valuation

reconciliation

Reconciliation is the final step in the appraisal process, in which the appraiser analyzes the value indications from the different approaches (sales comparison, cost, and income) and arrives at a single final opinion of value. The appraiser gives the most weight to the approach most relevant and reliable for the property type. It is a reasoned judgment, not a simple average.

Exam tip: Exams often include averaging as a wrong answer. Reconciliation weighs the approaches based on reliability and relevance; it is not averaging.
Example: For a single-family home, the sales comparison approach shows $410,000 and the cost approach $430,000. The appraiser gives more weight to sales data and concludes $412,000.

1. A three-way trust account reconciliation compares which three figures?

Answer & explanation

Answer: A. A three-way reconciliation ties the adjusted bank balance to the master journal and to the total of all client ledgers; all three must agree. Comparing trust funds to the operating account is not a reconciliation and suggests commingling.

Related terms & state variants

appraisal cost approach income approach sales comparison approach

Sources

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Last verified: 2026-10-23