module 04 | professional development + practices

Question 1

what is negligence liability?

Answer 1

the designer has failed to use due care as expected of a professional in carrying out their design responsibilities

also referred to as professional negligence

Question 2

what is breach-of-contract liability?

Answer 2

the failure to complete the requirements of a contract

Question 3

what is strict liability?

Answer 3

one’s full responsibility for their actions

Question 4

if a designer is looking to hang a large mirror on a wall of an old building, what conditions is the designer responsible for documenting?

Answer 4

• existing wall condition
• size + weight of the mirror
• special mounting requirements

Question 5

how does errors + omissions insurance protect the designer? (also known as professional liability insurance or malpractice insurance)

Answer 5

the designer is protected if there is any personal or financial harm from an act, error, or omission due to the designer’s services

Question 6

in the case of a large mirror being hung from an old wall, what type of insurance would protect the designer if the product failed to perform as intended?

Answer 6

product liability insurance

Question 7

on the idfx exam, when deciding between two answers dealing with code, what is a good rule of thumb?

Answer 7

choose the answer that is better for life safety

Question 8

what are the two main types of regulation of the interior design profession, in regards to job titles?

Answer 8

• practice acts
• title acts

Question 9

what is a practice act?

Answer 9

practice acts establish what an individual can or cannot do in practice as a licensed professional

Question 10

what type of regulation defines who can use a professional title while also restricting who can perform certain professional acts?

Answer 10

practice act

Question 11

what is a title act?

Answer 11

a title act limits who can use professional titles - allowing those who have completed education + exams to use a modified title

Question 12

what is the benefit of having a modified title?

Answer 12

a modified title shows a client that the designer has recognized qualifications

Question 13

which type of regulation forbids a person from using a title like “architect” or “engineer” without being properly licensed?

Answer 13

a practice act

Question 14

what type of business structure is started, owned, an operated by a single individual?

Answer 14

a sole proprietorship

Question 15

in a sole proprietorship, who holds responsibility for legal + financial liabilities of the business?

Answer 15

the owner

Question 16

what are the three types of business partnerships?

Answer 16

1. general partnership
2. limited partnership
3. limited liability partnership (llp)

Question 17

in a limited partnership, how much is each partner liable for?

Answer 17

each partner is only liable up to the amount of their investment

Question 18

which of the following is a separate legal entity:

• limited liability company
• corporation
• sole proprietorship

Answer 18

corporation

Question 19

what is a balance sheet?

Answer 19

a form that shows the firm’s financial position at a particular moment in time

Question 20

what is an income statement?

Answer 20

a report that displays all the revenues and expenses of a firm for a stated period of time

Question 21

what is the result of creating an income statement?

Answer 21

the result shows the net income

Question 22

how does net profit differ from gross profit?

Answer 22

gross profit is revenue minus the cost of goods sold

net profit is revenue minus all operating expenses, taxes, and interest

Question 23

what is the term for the amount of money coming into a firm from selling goods or rendering services during an accounting period?

Answer 23

revenue

Question 24

what three types of claims does general liability insurance cover?

Answer 24

1. property damage
2. liability
3. personal injury

Question 25

what three parties does general liability insurance cover?

Answer 25

1. employees 2. consultants 3. others hired by the designer

Question 26

what type of insurance protects the designer's building from disasters like floods, fire, and theft?

Answer 26

property insurance

Question 27

what is a tort?

Answer 27

a civil wrong that causes injury

Question 28

what is the best way to minimize exposure to liability?

Answer 28

through contracts and insurance documentation

Question 29

what is the term for the act of suing for something outside of the designer's job / scope?

Answer 29

third party claim

Question 30

what is an rfp?

Answer 30

request for proposal

Question 31

what does an rfp entail?

Answer 31

a document created by the client that contains key information the client seeks from an interested design firm

Question 32

what pieces of information are included in an rfp?

Answer 32

- full scope of requested services - project description - proposal requirements - submission due date

Question 33

how does an rfp differ from an rfq?

Answer 33

an rfq displays a firms capabilities + experience whereas an rfp details how a firm would tackle the project

Question 34

if additional services are not outlined in a secondary contract, how are they charged to the client?

