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My APC > Ethics > Flashcards

Ethics Flashcards

1
Q

Say you pass today, what would you need to setup your own firm?

A
  • Adhere to rules for registration V8 effective 2nd February 2022
  • Inform the RICS of your practice by filling out a Firm Detail Form including the services provided, to the Regulatory Board
  • Agree to share relevant information the RICS requires and appoint a Responsible Principal, to be approved by the Regulatory Board (doesn’t have to be chartered but must demonstrate experience and knowledge of compliance)
  • Arrange Professional Indemnity Insurance and supply details
  • Set up handling clients money policy in line with Clients Money Handling 1st Edition October 2019
  • Set up a complaints handling procedure in line with Complaints Handling 1st Edition July 2016
  • Plan for succession if a Sole Practitioner
  • Ensure CPD requirements for yourself and staff
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2
Q

Tell me 5 insurances you need as a firm

A
  • Professional indemnity insurance
  • Car insurance
  • Business insurance
  • Buildings insurance
  • Public liability insurance
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3
Q

What are the levels of PII cover?

A
  • Linked to the turnover of the Firm
  • £100k or less = £250k cover
  • £100k-£200k = £500k cover
  • £200k+ = £1m cover
  • Up to £500k = excess of 2.5% of the sum insured or £10k
  • Over £500k = 2.5% of the sum insured
  • Details need to be submitted to the Regulatory Board every year as part of the annual return
  • Claims can be made up to 15 years after the work
  • Run off cover required for 6 years after cessation of trading
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4
Q

What are the Rules of Conduct?

A

Global Rules of Conduct for members and firms, published in October 2021 and effective 2nd February 2022

  1. Members and Firms must be honest, act with integrity and comply with their professional obligations, including obligations to the RICS
  2. Members and Firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise
  3. Members and Firms must provide good-quality and diligent service
  4. Members and Firms must treat others with respect and encourage diversity and inclusion
  5. Members and Firms must act in the public interest, take responsibility for their actions and to act to prevent harm and maintain public confidence in the profession
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5
Q

What are the Professional Obligations to RICS for Members?

A

Specific section of the Rules of Conduct February 2022 which relates to members only

  1. Members must comply with the CPD requirements set by the RICS
  2. Members must cooperate with the RICS
  3. Members must promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf
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6
Q

What are the Mandatory Obligations for RICS Regulated Firms?

A

Specific sections of the Rules of Conduct February 2022 relating to RICS regulated firms

  1. Firms must publish a complaints handling procedure, which includes an alternative dispute resolution provider approved by the RICS and maintain a complaints log
  2. Firms must ensure that all previous and current professional work is covered by adequate and appropriate professional indemnity insurance cover that meets the standards approved by the RICS
  3. Firms with a sole principal must take appropriate arrangements for their professional work to continue in the event of their incapacity, death, absence from or inability to work
  4. Firms must cooperate with the RICS
  5. Firms must promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf
  6. Firms must display on their business literature, in accordance with RICS’ published policy on designations, a designation to denote they are regulated by the RICS
  7. Firms must report to RICS any matter they are required to report under the Rules for the Registration of Firms
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7
Q

What are firms required to report under the Rules for the Registration of Firms?

A
  • Any finding against it by a disciplinary or regulatory body, court or statutory authority
  • Any claim for insolvency
  • If there is a material change to the firm, provide details within 7 days
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8
Q

Why do you want to be a Chartered Surveyor?

A
  • Professional recognition of excellence
  • Access to guidance provided by the RICS
  • Joining a well-established and recognised institution
  • Access to a network of surveyors
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9
Q

Who is the current President of the RICS?

A

Clement Lau

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10
Q

What’s the RICS charity?

A
  • Lion Heart
  • It helps surveyors with stress, financial difficulties, mental health difficulties, bereavement and includes their families
  • Automatically enrolled by being part of the RICS, automatically included when registered as an RICS candidate
  • John O’Holloran mental health initiative set up in 2016, who committed suicide in 2015
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11
Q

What is the role of the RICS?

