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APC WG > Case Study / Need to know > Flashcards

Case Study / Need to know Flashcards

1
Q

What are the RICS Rules of Conduct?

A

Rule 1 - Members and firms must be honest and act with integrity

Rule 2 - Members and firms must maintain professional competence

Rule 3 - Members and firms must provide good quality and diligent service

Rule 4 - Members and firms must treat others with respect and encourage diversity and inclusion

Rule 5 - Members and firms must act in the public interest, take responsibility, and maintain public confidence in the profession.

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2
Q

Prior to working with a new client, what checks would you undertake?

A

I would ensure I am sufficiently knowledgeable, skilled and competent to carry out the work

I would check for any conflicts of interest

I would ensure the sufficient PII insurance was in place to cover the value of the instruction.

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3
Q

On receipt of a formal complaint, what would you do?

A

I would -
- Notify them that the complaint has been received and that we are working to rectify this.

  • Issue a copy of my firms complaint handling procedure
  • Report the complaint to the designated complaints handler
  • Meet the client to receive feedback and address any areas of concern
  • And if I was unable to resolve the complaint, I would refer this to the RICS.
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4
Q

If 2 separate departments within your firm were working for 2 rival companies, how would you ensure client sensitive data was managed?

A

I would -
- Inform clients of the conflict of interest and the risks associated with this

  • Request a letter of instruction from them to continue
  • Put measures in place to minimise potential risk, such as NDA’s, separate working locations, and secure storage of data.
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5
Q

What is work place diversity?

A

Diversity in the work place relates to the acceptance and inclusion of employees of all backgrounds.

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6
Q

When did the Rules of Conduct change?

A

February 2022

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7
Q

What are the CPD requirements for MRICS members?

A

Record 20 hours of CPD every year, where a minimum of 10 have to be formal.

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8
Q

Why did the previous Rules of Conduct change?

A

To provide a single document to enable greater clarity for RICS members and firms.

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9
Q

What are the professional obligations of members?

A

1 - Must comply with CPD requirements

2- Must cooperate with the RICS

3 - Provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf.

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10
Q

What is a Red Book Valuation and why do we need it?

A

The RICS Valuation – Global Standards, the red book, provides a global framework of standardized valuation procedures and standards that are necessary for installing consistency, high standards and public trust in valuation.

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11
Q

What should be included in a Red Book Valuation Report?

A
  • Introduction
  • Purpose & Basis of Valuation
  • Assumptions & Special Assumptions
  • Property Description
  • Valuation Date
  • Market Commentary
  • Evidence
  • Signatures
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12
Q

When is a Red Book Valuation compulsory?

A

Legal and accounting procedures such as:
- Probate
- Capital Gains Tax
- CPO’s
- Divorces
- Property Disputes
- Sales by Charities or NPO’s
- Valuation of Bank, Mortgage or Lending Securities

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13
Q

When is a Red Book not required?

A
  • Advice given during negotiations or litigation
  • Internal use with no liabilities
  • Performing statutory functions
  • When acting as an expert witness
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14
Q

What is included in a Red Book Valuation Terms of Engagement?

A
  • Valuer & Client Details
  • Valuation date & subject
  • Basis and Purpose of Valuation
  • Assumptions & Special Assumptions
  • Fees
  • Complaints Handling Procedure
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15
Q

Before accepting a valuation, what should you do?

A
  • Establish the purpose of the valuation
  • Identify if it is a Red Book valuation or not
  • Check for conflicts of interest
  • Check for legal requirements
  • Check for 3rd Party Interests
  • Ensure the sufficient PII is in place.
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16
Q

If I had arrived for the inspection & circumstances had changed or appeared unsafe, what would I have done?

A

I would have carried out a dynamic risk assessment

  • continually re-evaluate to determine competence and safety.
  • If there was unsafe conditions, I would immediately stop, seek assistance and rearrange.
17
Q

What due diligence did I undertake before the inspection?

A
  • Carried out a Desk Top Review
  • Studied the lease / agreement
  • Carried out a risk assessment
  • Printed out plans
  • Ensure I have the appropriate PPE.
18
Q

What measures did I put in place to ensure safety when inspecting?

A
  • Carried out Desk Top Due Diligence & A Risk Assessment
  • Planned Travel Routes
  • Checked the weather forecast
  • Charged my mobile phone
  • Kept colleagues informed of my whereabouts
  • Asked the client / tenant of any potential risks, e.g. livestock
19
Q

What did I include within my risk assessment prior to inspection?

A
  • Identified hazards and risks
  • Who may be harmed and how
  • Mitigation strategy
  • Who is responsible
  • Actions required
  • dates
  • location
  • contact details
20
Q

What are the 5 methods of valuation?

A
  • Comparable method
  • Depreciated Replacement Cost Method
  • Investment method
  • Profits method
  • Residual method
21
Q

What happened in Stokes vs Cambridge (2008) ?

A

The case highlighted a key issue as to what the purchase of additional land for access purposes would cost a hypothetical developer of the subject land. The Court held that a proper price to be attributed to the ransom strip was one-third of the increase in value of the subject land attributable to acquisition of the ransom strip.

22
Q

What is a ransom strip?

A

A ransom strip is a piece of land that must be crossed to enable adjoining land to be developed.

23
Q

What is Market Value?

A

The estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion.

24
Q

What are assumptions? What are special assumptions?

A

Assumptions are conditions or situations affecting the property which (by agreement) are assumed to be true.

Special assumptions assumes facts that differ from actuality, are true.

25
Q

What makes a good comparable?

A

A comparable which is similar in -
- Size
- Nature
- Ownership
- Location
- Disposal method

As close to the valuation date as possible.

26
Q

What is the residual method of valuation?

A

The value of the property once developed, minus the costs of the development, including the developers profit.

APC WG (14 decks)

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