Ethics/Mandatories Flashcards
1
Q
When was the Royal INSTITUTION of Charted Surveyors (RICS) founded?
A
1868
2
Q
How many members are there and what are the 4 levels of membership?
A
140,000
FRICS, MRICS, AssocRICS and Trainee/Student
3
Q
How do you become a Fellow of the RICS?
A
You must provide evidence of four fellowship characteristics:
- Five or more years as MRICS
- Leadership role
- Professional/technical achievement
- Raising the profile of the RICS
4
Q
Who is the current CEO and where would you find them today?
A
Justin Young (July 2023) and London
5
Q
Who is the current President? Where would you find her today?
A
Tina Paillet RICS (1st January 2024) and Paris
6
Q
What major challenges are currently facing the RICS?
A
Lack of young people coming into the industry
7
Q
What are the 3 main roles of the RICS?
A
To maintain the highest standards of education and training
To protect consumers through strict regulation of professional standards
To be the leading source of information and independent advice on land, property, construction and associated environmental issues
8
Q
What is The Birchard Review?
A
The Bichard Review was undertaken by Lord Birchard to clarify the purpose of RICS.
Including its:
- responsibility to act for the public advantage
- make recommendations on its governing structure to deliver that purpose
- provide proposals for the incoming leadership and governing body on the future culture and strategy of the Institution.
9
Q
What are 5 benefits of being a RICS member?
A
Status
Recognition
Market Advantage
Knowledge
Network
10
Q
How often must firms make a return to the RICS confirming their compliance with their obligations?
A
Annually
11
Q
Can a practice be a partnership, an LLP or a sole practitioner?
A
Yes
12
Q
Talk me through the RICS ‘Rules for the regulation of firms’ 2022:
A
A UK firm must be regulated if 50% of Principals are RICS members, if at least 25% are members then the firm can apply to be regulated
Each firm must nominate a ‘Responsible Principal’
Only RICs members and registered firms can use the RICS logo
13
Q
When did the latest RICS Rules of Conduct come into effect?
A
2nd February 2022
14
Q
What are the 5 Rules of Conduct?
A
Rule 1: Members and firms must be honest, act with integrity and comply with their personal obligations, including obligations to RICS
Rule 2: Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise
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 for their actions and act to prevent harm and maintain public confidence in the profession
15
Q
What is the RICS Ethics Decision Tree? What is its purpose?
A
The RICS Ethics Decision Tree provides a framework of questions which members should ask themselves when facing a situation in which they are asked to act in a potentially unethical manner or situation.
16
Q
What are the three levels of disciplinary action?
A
Action by Head of Regulation
Disciplinary Panel (drawn from the independent Regulatory Tribunal)
Appeal Panel
17
Q
What are the 4 disciplinary actions the Head of Regulation can give you?
A
Serve a Fixed Penalty Notice
Make a Regulatory Compliance Order
Refer the matter to a single member of the Regulatory Tribunal for consideration
Refer the matter directly to a Disciplinary Panel
18
Q
What are RICS Professional Standards? What did they replace?
A
These are ‘set requirements or expectations for RICS members and regulated firms about how they provide services or the outcomes of their actions’
Include mandatory requirements, which use the word ‘must’ (which must be complied with)
Or recommend best practice, which uses the word ‘should’.
They replaced the Professional Statements and Guidance Notes
19
Q
What is RICS Practice Information?
A
RICS Practice Information is information to support the practice, knowledge and performance of RICS members and regulated firms.
Publications can include good practice information, insights and processes.
They do not contain advice.
20
Q
What are RICS Practice Alerts?
A
Key tools for warning or alerting the profession to emerging areas of risk over which the RICS has concerns.
21
Q
Tell me about Fee Negotiations
A
- Firms should avoid price fixing, aggressive fee cutting or collusion with competitors
- Fees should be market-based and agreed on an ad-hoc basis with clients
- You should not be seen to be undercutting another firm
- Must be completely transparent with your clients and consumers
- The granting and acceptance of referral fees should also be considered in the context of the Bribery Act 2010 and the RICS Rules of Conduct 2021
22
Q
What heading would you include in Terms of Engagement?
A
- Client name and address
- Surveyor(s) involved
- Scope of the job
- Fee scale
- Who is liable for fees
- Suspension and termination of instructions
- Liability and Indemnity
- Complaints handling procedure
- Anti money laundering
- Data Protection
- Suspension/termination of instruction
- Time frame for payment
- Confidentiality
23
Q
Which Act allows for a 14 day cooling off period from the date of the agreement?
