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JAD RICS APC > APC Ethics > Flashcards

APC Ethics Flashcards

1
Q

What is the RICS Ethics Tree?

A

Connective framework for the ethical, professional and moral requirements of RICS membership.

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2
Q

When were the Rules of Conduct introduced?

A

Effective from 2/2/22

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3
Q

What is the 1st Rule of Conduct?

A

Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.

KEYWORDS: honest, integrity, professional obligations.

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4
Q

What does the 1st Rule of Conduct cover?

A

Consumer Protection from Unfair Trading Regulations 2008.

Misrepresentation Act 1967

UK Commercial real estate agency (PS, 1st edn, 2016)

Bribery Act 2010

Money Laundering and Terrorist Financing (Amendment) Regulations 2019

Countering bribery and corruption, money laundering and terrorist financing (1st edn, 2019)

Conflicts of interest (1st edn, effective 2018)

Client money handling (1st edn, effective 2020)

Client Money Protection scheme

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5
Q

What is the 2nd Rule of Conduct?

A

Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise.

KEYWORDS: professional competence, competent individuals, expertise.

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6
Q

What does the 2nd Rule of Conduct cover?

A

CPD, both formal and informal.

Good supplier management

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7
Q

What is the 3rd Rule of Conduct?

A

Members and firms must provide good-quality and diligent service.

KEYWORDS: good-quality, diligent service.

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8
Q

What does the 3rd Rule of Conduct cover?

A

Objectives and KPIs
ToE
ISO9001
Data Protection Act 2018
- GDPR

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9
Q

What is the 4th Rule of Conduct?

A

Members and firms must treat others with respect and encourage diversity and inclusion

KEYWORDS: respect, diversity, inclusion.

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10
Q

What does the 4th Rule of Conduct cover?

A

Equality Act 2010
Modern Slavery
Unconscious Bias

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11
Q

What is the 5th Rule of Conduct?

A

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.

KEYWORDS: public interest, prevent harm, public confidence.

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12
Q

What does the 5th Rule of Conduct cover?

A

Complaints Handling (1st edn, 2016)

Centre for Effective Dispute Resolution (CEDR) - independent body

ADR

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13
Q

What are the 6 ethical principles?

A

Honesty, integrity, competence, service, respect, responsibility.

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14
Q

What are the minimum levels of PII?

A

Based on turnover in preceding year.

under £100,001 = £250k
£100,001 - £200,000 = £500k
£200,000 + = £1mil

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15
Q

What is the maximum excess of PII policies?

A

Under £10mil - greater of £10k or 2.5% insured sum

Over £10mil - unlimited

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16
Q

What’s run-off insurance?

A

Covers historic claims once a business is dissolved.

Need for up to 6 years.

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17
Q

What is PII?

A

Professional Indemnity Insurance.

Commercial policy designed to protect against claims of inadequate service.

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18
Q

What is the key PII case law?

A

Merrett v Babb 2001

Made surveyors, acting on behalf of their employer, personally liable for damages.

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19
Q

What is the key case law for records and clear ToE?

A

Hart v Large 2011

Importance of compliance and competence.

Need to retain detailed reports and docs for up to 15 years after the fact.

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20
Q

What are the four key offenses of the Bribery Act 2010?

A
  1. Bribing another person.
  2. Accepting a bribe.
  3. Bribing an FPO.
  4. Failure to prevent a bribe.
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21
Q

What is a Principle Offence under the Bribery Act 2010?

A

Offering, promising, or giving an advantage to another person so that they will perform a relevant function improperly.

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22
Q

What are the 6 prevention principles of the Bribery Act?

A

Proportionality
Top-Level Commitment
Risk Assessment
Due Diligence
Communication
Monitoring

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23
Q

What are the three key checks to mitigate risk in an instruction?

A

Check competence
Interest conflicts
Terms to be clear and confirmed

CIT

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24
Q

What is an RICS annual return?

