Ethics Level 1 Flashcards
Can you explain the general overview of the New Rules of Conduct (February 2022)?
The Rules of Conduct consist of 5 rules which are based on the ethical principles of honesty, integrity, competence, service, respect and responsibility.
The document consists of the 5 rules for members and firms, providing example behaviours for each rule.
The document ends with Appendix A: Professional Obligations to the RICS.
There are 5 New Rules of Conduct, can you pick one and explain what it is?
Rule 4: Members must treat others with respect and encourage diversity and inclusion.
This rule is all about respecting one anothers rights, treating eachother fairly, not discriminating on any improper grounds, not bullying, harrassing or victmising, not taking unfair advantage or exploiting, working cooperatively and encouraging inclusive cultures in workplaces for all.
Give an example of one Rule that you comply with every day?
Rule 3 - I provide a good-quality and diligent service through ensuring my work goes through quality assurance processes
What is included in Appendix A in the New Rules of Conduct?
Professional Obligations to the RICS - it sets out the core professional obligations for members and firms.
What do you need to do if you set up a practice?
- ensure the relevant insurances are in place
- set up the necessary procedures such as informing the RICS & register for regulation and preparing a complaints handle procedure
- completing the RICS Annual Returns
What are the CPD requirements for a chartered surveyor? What about ethics?
They are required to undertake 20 hours CPD a calendar year, with at least 10 hours formal
They are required to undertake CPD relating to RICS Global & Ethical Standards once every 3 years
Why would you require PII if you were to set up in private practice?
- to ensure that if a firm faces a claim, it is protected from financial loss that it cannot meet from its own resources
- protect the insured firm against the consequences of its liability to pay damages to third parties through breaches of its professional duty that it commits through its professional activities and
- ensure the firms clients do not suffer financial loss which the firm cannot meet
How would you assess the level of PII you would need when setting up in private practice?
As it’s a new firm, I would assess based on estimated turnover for the upcoming year
Would the PII indemnity levels increase as your business expanded?
If turnover expanded into the next bracket as outlined in the RICS UK professional indemnity insurance requirements
When would you arrange run off cover and why and how long is it held for?
RICS Firms are required to ensure run off cover is in place under their PII to cover historic liabilities of a business after it ceases to trade. It relates to any claims made under the policy for work carried out before trading stopped.
For consumer claims, it must be maintained for a minimum of 6 years from the expiry date of the policy in force at the time of cessation
For non-consumer claims, it must be maintained for a minimum of 6 years from cessation of practice
How would you protect your client’s interest if you decided to give up practice?
By ensuring run-off cover is in place
How would you determine the time period that runoff cover would need to be provided?
In accordance with the RICS Professional Indemnity Insurance Requirements
How would you advise your client to give assurance as to how you were going to hold their money, so that it would securely be kept and accounted for?
- confirmation that client money will be held in a client money account including bank account details
- that the RICS-regulated firm has exclusive control over the client money and whether the account is in the name of the regulated firm
- a wholly owned subsidiary or an appropriately contracted third-party transaction service provider
- give advice to clients who pay fees in advance for surveying services (but not property agent services in England) that this money is not covered by the Client Money Protection scheme
- disclosure of all commissions earned by the firm while managing their property
- how unidentified funds are dealt with
- a copy of the firm’s written procedures for handling client money
With regards to client’s money, how should you name the bank account you are required to set up for this purpose?
all client money accounts include the word ‘client’ (written in full) and the name of the firm in the title of the account, and that discrete client money accounts include an identifier (e.g. the client or property name) in the title of the account to easily distinguish it from other accounts of the RICS-regulated firm
Why do we ring-fence client’s money placed in our trust?
So if the firm becomes insolvent, the money cannot be touched