A
The Consumer Rights Act 2015
24
Q
What are the 3 types of conflict of interest?
A
Party Conflict: Relating to work on the same or related instruction for two different parties
Own Interest Conflict: Relating to a personal interest
Confidential Information: Relating to work between two parties that is confidential
25
What is the difference between conflict avoidance and conflict management?
Conflict avoidance is when you do not accept the instruction whereas conflict management is when the instruction is accepted and steps are agreed and put in place to manage the conflict (such as an information barrier). This must involve a written agreement between all parties.
26
What is informed consent in regards of conflict of interests?
Written consent given by parties that are involved in a conflict of interest.
27
Should firms keep records of conflicts of interest?
Yes to maintain compliance with the Professional Standard.
28
What points must you cover when advising parties of a conflict?
1. Disclose the nature of the conflict, circumstances and relevant facts
2. Be clear and ensure both parties can make their own decision - advise them to seek independent advice if needed
3. Request written confirmation from both clients of their informed consent
29
Tell me about a time you have managed a conflict of interest
I managed a conflict of interest when my firm was representing two neighbouring landowners who were applying to the same substation for BESS/solar projects. I wrote to both landowners advising of the situation and asking for their written consent to confirm they were happy to proceed if an information barrier was put in place within our office.
30
Which Professional Standard regulates RICS members on Conflicts of Interest?
RICS Global Professional Standard: Conflicts of Interest, 2017
31
What is meant by the term "Multiple Introductions"?
Where an agent has competing contractual relationships simultaneously with several buyers for commercial real estate investment opportunities
32
What is meant by the term "Incremental Advice"?
This is where an agent is approached by another party to provide advice related to a purchase or disposal that is incremental to an existing instruction
33
What is a Personal Interest/Own Interest Conflict?
When acting for a family member, a close business associate or someone with whom you have a financial or personal interest of benefit
34
Which Section of the Estate Agents Act 1979 regulates Own Interest Conflicts within agency work
Section 21
35
How long should old files be held for before disposal and destroyed securely?
A minimum of 6 years
36
In what case would you have to provide client files to a third party without the client's permission?
A police or HMRC investigation
37
What rules must a firm's complaints handling procedures meet?
RICS Rules of Conduct 2021
38
Who must a firm notify if there is a complaint made?
The firm's PII insurers
39
What must firms include in their Complaints Handling Procedure?
An RICS approved Alternative Dispute Resolution (ADR) mechanism
40
Talk me through the first stage of the Complaints Handling Procedure
This is in house, the complaints handling officer (Charlotte Fairweather) must be contacted, complaint must be made in writing and the complaint must be acknowledged within 7 days and investigated within 28
41
Talk me through stage two of the Complaints Handling Procedure
Independent redress scheme become involved such as The Centre for Effective Dispute Resolution (CEDR), The Property Redress Scheme and the RICS Dispute Resolution Service
42
Who could a sole practitioner nominate as a Complaints Handling Officer
A surveyor in another firm
43
How many hours of CPD must a RICS member undertake each calendar year?
20, 10 to be formal and 10 can be informal
44
Why would the RICS become involved in a complaint
If a member fails to respond to the complainant or prevents the party gaining access to an independent redress mechanism
45
What else must RICS members keep up to date with other than CPD?
They must maintain a relevant and current understanding of RICS Rules of Conduct during a 3 year rolling period
46
How do members record their CPD? And what is the deadline?
Members record their CPD using the RICS CPD Management System on the RICS website.
The deadline is 31st January each year
47
What is the difference between Formal and Informal CPD?
Formal CPD includes all forms of structured learning that has clear learning objectives and outcomes.
Informal CPD is self-managed learning that is relevant or related to your professional role
48
Is there a tool to help me decide if the CPD is formal or informal?
There is an RICS Decision Tree for deciding if the CPD is formal or informal
49
What are the Professional Indemnity Insurance thresholds?
Firms that turnover £100,00 or less must have a minimum level of £250,000
Firms that turnover £100,000 to £200,000 must have a minimum level of £500,000
Firms that turnover £200,000 or more must have a minimum level of £1,000,000
50
How does a new business choose it's level of PII?
Estimate the turnover and adjust in due course accordingly
51
What is the maximum level of uninsured excess required by the RICS?
Firms with a turnover of £10 million or less = the greater of 2.5% of the sum insured or £10,000
Firms with a turnover of over £10 million have no set limit
52
For what reason would you consider declining an instruction?
