5 Essential Principles in the ASA Code of Ethics
There are around 300,000 in-service aircraft in the US fleet today. Valuation of each of these crafts is an important tool for anyone who owns or wants to buy a craft. Getting the right appraisal helps secure loans and sales. Appraisals are an important part of financing for the industry. It only makes sense that aircraft appraisers are held to the highest standards. One of those standards is the American Society of Appraisers’ code of ethics. The ASA Code lays out exactly how appraisers should carry out their work. Every ASA-certified member must follow these five essential principles.
1. The ASA Code Requires Confidentiality
The ASA Code of Conduct goes over how appraisers should act in every aspect of their job. This includes relationships with clients. Specifically, the code outlines the importance of confidentiality. Appraisers are to act in the best interests of their clients. Often, this means respecting the confidentiality of the appraiser-client relationship. That said, appraisers may be expected to disclose information when it’s in the best interests of a client. They may also be called upon to work with some third parties, such as law enforcement or court officials.
2. Appraisers Must Be Honest and Impartial
The ASA’s ethical and professional standards also state appraisers must be honest and impartial. Each client should be treated with the same respect. Appraisers must honestly represent their services to their clients and others. They should be able to state reasons for their valuation and present documents to support it. Appraisers should value competency over financial gain. They should not accept assignments with predetermined outcomes.
3. Professional Competency Is Fundamental
Above all, appraisers must show professional competency. They should understand the different methods of valuation. They should be able to choose and use the most appropriate method for each situation. Appraisers should also value accuracy, and they should always seek more information. They recognize that when data is limited or inaccurate, they aren’t able to perform their jobs. The appraisal could be compromised. Appraisers must also act independently. This ensures the valuation is objective.
4. Documentation Is Important
The standard of ethics also requires appraisers to maintain accurate files. These files must include transcripts, true copies of written reports, and other documentation. These files should support the appraiser’s opinion and conclusion. They must be kept for five years, and they should be available for review.
5. Proper Management of Assignments
The ASA Code defines many unethical practices. These include false advertising and undisclosed fees for procuring an assignment. All fees need to be disclosed. Appraisers also have a duty to avoid conflicts of interest. As a general rule of thumb, appraisers shouldn’t represent two clients in the same matter. They also need to remain impartial. Personal gain and connections pose problems for the appraiser. The appraiser must act with integrity and disclose potential conflicts of interest. They may need to turn down assignments where conflict of interest is observed.
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The ASA Code sets professional standards for all aircraft appraisers. If you’re looking for trustworthy information about the aircraft market, we’re here to help. Get in touch with us to start the appraisal process today.