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APC - Taxation Allowances > Ethics > Flashcards

Ethics Flashcards

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1
Q

What is the Role of the RICS?

A

Promotes and enforces the highest professional qualifications and training

Protects consumers through regulation

Leading source of Information in the industry

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2
Q

What does the RICS Stand For?

A

The Royal Institution of Chartered Surveyors

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3
Q

What is the RICS Motto?

A

Est modus in rebus
There is measure in all things

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4
Q

Wat year was the RICS Founded?

A

1868

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5
Q

When was the RICS granted the Royal Charter?

A

1881 - Granted by the Privy Council

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6
Q

Who is the President of the RICS?

A

Justin Sullivan FRICS had to step down due to acting as an expert witness for the seller of a Notting Hill residential property.

Nicholas Maclean - Acting President

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7
Q

Who is the President Elect of the RICS?

A

Nicholas Maclean FRICS

Maureen Ehrenberg FRICS - Acting President Elect

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8
Q

Who is the CEO of the RICS?

A

Justin Young

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9
Q

How many Members of the RICS are there?

A

Circa 150,000

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10
Q

What are the levels of Membership?

A

Student
Trainee
AssocRICS
MRICS
FRICS

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11
Q

How do you become a Fellow of the RICS?

A

5+ years MRICS
Professional / technical achievement
Leadership role
Raising the profile of the RICS

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12
Q

What is the Organisational Structure of the RICS?

A

Privy Council
Governing Council (25 members)
- Regulatory Board
- Audit Committee
- Management Board

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13
Q

What is the Governance Structure of the RICS?

A

RICS is self-governed under the terms of its Royal Charter.
The Bye-Laws and Regulations are approved by the Privy Council through the Governing council.

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14
Q

What are the Regulationsof being a member of the RICS?

A
  1. Definitions
  2. Membership and Registration
  3. Designations
  4. Contribution to Funds
  5. Conduct
  6. Governing Council, Officers and Staff
  7. Subordinate Boards, Committees and Groups
  8. Procedure for General Meetings and Voting
  9. Accounts and Audit
  10. General
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15
Q

What was the Levitt Review?

A

An independent review as a result of wrongful dismissal of four RICS directors after they tried to explore the suppression of a critical internal financial report.

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16
Q

What was the Bichard Review?

A

A review of the RICS purpose, governance and strategy as called for by the Levitt Review and approved by the RICS Governing Council.

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17
Q

What were the Findings of the Bichard Review?

A

36 recommendations in total, including:
- A renewed and increased focus on the public interest
- Maintaining self-regulation
- Increased focus on Diversity and Inclusion
- Increased member engagement, with renewed focus on younger members and regional boards
- Independent review of RICS’ governance and effectiveness at delivering against its Charter for the public advantage once every five years
- A new simplified, clear, accountable governance structure
- Greater leadership on sustainability and climate change

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18
Q

What are some of the Major Challenges the RICS are currently facing?

A

Loss of institutional trust (Levitt / Bichard Review)
Rapid urbanisation
Climate change
Impact of big data and artificial intelligence

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19
Q

Why do you want to be a Member of the RICS / What are the Benefits?

A
  1. Status – client confidence
  2. Recognition – professional excellence
  3. Market advantage – competitive
  4. Knowledge – practice standards, professional guidance, CPD
  5. Network – access to professionals worldwide
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20
Q

What are the Benefits for Firms to be Regulated by the RICS

A
  1. Confidence – client confidence
  2. Professionalism – must provide impartial expert advice
  3. Security – access to free independent redress and PII cover
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21
Q

What are the 5 Rules of Conduct?

A

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

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

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

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

Members and firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in their profession.

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22
Q

What is the Ethics Decision Tree?

A

A framework of questions that should be asked when a member is being asked to act in a potentially unethical manner.
1. Do you have sufficient facts?
2. Is it legal?
3. Is it in line with RICS Rules of Conduct?
4. Have you consulted with the appropriate people to make an informed decision?
5. Do you have clear reasoning in your decision?
6. Would you be content for your actions to be made public?

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23
Q

What must you do to Set Up your own Firm?

A
  1. Inform the RICS
  2. Register for regulation
  3. PII
  4. CHP
  5. Health & Safety policy (if more than 5 employees)
  6. Procedures for handling clients’ money
  7. Set up appropriate staff training
  8. Appoint a ‘responsible principal’
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24
Q

What do you need to do to Set Up your own Firm form a Statutory Perspective?