- You are not competent to undertake the works
- You do not have sufficient facts/information
- Client will not sign ToE or complete AML checks
- Conflict of interest
53
If a management client wanted to take you out for a meal to say thank you for work you had done, what would you do?
I would accept and register this on my companies Gift and Hospitality Register acknowledging the value of the meal and also tell my line manager
54
What is professional indemnity insurance and why do RICS members need it?
PII is a type of coverage that protects professionals against claims of negligence or inadequate work from their clients.
To protect clients, surveyors and third parties against negligence claims where there is a duty of care breached and a claim for damages arises
55
What is unconscious bias?
Unconscious bias is the automatic, unintentional mental shortcuts or prejudices we form based on our background, cultural environment, and personal experiences.
56
What are the 4 bribery offences?
1. Bribing
2. Receiving a bribe
3. Bribing a foreign public official
4. Failing to prevent bribery
57
Which Act governs bribery?
Bribery Act 2010
58
Which Act governs anti-money laundering and terrorist financing?
Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations, 2017 (as amended 2023)
59
What is the purpose of CPD?
Maintain and enhance professional competence
Keep knowledge and skills up-to-date
Ensure relevance in a rapidly changing work environment
Foster career progression and adaptability
Improve job performance and client service
60
Can you tell me about bribes?
A bribe can be the giving, offering, promising or receiving of an advantage such as a payment, gift or service for an action which is illegal or a breach of trust
61
If I was to start up a new firm what would I require for RICS?
I must:
Inform RICS by completing Firm Details Form
Appoint a Responsible Principal for all RICS communication
Arrange PII and send to a copy to RICS
Set up client money handling procedures
Register for the RICS Valuer Registration Scheme
Set up a complaints log and appoint a CPH officer and advise RICS who this is
Plan for succession/future running if a sole practitioner
Ensure CPD logged online
Ensure completion of RICS Annual Return each year
62
How would you go about instructing remedial works?
I would inspect the issue myself / gain a good understanding of the issue from the tenant.
Then I would ask two contractors on my firm's approved contractors list to quote for the works.
Upon receipt of the quotes, I would review and share with my client, advising which I felt was best to go with. After discussion with my client I would instruct the contractor we felt was appropriate for the job.
I would then inspect the works once they were complete, and if I was content I would process the invoice for payment.
63
What is a balance sheet and profit and loss account?
Balance Sheet
- statement of businesses financial position
- shows assets and liabilities at a given date
Profit and Loss
- summary of the businesses' income and expenditure transection prepared on an annual basis
- It helps assess a company's profitability and performance over time.
64
Give me an example of a time when you have provided bad client care?
Not meeting a deadline and having a client chase me for a response
Apologised profusely and got the report to them asap
Advised it wouldn't happen again and explain the reason that it happened and what will be done to avoid this in future
65
What is the RICS cash limit?
10 000 euros
66
What health and safety considerations do you undertake prior to going on a property inspection?
Lone working - ensure my colleagues know my whereabouts by keeping my diary up to date and texting our team group chat when I arrive and leave places
Personal Protection alarm - always carry this to hand when visiting properties
Risk Assessment - carry out a risk assessment prior to the visit, making sure I have considered hazards such as dogs, slips/trips/falls and the lone working risks
67
Where do your loyalties lie? With the firm or with the client and why?
Neither, with the public interest
68
Why is business planning important?
Financial planning is crucial for businesses as it provides a strategic roadmap for managing resources, mitigating risks, and achieving long-term financial goals.
69
What is good client care?
Providing clear, transparent communication and advice to clients, ensuring they understand the services offered, fees, and potential risks.
70
Why did you source specific help from a senior colleague relating to the length of time a ‘Notice to Quit’ should be served prior to the expiration of a commercial lease?
I was not completely confident in the length of notice I should give for the NtQ as it was not outlined in the lease and due to the sensitivity of the tenancy, and the urgency to have the tenant move out, I did not want to get it wrong. Therefore I confirmed with a senior colleague to ensure I followed the correct protocol.
71
In your Conflict of Interest example - what would you have done if one / both of the landowners did not the informed consent letter?
The firm would not have accepted instruction from either landowner
72
Tell me some of the statutory compliance RICS firms must follow
Equality Act 2010
Financial Services and Markets Act 2000
Bribery Act 2010
Money Laundering Regulations 2017 (as amended 2023)
Health and Safety Act 1974, as amended)
Control of Asbestos Regulations 2012
Ensure compliance with current employment law such as National Living Wage, working hours, pensions etc
73
How does your firm tackle modern slavery and human trafficking?