A
  • To maintain the highest standards of education and training
  • To protect consumers through regulation and professional standards which members and professionals must adhere to
  • To be the leading source of information for land, property, construction and associated built environment issues
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12
Q

What’s a bylaw?

A
  • A rule or law of the governance of a self governing body or authority
  • Applications need to be made to the Privy Council to alter bylaws
  • Last updated in February 2020
  • Examples include:
    • Rule 3 - professional conduct
    • Rule 6 - CPD
    • Rule 8 - Protecting clients money
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13
Q

When was the RICS founded?

A
  • 1868
  • Received Royal Charter in 1881
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14
Q

What are the levels of membership?

A
  • FRICS - Fellow
  • MRICS - Member
  • AssocRICS - Associate
  • Trainee-Student
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15
Q

Are there any changes to the Rules of of Conduct you should be aware of?

A
  • A new Rules of Conduct for Members and Firms was released in October 2021, taking effect from 2nd February 2022
  • They follow the same principles of the previous RoC for Members and Firms and the Global and Professional Ethical Standards
  • They are combined into 5 principles for both members and firms to follow, making it easier for members and firms to adhere to
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16
Q

Can you tell me what the new Rules of Conduct for Members and Firms are?

A
  1. Members and Firms must be honest, act with integrity and comply with their professional obligations, including obligations to the RICS
  2. Members and Firms must maintain professional competence and ensure that services are provided by competent individuals who have the necessary expertise
  3. Members and Firms must provide good quality and diligent service
  4. Members and Firms must treat others with respect and encourage diversity and inclusion
  5. Members and Firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession
17
Q

Can you tell me when you demonstrated any of the 5 Rules of Conduct in practice?

A
  1. Members and Firms must be honest, act with integrity and comply with their professional obligations, including obligations to the RICS
    1. I achieve my KPI’s of reducing the rental roll for the business by targeting properties which are over rented. I comply with the CPD policy the RICS expects
  2. Members and Firms must maintain professional competence and ensure that services are provided by competent individuals who have the necessary expertise
    1. I undertake regular CPD to keep my knowledge up to date, I recently attended a CPD seminar on the post-pandemic property market outlook
  3. Members and Firms must provide good quality and diligent service
    1. I ensure all of my deals are documented in a way which is logical to the client including providing my recommendations on rental value, terms agreed and recommendations on how to proceed
  4. Members and Firms must treat others with respect and encourage diversity and inclusion
    1. I ensure that I always treat all persons with respect, even if a negotiation is challenging. I was being sworn at by a Landlord at Woking and I ensured I stayed courteous and respectful to them even when the Landlord was disrespectful to me
  5. Members and Firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession
    1. I have the means within my organisation to raise concerns on issues which I face in my work. I make recommendations to processes to protect the business and recommendations regarding shop lease terms and rents e.g. Guildford
18
Q

Why do you think an Ethics module is a regular CPD requirement?

A
  • It ensures professionals are aware of the ethical standards expected of them
  • It benchmarks the RICS as a considerate organisation which promotes best practice at the highest level
  • By evolving the ethical expectations of surveyors, it ensures the relevance of the RICS in the public eye and ensures the RICS moves forward when expected
  • Ethics set fellows, members and APC candidates a part from non-chartered surveyors
19
Q

What are the CPD requirements?

A
  • Fellows and Members - 20 hours a year with at least 50% formal
  • APC candidates 48 hours per year with a minimum of 96 hours over the 24 month period prior to submission
20
Q

Can you tell me what happened at Pinner?

A
  • A Landlord called to express extreme frustration at the time taken to pay the dilapidations settlement successfully negotiated
  • I explained the process of the payment to him and listened to his frustrations
  • Despite numerous expletives used against me and rude remarked, I remained professional and courteous and made assurances the payment would be made in a timely manner
21
Q

Can you tell me what happened at Meanwood and how you displayed competence?