Answer 34

additional services should be billed hourly with an identified rate schedule

Question 35

what do exclusions within a contract verify?

Answer 35

exclusions clarify what the designer is not legally liable for

Question 36

what is a performance bond?

Answer 36

a statement by an insurance company that ensures project completion, should the contractor default on their obligations

Question 37

what is a labor + materials performance bond?

Answer 37

a promised payment to labor and for materials should the contractor default

Question 38

what does a labor + materials performance bond protect the owner from?

Answer 38

it protects the owner from the lien (the right of a subcontractor to keep property held by the owner until a debt has been paid)

Question 39

within aia standard agreements, a-series are agreements between which parties?

Answer 39

the owner and the contractor / vendor

Question 40

within aia standard agreements, b-series are agreements between which parties?

Answer 40

the owner and the architect / designer

Question 41

what do b-series agreements outline?

Answer 41

- scope of work + schedule - cost for the work - all fees

Question 42

what is a lien

Answer 42

the right of a subcontractor to keep / possess property of the owner until a debt is paid

Question 43

what is the role of osha for a worker?

Answer 43

osha strives to assure safe + healthy working conditions by setting and enforcing standards

Question 44

what does osha provide to the workforce / employers?

Answer 44

- training - outreach - education - assistance

Question 45

what is the purpose of the fair housing act (fha)?

Answer 45

the fha makes discrimination in the sale, renting, and financing of a home based on race, gender, disability, etc illegal

Question 46

true or false: the ada is a civil rights law.

Answer 46

true

Question 47

what is the purpose of the americans with disabilities act (ada)?

Answer 47

to ensure people with disabilities have equal opportunities in various aspects of life

Question 48

which three entities set ethics standards?

Answer 48

1. cidq 2. local jurisdiction 3. professional organizations

Question 49

true or false: the individual against whom an ethics complaint is made must be a member of one of the professional associations.

Answer 49

true a client cannot expect an association to discipline someone who is not a member

Question 50

what is price discrimination?

Answer 50

the act of charging different prices for the same goods

Question 51

who does price discrimination affect?

Answer 51

only sales between merchants

Question 52

what is the main purpose of interior design professional associations?

Answer 52

they provide tangible and intangible business benefits

Question 53

CEUs need to focus on "health, safety, and welfare." what components make up hsw? - codes, standards, and materials - ethics, psychological well-being, and materials - codes, ethics, and psychological well-being - materials, ethics, and standards

Answer 53

codes, ethics, and psychological well-being

Question 54

are codes of ethics considered standards of law?

Answer 54

no, ethical standards are a higher standard than the law

Question 55

in some states an interior designer is required to have a license to practice design. this requirement is based on a state's...? - state regulatory requirements - practice act - exclusionary legislation - title act

Answer 55

practice act

Question 56

which of the following is not a true statement about specs? - specs are a legal document - specs to not include standards that cannot be measured - specs specify the results and methods of construction / fabrication - specs should avoid exculpatory clauses that try to shift the responsibility to the contractor or someone else in a broad, general way

Answer 56

specs specify the results and methods of construction / fabrication

Question 57

which is more stringent a practice act or a title act?

Answer 57

practice act

Question 58

why is a practice act more stringent than a title act?

Answer 58

a practice act limits the activities an individual can perform practice acts prohibits individuals from engaging in certain activities until the person meets qualifications established by a state board / become licensed

Question 59

what is it mean to act with fiduciary responsibility?

Answer 59

to act in the best interest of another person / entity

Question 60

what factor sets a limited partnership apart from a general partnership?

Answer 60

a limited partnership contains investment from a party outside of the working partners

Question 61

how is a hedge fund an example of a limited partnership?

Answer 61

a hedge fund functions with a general partner that manages a portfolio of investments; the limited partners are those that provide capital limited partners do not have participate in business operations

Question 62

why are limited liability partnerships popular among professional service firms? (i.e. architecture firms or law firms)

Answer 62

limited liability partnerships are popular because they allow partners to share profits while limiting personal risk exposure

Question 63

what type of businesses use a limited liability partnership model?

