The policies and procedures are intended to guide the day-to-day actions of staff who do not have constant contact/supervision, or who encounter unusual situations. To be useful, effective, and fair these guides must include (a) the policy statement, (b) the purpose for the policy, (c) the persons who are involved in the policy, (d) their duties, authorities and responsibilities, and (e) the procedures to be followed.

For example, a company that invests in real estate for its own account or on behalf of investors should have APPRAISAL policy & procedures that would include at least the following topics:

Policy Statement

" Every reasonable effort must be made to provide clients and investors accurate valuation information on each real estate holding. Part of this effort may include appraisals commissioned, performed, and booked according to a policy on appraisals."

Purpose

The purpose of the appraisal policy is to:

1. aid in determining the value of the interest(s) in properties;
2. aid in operational and strategic planning for the individual properties;
3. aid in strategic planning for the entire portfolio;

Valuation Officer

It is the duty of the valuation officer to ensure that:

1. each employee is made aware of these policies, procedures and reporting requirements;
2. the appraisal policy is implemented by the employees;
3. a valuation file is maintained for each property;

Procedures

The policy and procedures include explanations and examples on topics such as:

• Intended Use and Purpose of the Appraisal
• Internal versus External Appraisals
• Appraisal Engagements
• Appraisal Frequency
• Approved Appraisers
• Appraisal Diversification
• Appraisal Rotation
• Appraisal Standards
• Disclosure of Property Conditions
• Appraisal Adjustments
• Approval of Appraised Values

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