A
  • The client has a policy of maintaining the rent of shops at passing or below
  • I recommended a £500 a year uplift, which went against this policy
  • By displaying an increased tone based on market transactions and securing a 3rd year break, I explained the benefits of the deal to my client and my recommendation to proceed
  • This was approved based on my recommendations as it met the shops trading requirements as this was a marginal shop
22
Q

Can you tell me the different types of conflicts of interest?

A
  • Contained in RICS Conflicts of Interest, Professional Statement, 1st edn, March 2017
  • A conflict of interest is when a party’s impartiality is compromised
  • A party conflict - working on the same instruction for 2 different parties
  • An own interest conflict
  • A confidential information conflict - work between 2 parties which is confidential
23
Q

If there was a conflict of interest, how would you proceed?

A
  • Depends on the nature of the conflict
  • Either:
    • Avoid the conflict and decline instruction
    • Informed consent setting out:
      • The nature of the conflict
      • Set out ethical barriers
      • How your firm intends to deal with information such as an information barrier
      • Ensure both parties are in agreement, set out in writing
    • Manage the conflict if informed consent is given:
      • Set up an information which is robust and cannot allow information to pass between the parties
      • Set up steps to operate the barrier
      • Surveyors must be physically separated
      • Securely store all information
      • Keep an audit trail
24
Q

Can you tell me about the tickets you were offered for an England game?

A
  • The work the suppliers provided to my team was relatively minor
  • I felt the tickets were inappropriate for the level of work given to the supplier
  • I politely turned them down
  • I was concerned on how the gift would be perceived by my client and felt the tickets were an effort to entice our business to provide more instructions to the supplier
25
Q

Can you tell me what happened at Whitechapel and why the “premium” was a concern?

A
  • Under the alienation clause a premium was prohibited
  • A premium can be viewed as a source of money laundering to clean money
  • When pushed on to the agent, the party abruptly ended the conversation
26
Q

Can you tell me how you would set up a compliant complaints handling procedure?

A
  • Key guidance is Compliance Handling Guidance Note, 1st edition, 2016
  • All staff must be aware of how to identify a complaint
  • A copy of the complaints handling procedure should be issued with the Terms of Engagement and also available upon request
  • When a complaint is received, it must be logged in the Complaints Log
  • Advise the client of the registration of the complaint, which must be in writing
  • A firm must appoint a Complaints Handling Officer to deal with all complaints
  • These must be acknowledged within 7 days of registration by the Complaints Handling Officer
  • Within 21 days, the CHO will write to the client to discuss the outcome of the complaint
  • If the client is still unhappy, the CHP must contain and ADR, for sole practitioners, the Complaints Handling Officer must be based at another Firm
  • If the complaint is for negligence, alert your PII Insurance
27
Q

What are the RICS’ requirements for PII Insurance?

A
  • RICS guidance is Professional Indemnity Insurance Requirements, V5, July 2019
  • Each member and firm requires PII insurance
  • The level of cover is linked to the turnover of the company
  • Chartered firms must show their PII as part of their annual return
  • The cover must cover past and present employees
  • Ensure run-off cover for Firms which have ceased trading
    • The RICS recommends 6 years run-off cover with a minimum limited of £1m
28
Q

Can you tell me how you would go about setting an appropriate fee basis?

A
  • These would be contained in the Terms of Engagement
  • The fee basis must be appropriate to the work being undertaken to the client
  • The fee basis must be within market expectations and heavy fee reduction is against the ethical expectation for firms
  • Fees can also be negotiated but must be appropriate to the amount of work required to justify the fee
29
Q

Can you tell me how you would establish a scope of service?