Answer 63

- law firms - architecture firms - medical practices - financial advising businesses

Question 64

a limited liability company (llc) is a hybrid of which two business models?

Answer 64

1. general partnerships / sole proprietorships 2. corporations

Question 65

what is another name for the owner of an llc?

Answer 65

a member

Question 66

what must the legal name of a limited liability company include?

Answer 66

the words "limited liability company" or the initials "llc" or "lc"

Question 67

what is the most time-consuming and expensive method of forming a business?

Answer 67

forming a corporation

Question 68

what is a corporation?

Answer 68

an association of individuals created according to a statutory law

Question 69

what is the term for a member of a corporation?

Answer 69

stockholder or shareholder

Question 70

what are two reasons why a corporation being a legal entity is a good idea?

Answer 70

1. corporations allow for originators to be independent of the organization 2. corporations allow for originators to sell stock to outside parties

Question 71

if a firm employs other individuals, which funds must the business withhold?

Answer 71

- federal income tax - social security - medicare

Question 72

what type of insurance protects the designer in case of designer-caused injury or property damage?

Answer 72

professional liability insurance

Question 73

which three claims does general liability insurance cover?

Answer 73

1. property damage 2. liability 3. personal injury

Question 74

what type of insurance protects the designer against charges of slander, libel, defamation, or misrepresentation?

Answer 74

personal injury protection insurance

Question 75

what must time and fee estimations be linked to in the provided proposal?

Answer 75

the project scope description

Question 76

what is the term for the all activities a designer will perform in exchange for a fee?

Answer 76

project scope

Question 77

where are the most common design services outlined?

Answer 77

aia document b152

Question 78

true or false: aia document b152 lists other services not outlined in a standard contract.

Answer 78

true

Question 79

how should additional services be billed?

Answer 79

hourly

Question 80

in a contract, what do exclusions clarify?

Answer 80

exclusions clarify what the designer is not legally liable for or able to perform

Question 81

in what document should the designer's fee be outlined?

Answer 81

the contract

Question 82

what is the main function of sending drawings and specs out to bid?

Answer 82

bidding is a way of getting competitive pricing

Question 83

how many days prior to the bid opening should a bidder submit a substitution?

Answer 83

at least 10 days

Question 84

what four elements should every contract include?

Answer 84

1. an offer 2. acceptance 3. consideration 4. mutual agreement

Question 85

what is outlined in a general conditions document?

Answer 85

the responsibilities + liabilities or the owner, designer, and contractor

Question 86

what does indemnification protect an owner and designer from?

Answer 86

loss or damage if a person is injured because of the contractor's negligence

Question 87

a101 - 2017

Answer 87

standard form of agreement between owner and contractor where the basis of payment is a stipulated sum

Question 88

a201 - 2017

Answer 88

general conditions of the contract for construction

Question 89

a151 - 2019

Answer 89

standard form of agreement between owner and vendor for ff+e

Question 90

a751 - 2019

Answer 90

invitation and instructions for quotation of ff+e

Question 91

b-101 - 2017

Answer 91

standard form of agreement between owner and architect

Question 92

b152 - 2019

Answer 92

standard form of agreement between owner and architect for interior design and ff+e design services

Question 93

what should a designer do to prevent lawsuits?

Answer 93

assume nothing and document everything a designer should not assume responsibility for anything they cannot control

Question 94

what is the purpose of terms and conditions?

Answer 94

to identify the rights and responsibilities of parties agreeing

Question 95

how does a project manager estimate the number of hours a firm can spend on a project while still profiting?

Answer 95

divide the money + time each project phase will need by the average billing rate for each designer

Question 96

what type of fee structure specifies a fee that will cover all work and expenses laid out in the scope of services?

Answer 96

lump-sum fixed fee

Question 97

using a lump-sum fixed fee model, can the agreed upon fee be increased?

Answer 97

no

Question 98

what is a cost-plus percentage markup?

Answer 98

the designer sells merchandise to the client and the client pays a specific markup of the actual cost

Question 99

what is a cost-plus fixed fee?

Answer 99

the client pays the actual cost of the work plus an amount for overhead + profit