A

Disclose business name
Inform HMRC of VAT and tax registration
Insurances (employer and public liability)
Register for data protection

Financial legislation:
- Appoint a Money Laundering Reporting Officer
- Bribery Act Compliance
- Financial Services Compliance

Employment Legislation:
- Employment Law Compliance
- Equality Act Compliance
- H&S at Work Act Compliance

Building Legislation:
- Fire Safety Order Compliance
- Asbestos register

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25
What must you do if you Close Down your Practice?
1. Inform the RICS 2. Inform clients at earliest opportunity and make handover arrangements to another firm 3. Return any clients’ money being handled 4. Inform insurers and obtain PII run-off cover for a minimum of 6 years 5. Retain copies of client files and records for 6 years minimum
26
What are International Standards?
Mandatory high-level, principle-based standards. e.g. International Property Measurement Standards (IPMS)
27
What are Professional Standards?
Professional Standards are Mandatory to follow: Currently recatagorising all Professional Statements to be Standards.
28
What is RICS Practice Information?
Practice Information is to support the practice and knowledge of surveyors: Currently recatagorising all Guidance Notes to be Practice Information.
29
What is the RICS Policy to Fee Negotiations?
Fees should be market-based and agreed on an ad-hoc basis with clients. Firms must avoid price fixing, aggressive fee cutting or collusion with competitors.
30
What must you do before you start working on an Instruction?
Check you are professionally competent. Conflict of Interest check. Have signed Terms of Engagement in place.
31
What must be included in the Terms of Engagement?
Scope of Service Fee basis Payment and calculation of expenses Complaints Handling Procedure Limit of Liability (CBRE PI insurance liability) Written Agreement from Client
32
What is a Conflict of Interest?
When and RICS member or firm's duty to act impartially is affected.
33
What are the 3 Types of Conflict of Interest?
Party Conflict: Work on the same or related instruction for 2 parties. Own Interest Conflict: relating to personal interest. Confidential Information Conflict: Relating to work between 2 parties that is confidential.
34
How would you deal with a Conflict of Interest?
Inform the Client Disclose the nature of the conflict Notify the client that impartiality may be impacted Get signed off to proceed from the client Set up an information barrier (Conflict Management)
35
What is Informed Consent?
Written consent from the client to proceed on the basis of full and transparent information regarding the conflict.
36
What are the practical implications of an Information Barrier?
Inform CBRE Compliance Office Work in different locations Restrict access to files Using different support staff
37
What does the RICS say about Confidentiality?
The RICS bye-laws state that client confidentiality must be maintained for all client affairs, including historic information (all old files must be held for a minimum of 6 years). You require permission from your client to give out any third-party information unless it is overridden by statutory requirements. Any confidential information received in error cannot be used and must be disposed of securely.
38
What is the RICS Guidance on Complaints Handling Procedures?
Stage 1 (In House): - Details of CHP should be issued. - The Complaints Handling Officer must be stated as the first person contacted. - The complaint must be made in writing. - A complaint must be acknowledged within 7 Days. - It must be investigated within 28 days. Stage 2 (ADR - Third Party Resolution): - If the complainant is not happy with the review, the second stage involving an independent redress scheme is involved. The name of the independent redress scheme must be provided to the complainant, such as: - The Centre for Dispute Resolution (CEDR) - The Property redress Scheme - RICS Dispute Resolution Service
39
What is CPD?
Continued Professional Development
40
What are the RICS Requirements for CPD?
Minimum 20 hours per year recorded online – 50% formal as a minimum
41
What is Professional Indemnity Insurance?
Mandatory for all surveyors. Protects clients, surveyors and third parties against claims for damages. Claims for damages can be made where negligence can be claimed if a duty of care was breached. Certificate for PII cover must be sent to RICS annually as part of their annual return.
42
What are the Minimum Levels of PII Cover?
Dependent on a firm’s annual turnover: - Up to £100,000 = £250,000 - £100,000 -200,000 = £500,000 - Over £200,000 = £1,000,000 For a new firm: - Estimate anticipated turnover.
43
Has there been any recent guidance from the RICS about PII?
Risk, Liability and Insurance 2021. Insurance must provide cover for fire safety claims on properties 4 storeys or above.
44
What is Negligence?
When there is a breach of duty of care owed. (resulting in a loss) Duty of care is still owed in pro bono work where there is no contract.
45
What is the Limitation Act 1980?
Imposes limits on periods for negligence. 6 years from negligent act or the date the claimant suffered the loss.
46
What procedures must be in place when handling Client's Money?
Keep it in a separate account. Offer interest on the account to the client. Provide a certificate to the RICS every 12 months with details. Keep the account in the client’s name. Keep accurate records of account. Have written consent from the client to make payments .
47
A client is about to go on holiday where he cannot be contacted. There is an interim payment due whilst he is away. He leaves you a cheque, what do you do?