Savills PLC have a Slavery and Human Trafficking Statement which is in line with the Modern Slavery Act 2015. Whilst carrying out checks on directly employed staff, such as seeing passports and proof of right to work in that country, Savills will also only work with contractors and suppliers that's company policy includes compliance with the Modern Slavery Act.
74
Which professional standard outlines the guidelines for handling client money?
RICS Professional Standard: Client Money Handling, 2019
75
What should a client account include?
Must be kept separately and be clearly identifiable
The word client must be on the bank account and cheque book
A client must be able to have their monies on demand
Should not be able to gain interest
Must have two signatories
Procedure documents must be displayed on a firms website
76
What is a discreet client account?
An account run for one specific client, such as an estate managed by the firm
Must be kept separately and be clearly identifiable
The word client must be on the bank account and cheque book
A client must be able to have their monies on demand
Must have two signatories
Procedure documents must be displayed on a firms website
77
How often can RICS Regulatory Review Visits of inspection be carried out?
Usually on a 3 yearly basis by an accountant employed by the RICS
78
If I was to close a firm tomorrow, what would I need to do to meet RICS compliance?
Inform the RICS and deregister
Inform clients and arrange a handover to a new firm
Return monies held for clients
Inform insurers and procure PII run-off cover for a minimum of 6 years
Retain a copy of client files for a minimum of 6 years
79
What are the 6 principles to consider when assessing bribery?
1. Proportionality
2. Top level commitment
3. Risk assessment
4. Due diligence
5. Communication
6. Monitoring and review
80
What are the penalties for bribery?
Bribery Act is policed by the Serious Fraud Office
If this Act is breached, there is a maximum penalty of 10 years imprisonment and/or an unlimited fine.
81
What is money laundering?
When proceeds of criminal activities are disguised or converted and then realised as legitimate assets
82
What must firms put in place to prevent money laundering?
1. Written AML and Terrorist Financing risk assessment
2. Implement systems, policies and controls to address the risks
3. Adopt appropriate internal controls
4. Provide staff training
5. Comply with new customer due diligence requirements
6. Comply with requirements for politically exposed persons (PEPs)
7. Ensure appropriate record keeping
8. AML checks to confirm identity of proposed purchaser, checks purchaser's source of funds
9. Include additional high-risk factors when assessing the need for enhanced due diligence
83
What guidance must estate/letting agents follow in regards to money laundering and terrorist financing?
"Estate agency business guidance for money laundering supervision (updated June 2021)"
Letting agents must register with HMRC if they let individual properties for more than 10,000 euros per month
They must have policies in place to scrutinise transactions that are complex, large, unusual patterns or without economic/legal purpose
84
What is mediation?
Mediation is a process for resolving disputes between two parties where a neutral third person, or mediator, helps them to engage in constructive dialogue with the aim of achieving a jointly acceptable resolution of issues in conflict.
85
What is arbitration?
Arbitration is where both disputing parties agree for a decision to be made by an independent arbitrator (or a panel of arbitrators).
The parties put forward their case to the arbitrator, who will assess the evidence and decide which party’s case was most persuasive. The arbitrator’s decision (called an award) is final and legally binding.
86
What is Expert Determination?
Acts as a decision maker and their decision is usually binding
Appointed jointly by the parties to resolve a specific dispute
Makes their own investigations and reaches their own conclusions
Not bound by rules of evidence or court procedure
Generally cannot be challenged except for fraud, bias, or acting outside their mandate
Usually more informal and quicker than court proceedings
Often used in technical/valuation disputes or where a specific expertise is needed
87
What is the difference between a profit and loss and a cash flow?
A cash flow shows the income and expenditure over a period of time whereas a profit and loss shows a snapshot of the income and expenditure at one point in time
88
How would you start a negotiation?
Phone the other side to understand general points of view and then follow up with emails for paper trail. If negotiation is stuck then arrange meeting
89
What skills do you have that you think make you a good negotiator?
Able to listen to both sides
Ability to put my point across appropriately and efficiently
Personable and calm
90
What date did the latest edition of "Surveying Safely" come into force?
Feb 2019
(second edition)
91
What is the definition of a safe person?
RICS considers the concept of a ‘safe person’ to mean that each individual assumes individual behavioural responsibility for their own, their colleagues’ and others’ health and safety while at work.
92
What is the definition of a hazard?