A
  • The scope of service is what is being delivered to the client by the firm
  • The level of service needs to be appropriate to the fee level
  • The firm must have the relevant expertise to carry out the services promised to the client
  • If a service is promised to the client which the firm cannot deliver due to lack of expertise, this can open up a firm to a claim for negligence and is inappropriate
30
Q

Can you tell me how you would establish KPI’s

A
  • KPI’s for a client should be appropriate to the client’s expectation
  • For example:
    • If L&T work is being carried out, a possible KPI may be rent saving, number of transactions completed, keeping a stable rent roll, ensuring maximum flexibility of lease term
    • KPI’s may be benchmarked against fee, for example an additional fee for percentage of rent saving or number of transactions
30
Q

Can you tell me how you would establish KPI’s

A
  • KPI’s for a client should be appropriate to the client’s expectation
  • For example:
    • If L&T work is being carried out, a possible KPI may be rent saving, number of transactions completed, keeping a stable rent roll, ensuring maximum flexibility of lease term
    • KPI’s may be benchmarked against fee, for example an additional fee for percentage of rent saving or number of transactions
31
Q

Can you tell me about the Conflict Avoidance guidance you’ve read?

A
  • It is a Guidance Note, 1st edition published in 2012
  • Key themes include identifying key indicators of conflict avoidance and dispute resolution
  • Surveyors should proactively manage their duties
  • Have clear contract documentation
  • Have good client management
  • Good payment practice
  • Keep good records
  • There are different forms of dispute resolution including:
    • Negotiation
    • Mediation or conciliation
    • An adjudicative process
  • Examples of dispute resolution include:
    • Arbitration
    • Expert determination
    • Litigation
    • Mediation
32
Q

Who is the current Chief Executive?

A
  • Richard Collins
33
Q

Why do you think there has been a new Rules of Conduct released?

A
  • It is important to constantly review ethical practice to meet the needs of today, for example the inclusion of promoting diversity
  • Following the Levitt Review, it was important for the RICS to reassess its ethical principles for all surveyors to adhere to, to renew trust in the public
  • It simplifies the rules of conduct for surveyors and firms rather than having separate rules of conduct for firms and members as well as the global ethical standards
34
Q

Can you tell me the different types of RICS material?

A
  • International standards - Mandatory
  • Professional Statements - Mandatory
  • Practice Statements - Mandatory
  • Guidance Notes - Voluntary but recommended for best practice
  • Code of Practice - Voluntary but recommended for best practice
35
Q

Can you tell me the three levels of disciplinary actions.

A
  • Action by Head of Regulation
    • Consent order - provide information to the RICS
    • Fixed penalty - remedy the action
    • CPD sanction
    • Refer to the disciplinary panel
  • Disciplinary panel
    • Issue a consent order
    • Unlimited fine per breach
    • Conditions on future RICS registration
    • Expulsion
  • Appeal panel
    • The panel will consider the sanctions imposed by the Head of Regulation and Disciplinary Panel
    • 50% of the panel of lay members
  • The most common breaches are:
    • Rule 3 - professional conduct
    • Rule 6 - CPD
    • Rule 8 - Protecting clients money
36
Q

Can you tell me about the relevant Bribery Legislation?

A
  • The Bribery Act 2010
  • Four offences:
    • Receiving a bribe
    • Giving a bribe
    • Bribing a public official
    • Failing to prevent bribery
  • Penalities are policed by the Serious Fraud Office
    • Max 10 year prison sentence and/or unlimited fine. Companies face unlimited fine
37
Q

Can you tell me about an story you read in the latest Modus magazine?

A
  • What is the real value of property in the Metaverse?
  • The story explored the possibility of real estate values in the meta verse and how this could pave the way for transactions in the future
  • It is unclear how the value of virtual assets will derive and whether it will actually take off in such a way to create viable investment values
  • The meta verse is in its infancy but Google, Microsoft and Facebook (Meta) are investing billions in its development
38
Q

Can you tell me about an RICS initiative agreed recently to promote inclusion?

A
  • The memorandum of understanding was signed by the RICS in April
  • This increases collaboration and understanding across the industry, and promotes discussions on topics such as inclusion
  • The RICS launched women’s history month for International Women’s Day, with a number of conferences set up to discuss women’s contribution to the built environment

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