Let the client know that I personally do not deal with client's money and my firm is unable to accept cheques, cash, gift vouchers etc. I would request the client sets up prior arrangements e.g. direct debit or arrange for a colleague to process the payment.
48
How are RICS Disciplinary Procedures Triggered?
Someone makes a complaint to the RICS An allegation is made by a client or third party Information is established by the RICS.
49
What are the Levels of Disciplinary Action?
1. Action by Head of Regulation 2. Regulatory Tribunal 3. Appeal panel
50
What are the Actions of the Head of Regulation if they decide Disciplinary Action is required?
1. Fixed Penalties (where firms or members fail to supply regulatory information to RICS) 2. Regulatory Compliance Order (for minor breaches) 3. CPD Sanctions (obligation to follow CPD requirement) 4. Refer to tribunal (for serious breaches of conduct)
51
What is the Definition of a Bribe?
The act of giving a gift or hospitality with the intention of gaining favour.
52
What is the Bribery Act 2010?
Key legislation regarding gifts and hospitality in business with aims to reduce bribery.
53
What are the Principles the Bribery Act is based on?
1. Proportionality 2. Top-level commitment 3. Risk assessment 4. Due Diligence 5. Communication 6. Monitoring and review
54
What are the Offences under the Bribery Act?
1. Bribery 2. Receiving a bribe 3. Bribing a foreign public official 4. Failing to prevent bribery
55
What is the Penalty for Breaching the Bribery Act?
Up to 10 years imprisonment and unlimited fines.
56
What are the RICS views on Bribery?
There is a place for hospitality and gifts in the workplace, but it needs to be proportional. The Bribery Act should be followed and if in doubt do not accept.
57
What are CBRE's rules for Gifts and Hospitality?
Gifts can be accepted if they are less than £100 in value and are not intended to sway any appointment decisions. Declare on register. Hospitality must be proportionate to the service offered and must be declared to the head of department, compliance officer and on a register.
58
What is Money Laundering?
When money from criminal activities is converted via legitimate assets.
59
What is the Key Legislation to Money laundering?
Money Laundering, Terrorist Financing and Transfer of Funds 2017
60
What are the Key Requirements of Money Laundering, Terrorist Financing and Transfrer of Funds 2017?
Have a written risk assessment Implement policies, systems and controls to address ML Provide staff training Comply with requirements relating to Politically Exposed Persons (PEPs) Keep records Anti-Money Laundering checks Additional due diligence for high-risk factors
61
What are the Different Levels of Due Diligence Checks?
Customer Due Diligence (CDD) – new clients: 1. Identify the client and verify their identity (passport) 2. Identify beneficial owners 3. Registered office for company 4. Names of the directors 5. Obtain information on nature of their relationship Enhanced Due Diligence (EDD) – additional checks for high risk third world countries or PEPs: 1. Additional evidence and monitoring required
62
What are the Typical Requirements for Money Laundering Checks?
Public Limited Company – London Stock Exchange listing Private Limited Company – Full company details, certificate of incorporation, details of owners and shareholders Public body – Government ownership Private individual – valid photo ID and validation of address
63
What is the Penalty for failure to comply with the Money Laundering Act?
Up to 14 years imprisonment for participation Up to 5 years imprisonment for failing to report suspicion.
64
What would make you suspicious of Money Laundering?
Want the deal done quickly or deal doesn’t make sense Small payments from different accounts Large payments in cash (>€10k must be registered with HMRC) Not forthcoming with information
65
What is the RICS Guidance on Money Laundering?
Countering bribery, corruption, money laundering and terrorist financing 2019
66
What does RICS Guidance on Money Laundering Set Out?
Have written policies and procedures in place. Bribery and Corruption: - Do not offer or accept anything that could constitute a bribe and comply with the law. Money Laundering and Terrorist Financing: - Do not facilitate or be complicit in ML or TF and comply with the law.
67
How do CBRE approach Money Laundering?
CBRE have an Anti-Money Laundering Officer who reviews and checks companies.
68
If you are successful in undertaking a project for a client and they send you a case of wine as a thank you, what should you do?
I would clearly state that you would consider whether this could introduce a future conflict of interest. I would refer to CBRE's gift register or other policies/procedures. The important point is to show that you would not accept a gift that may influence your future judgment.
69
As a qualified surveyor you are working for a surveying practice and a friend asks you to do a building survey as a favour because you are a surveyor, what should you do?
I would not provide advice as I do not have Professional Indemnity Insurance and would encourage them to seek advice through your company being careful that you acknowledge any conflict of interest for yourself.
70
A party walks into the office asking to speak to you, wanting to do some business with a briefcase full of cash. You sit down to discuss their requirements, and they want you to get cracking with the instruction, what do you do?
Carry out Money Laundering checks on the client in the form of Customer Due Diligence checks. If the checks come back as legitimate then I would tell them I could not accept the cash as payment.

APC - Taxation Allowances (18 decks)

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