A hazard is something with the potential to cause harm to someone
93
Tell me about the hierarchy of risk control
A tool to reduce risks in work activities:
1. Elimination
2. Substitution
3. Engineering Controls
4. Administrative Controls
5. PPE
94
Talk me through how I would undertake a risk assessment?
Identify:
what are the hazards?
who might be harmed and how?
What are you already doing?
Do you need to do anything else to control this risk?
Action by whom?
Action by when?
Is it done?
95
Tell me about your understanding of the 'H&S at Work Act 1974, as amended'
Every employer has a duty to ensure, so far as reasonably practicable, the health, safety and welfare at work of all employees
Injuries and dangerous occurrences must be reported to HSE
96
Which recent legislation re-enforced the legalities around wearing PPE at work?
PPE at Work Regulations 2022
97
What is a risk assessment?
A document outlining all significant hazards employees may face during their work
This is a legal requirements for organisations employing more than 5 people
98
What is a method statement?
- details the way a work task or process is to be completed and prior approved
- outlines hazards involved
- must detail which control measurers have been introduced
99
What is a H&S policy document?
A written doc that must contain:
1. A policy setting out the organisations commitment to H&S
2. Details of the organisations H&S structure
3. A RA setting out the risks in the workplace and the preventative measures taken
4. Details of the planning, implementation of the H&S policy and control measures
100
What is included in the 'six pack' of H&S regulations?
1. Management of H&S at work
2. Display screen equipment
3. Manual handling operations
4. PPE
5. Provision and use of work equipment
6. Workplace HS & welfare
101
What do you understand by the term RIDDOR?
Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 2013
102
When must injuries be reported to HSE?
Death
Specified serious injuries
Over 7 days off work
Employers must keep a record of injuries over 3 day plus
103
Tell me about EWS1 forms
External Wall Systems
Introduced after the Grenfell fire
Enables a qualified professional to confirm that an EWS on resi buildings has been assessed for safety
Valid for 5 years
RICS have a decision tree available to understand when an EWS 1 is required
104
Tell me about the Building Safety Act 2022
Intended to enhance regulations for building safety
Implements elements of the Hackitt Review
Act introduced Building Safety Regulator
New high rise buildings must be registered before they are occupied
105
What is social bias?
Biases that relate to our perceptions of ourselves or others, or the ways that we behave, act and reach decisions as a group.
106
What is a method statement?
A document that details the way a work task or process is to be completed and prior approved
Outlines hazards involved and control measures put in place to ensure the safety of anyone involved
107
What is corporate social responsibility?
a business model that helps a company be socially accountable to itself, its stakeholders, and the public.
108
Which RICS Professional Standard relates to bribery and money laundering?
RICS Professional Standard: Countering bribery, corruption, money laundering and terrorist financing, 2019
109
Give me an example of how you follow rule 1 of Rules of Conduct in your everyday work?
I am honest in my day to day work. Recently a tenant asked me on a property inspection if my client was looking to sell the property, I advised my client was considering their options as I did not want to lie to the tenant but I also had to protect my clients interests.
110
Give me an example of how you follow rule 2 of Rules of Conduct in your everyday work?
I ensure I only accept instructions that I am competent to deal with. Recently my team were engaged to act on behalf of a hotel in relation to CPO, I engaged my colleagues from our hotels team to assist on the project as they are more adequately experienced in hotel valuations.
111
Give me an example of how you follow rule 3 of Rules of Conduct in your everyday work?
I strive to provide good quality and diligent service everyday with all clients. I ensure to make regular contact with clients during utilities projects to check in even if there isn't necessarily an update, so that they are aware I am not forgetting about them or the project.
112
Give me an example of how you follow rule 4 of Rules of Conduct in your everyday work?
I promote diversity and inclusion by always ensuring to invite everyone in the office when arranging social events, not just fee earners. I always include business services etc too.
113
Give me an example of how you follow rule 5 of Rules of Conduct in your everyday work?
I ensure I do not list properties at significantly over the market rent as I do not wish to exploit tenants. If a client wanted to list something considerably over the market rent I would advise that this potentially is not in the publics best interest
114
Name some of the chapters in Surveying Safely
Fire Safety
Visiting premises and sites
RICS members places of work
Residential property surveying
115
What would you do if you find asbestos in the property?
Carry out risk assessment
Check if it needs containment or arrange specialised contractor to remove
116
What must RICS firm submit annually?
Complaints register
List of their registered valuers
Copy of professional indemnity
List of highest valuations