A

?

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25
Q

Explain the ARP.

A

Assigned Risks Pool

To ensure the availability of PII the RICS has a market facility, the Assigned Risks Pool.

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26
Q

Explain the principles of better regulation.

A

PACTT

proportionate, accountable, consistent, transparent and targeted

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27
Q

Who is the current President of RICS?

A

Ann Gray
January 2023

28
Q

Who is the current President Elect of RICS?

A

Tina Paillet
January 2023

29
Q

Who was the first President of RICS?

A

John Clutton
1868

30
Q

Who is the CEO of RICS?

A

Richard Collins
2021

31
Q

What is a Royal Charter?

A

An instrument of incorporation, granted by The King, to confer independent legal personality on an organisation and powers to govern its own affairs.

32
Q

When did RICS receive its Royal Charter?

A

1881

33
Q

What is a bye-law?

A

A rule by which an organisation can self-govern and control the actions of its members.

34
Q

Give an example of an RICS bye-law.

A

Bye-law 3 - the right for members and firms to use official designations, but not to use any designation not from the RICS which may be confused as such.

35
Q

What types of Regulatory decision-making are available to the RICS?

A

Referral to Head of Regulation
Regulatory Tribunal (can be single member or 3)
Disciplinary Panel (3, 2 or which are not members)

36
Q

What sanctions are possible from a disciplinary process hearing?

A

fixed penalty fines
Regulatory Compliance Orders (Consent Orders)
Disbarment
Publication of decision in local media

37
Q

What are the RICS Requirements for PII?

A

Must be on an each and every claim basis
Align with minimum indemnity levels
Must be fully retroactive
Align with maximum excess levels
Run-off cover must be in place
Should cover past and present employees

38
Q

What is the RICS Futures Report (2020)?

A

In 2015 the RICS highlighted key industry challenges such as:
urbanisation
the disruption of big data
the climate crisis

2020 findings were:
- 95% data is wasted
- mega-cities and fast urban development are
challenging our environment
- drone technology needs further monitoring

39
Q

What is the Levitt Report (2021)?

A

Commissioned in 2018 following Treasury Audit which returned a ‘no assurance verdict’.

Concluded there was a power struggle between the two boards (Management and Executive).

Recommendations:
- Governing Council to have more insight
- GC to be briefed by Management Board not
CEO.
- GC to oversee bonuses.
- Greater transparency required.

40
Q

What are some of the aims highlighted in the RICS Business Plan for 2021-2022?

A

Incorporate Levitt Report recommendations
- be more open and transparent
- create better whistleblowing policies
- review exec awards.
Financial priorities
- payback covid furlough monies via surplus
- reduce need for external financial support
- reduce funding deficit in Pension Scheme.

41
Q

Why did the Rules of Conduct change?

A

Previous rules in place since 2007.

Followed consultation with Members and Firms.

Combined Rules of Conduct and Global Professional and Ethical Standards.

Greater focus on example behaviours and climate change.

42
Q

What do the Rules of Conduct amalgamate?

A

Rules of Conduct for Members
Rules of Conduct for Firms
Global Professional and Ethical Standards

Appendix A now contains professional obligations.

43
Q

What are the professional obligations for Members?

A

Comply with CPD requirements

Cooperate with the RICS

Provide information requested by the Standards and Regulations Board.

44
Q

What are the professional obligations for Firms?

A

Publish CHP
Have adequate PII cover
Sole princips must make cover arrangements
Cooperate with the RICS
Provide info requested by S&R Board
Display RICS Designations correctly
Report as required under Rules for Reg Firms

45
Q

What are the Rules for the Registration of Firms?

A

Version 7, Feb 2022

Must register:
<50% members,
provide services to the public, and
in the UK.

Eligible to register:
<25% members, provides services to the public.

Can also be considered if providing public services and either confirmed compliant or supported by another RICS Registered Firm.

