USPAP Practice Exam 2025 – Comprehensive Test Prep

Question: 1 / 415

Which of the following is NOT considered an unacceptable fee arrangement?

Fee contingent on the assignment outcome

Fee based on the volume of total business from a particular client

Fee set by an external organization

Flat fee for services rendered

A flat fee for services rendered is considered an acceptable fee arrangement because it reflects a straightforward and transparent agreement between the appraiser and the client. Such arrangements involve a predetermined fee that is agreed upon before the appraisal work begins, allowing for clear expectations regarding payment regardless of the appraisal outcome. This minimizes potential conflicts of interest, as the appraiser is not incentivized to manipulate the value based on the fee structure, ensuring that the appraisal remains objective and impartial.

In contrast, fee arrangements that are contingent on the assignment outcome or based on other variables may introduce biases or conflicts of interest, compromising the integrity and objectivity of the appraisal process. Therefore, the flat fee arrangement stands out as an appropriate and professional choice in compliance with ethical standards in the appraisal field.

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