Since the 1989 passage of the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) virtually all professional real property appraisers have come under regulation by the federal and state governments. All appraisers of real property, and interests in real property, have been required to become licensed or certified under criteria established by the Appraiser Qualifications Board of the Appraisal Foundation. The Appraisal Standards Board of the Appraisal Foundation develops, publishes, interprets, and amends the Uniform Standards of Professional Appraisal Practice (USPAP) on behalf of appraisers and users of appraisal services. The USPAP makes a clear distinction between appraisal services and consulting activities that can have a bearing on engaging the services of a professional mineral property appraiser. The USPAP considers three forms of appraiser engagement by a client: appraisal, review, and consulting.

Differentiation among these three activities depends upon the purpose and intended use of the results. Appraisal is defined in the USPAP as the act or process of estimating value, or an opinion of value. Appraisals are performed where the appraiser is retained by a client to act, or would be perceived by third parties or the public, as an independent, impartial, or disinterested person that is reporting an unbiased estimate or opinion of value that responds to the client's stated objective. Review is the act or process of critically studying an appraisal report prepared by another appraiser. Consulting is defined as the act or process of providing a client with information, analysis of data, and recommendations or conclusions on diversified mineral property and mining business problems other than an estimate of value. The USPAP also recognizes two kinds of consulting activities: impartial and advocacy. In an impartial consulting service the appraiser serves as a disinterested third party that responds to the client's stated objective. An advocacy consulting service occurs when the appraiser serves in a capacity that is intended to facilitate the achievement of the client's objective.

Some of the specific activities that are normally associated with mineral property appraisal and mining business valuation include:

USPAP identifies four defined activities as consulting: Cash Flow Analysis; Feasibility Analysis; Investment Analysis, and; Market Analysis. Because USPAP defines any activity other than an estimate of value as consulting, some of the commonly performed mineral property or mining business consulting services are:

Discuss your mineral property appraisal or mining business valuation concerns with
Mineral Business Appraisal, Michael R. Cartwright  michael@minval.com
Five Claret Court, Reno, NV  89512-4744
Tel/Fax: 775-322-9028

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