The star rating system and scouting

If I scout a player and his potential is rated 3.5 stars, then I have him scouted again, say, a year later and he is rated 2.5 stars, how should I understand that news?

Is it that he has got worse? That the scout got it wrong the first (or second) time? Or, given that the star system is relative to your squad, is it just that my own team has improved since the first scouting, so all old scout reports are invalid?

I know either of the first two could be true, but what I don't know is whether the scouting efforts take into account the changes to my own squad over time.

It could be a bit from all three plus a fourth of the player hasn't improved since he was last scouted & being a year older the scout feels there is less chance of him improving as much as originally thought.

Scouting reports are compared to your squad on the date of the report which is visible top left.

You've covered the bulk of the reasons but they are more directly relevant to CA rather than PA. In terms of PA the main reasons would be:

A) A player is expected to improve at a certain rate up to the age of 25yo, if a player doesn't improve by that amount in a particular years then his PA will automatically be re-evaluated to a lower level than before. One example from my save would be a 20yo 1.5* CA player I bought with 4* PA. Over the next three years he only marginally improved to a 2* CA player at 23yo, his PA by then had been lowered to 2.5*. His CA didn't improve by the expected rate between 20yo & 23yo therefore the max PA my staff thought he could reach automatically fell.

B) Your squad improved overall between the scout reports.

A is the most likely, B is fairly likely and you should have some idea, anything else is possible (like a scout report being wrong) but probably less likely.

Scouting reports are compared to your squad on the date of the report which is visible top left.

Aha! That's what I thought might be the case, but I wanted to check. Thanks muchly.