Technical Assessment Reports may be classified into the following categories:
a) Retrospective Appraisals: These are those whose Effective Date is much earlier than the Date of the Technical Appraisal Report, this type of study may be required for matters related to property taxes, inheritances, successor declarations, compensation lawsuits, etc.
b) Current Appraisals: Are those whose Effective Date coincides with the Date of the Technical Appraisal Report, or is very close.
c) Prospective Appraisals: Those whose Effective Date is much later than the Date of the Technical Appraisal Report, this type of study may be required to estimate participations in future projects and other reasons
d) Unique: Only Current Appraisals, that is, those that determine the Updated Value of an asset will be recognized as Appraisal Reports; Considering Retrospective and Prospective Appraisals only as Technical Studies
Article 28: Duration of the Assessor - Client relationship
a) A defined term cannot be established to end the relationship between the Assessor and his Client
b) A reasonable period to limit this relationship would consist in considering the Appraiser - Client relationship as terminated, when the use for which the appraisal was required has been completed, such as obtaining a loan when the Technical Appraisal Report was used. to constitute the amount of the guarantee required by the borrowing entity
c) When a third party requests professional services to value an asset or assets where the appraiser reasonably assumes that a previous Appraiser-Client relationship is still in force, the Appraiser must request an exoneration (preferably in writing) from his previous client, before accept a new assignment on said assets
Bibliography
- UNIFORM STANDARDS FOR THE PRACTICE OF APPRAISAL: American Society of Appraisers (ASA). 1994 UNIFORM STANDARDS OF PROFESSIONAL APPRAISAL PRACTICE: American Society of Appraisers (ASA) 1992 DEPOSIT GUARANTEE FUND AND BANK PROTECTION (FOGADE), Asset Management Management: Regulations to be Considered in the Valuation Reports 1994 Organic Law that Regulates Assets Public Sector Not Affected to Basic Industries. Official Gazette of the Republic of Venezuela No. 3591 Extraordinary dated 01-07-87 BANCO CONSOLIDADO, CA, Vice-presidency of Real Estate: Regulations for the preparation of Technical Valuation Reports. 1995 MINISTRY OF FINANCE, Commission for the Alienation of Public Sector Assets Not Affected to Basic Industries (CENBISP):Instructions on the Information Required for the Authorization of the Alienation of an Asset (no date) BANCO INDUSTRIAL DE VENEZUELA, Appraisal Management: Requirements for the Preparation of Technical Assessment Reports (no date) URBAN DEVELOPMENT FUND (FONDUR), Management of Lands: Norms for the preparation of Appraisals (no date) RODRIGUEZ Héctor and GARCIA Aimara, The Appraiser Larense No. 3, Year 1, March 1997 (Article): “The Appraisal Reviewer”