46
Q

Key challenges provided by the Global Economic Recession?

A

Rising inflation and construction costs increasing development budgets (10-11%).

Rising inflation has caused a net reduction of fee income in real terms as older approved levels are maintained.

47
Q

What impacts has the Ukraine conflict had on your sector?

A

Increase in costs and availability of raw materials (steel, concrete etc.) has affected profitability of full ADC packages.

48
Q

What impacts has Brexit had on your sector?

A

Restricted movement of people has lessened workforce in the construction sector significantly.

Increase in cost and availability of materials, compounded by Ukraine conflict.

49
Q

What impacts has Brexit had on your sector?

A

Restricted movement of people has lessened workforce in the construction sector significantly.

Increase in cost and availability of materials, compounded by Ukraine conflict.

50
Q

Has the RICS commented on Brexit?

A

RICS has issued a number of position statements highlighting concerns and issues on a sector-by-sector basis.
- loss of diversity of the workforce
- loss of income streams via EU funding

51
Q

Discuss COP27.

A

Sharm El Sheikh

Highlighted countries affected by loss and damage of extreme weather.

Loss and damage fund agreed at $100bn per year.

Peak of carbon emissions to be before 2025.

Phasedown of fossil fuels not agreed, this was seen as a failure by many.

52
Q

What have been recent changes to MEES?

A

Minimum Energy Efficiency Standards

Changes to commercial property requirements due to take effect in 2025.

Domestic rental limit currently E, to rise to C from 2025.

53
Q

What is ICMS3?

A

International Cost Management Standard 3 relates to presenting life cycle and carbon emission costs for developments.

54
Q

Steps of the ethics decision tree?

A

Know the facts
Is it legal
Does it comply with the rules of conduct
Have you consulted appropriate people
Do you have clear reasoning
Is the decision informed?
Press test

55
Q

Minimum MEES levels?

A

E rating or above for commercial properties to be let legally.

56
Q

Date and intent of the Bichard Review?

A

2022, modernise and diversify the RICS

57
Q

What’s the RICS governance structure?

A

Privy Council
Governing Council
Standards & Regs Board or Mgment Board
Committees

58
Q

New categories of document?

A

Professional Standards, and practice information

59
Q

What would you do under client due diligence?

A

ID checks and confirm whether high risk in relation to corruption (i.e. registered in an unsafe area or unclear banking arrangements).

Check reputation would not impact on firm or other clients.

Quick financial check on Companies House or similar to confirm solvent and any contact details.

Use framework such as Know Your Client or CDD documents to confirm data.
- EDD can but used if a person or company is known to be high risk.

60
Q

RICS Documents for Client Money Information?

A

Client Money Handling and Client Money Protections 2019

61
Q

RICS document for Conflicts of Interest?

A

PS Conflicts of Interest 2017

62
Q

types of conflict identified in Conflicts of Interest 2017?

A

party conflict, own person conflict, confidentiality conflict.

Informed consent also covered - acknowledgement by instructing party that a conflict exists but they accept it and any resultant issues in the person continuing to act for them.

Information barriers can reduce a confid. COI but aren’t watertight.

63
Q

Process of setting up a firm

A

confirm mechanism (sole princip, directors)

confirm business name and register

seek insurance cover (PII, public and employers liab, buildings and contents, interruption)

set up required client and business bank accounts

Register with RICS is required / desired and assign responsible principle.

Publish CHP and make CPD available to any employees.

64
Q

Process of winding up a firm.

A

Notify insurers and put run-off cover in place

set closure date

notify clients and handle handover / return of monies and documents correctly.

safely store records for required period

notify staff

notify RICS and apply to deregister

65
Q

CS CHP

A

stage one - confirmation of receipt within 2 working days. Aim to resolve within 15 working days. Update each 5wd until resolved.

Stage 2 - escalation to HOP , response within further 15 working days.

JAD RICS APC (12 decks)

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