The NPC will use the IFF lists of the owner of the NPC, and compare it with the IFF of the person talking to them. Although some did say that it wasn't working exactly or something.
Although I have not checked recently, I made a bug report about my NPC riflemen not recognizing me as an ally, but did know I was its "boss". This was a military NPC though and not a custom...
I tested this on dev, and it works fine. As with all IFF stuff, you need to have them on your list, and you on theirs. Think sensor sharing. Otherwise, if you think about it, you could switch you IFF to whatever, chat with them, then switch back. Which is not right.
So if you're using a faction IFF list that you are not on, the NPC will not know you are its ally? I assume this because the NPC will also use the faction IFF list?
EDIT: Trial and error
It does not matter what IFF list I use... I cannot add myself to my own and when I use my own list or faction this is the script:
*Cerone Evnairis eyes you suspiciously*
Excuse me Sir, what are you doing here?
Options:
You:
I have a bigger gun than you.
*I have a message for your boss.
Answer:
Sure. Drega Loas is not currently available, and is not taking any visitors, except by appointment.
Suggestions?
Edited By: Drega Loas on Year 11 Day 152 8:15 ____________
Hmm, when I spoke to my owned NPCs on dev they came up with the text as though I was an ally. Admittedly I didn't check results for when I was in a faction and was using its IFF, but using your own IFF, so long as freindly/enemy tags are reciprocated, should work fine.