Ethics Q&A Version 2 Flashcards
What is the role of the RICS?
The regulatory body for Property, Construction and Land.
Maintain highest standards of education and training
Protect consumers through strict regulation of professional standards
Be the leading source of information and independent advice
What is the difference between Level 1 and 2 and level 3?
Level 1 - knowledge and understanding. (Learning) Level 2 – application of knowledge. (Doing) Level 3 – (Advising)
Difference between informal and formal CPD?
Formal CPD involves participating in structured activities, e.g. courses, seminars and workshops. Informal CPD involves activities undertaken by the individual, like experiential/workplace learning, reading and research.
What is the Annual CPD Requirements?
Minimum 48 hours every 12 months - APC Candidates Qualified – 20 Hours and at least 10 hours formal (ethics CPD every 3 years) Recorded on RICS CPD Management System
Why is it important for RICS members to undertake CPD?
One of the Rules of Conduct (Rule 2 ) Professional Obligations Appendix A in Rules of Conduct Means we can continue to offer the best service possible to clients by being up to date and in the know on latest guidance and information.
Who is the RICS ultimately accountable to?
The Public
What are the Rules of Conduct 2021 effective Feb 2022?
A set of rules for both members and firms. Clear examples and behaviours for each rule. They are based on ethical principles
What is rule 1- RICS Rules of Conduct 2021?
Members and Firms must Be HONEST and act with INTEGRITY and comply with their professional obligations including obligations to the RICS
What is Rule One - RICS Rules of Conduct 2021?
Members and Firms must Be HONEST and act with INTEGRITY and comply with their professional obligations including obligations to the RICS
What is Rule Two - RICS Rules of Conduct 2021?
Maintain PROFESSIONAL COMPETENCY and ensure services are provided by COMPETENT INDIVIDUALS who have the NECESSARY EXPERTISE
What is Rule Three - RICS Rules of Conduct 2021?
Members and Firms must provide GOOD QUALITY and DILIGENT Service
What is Rule Four - RICS Rules of Conduct 2021?
Treat others with RESPECT and encourage DIVERSITY AND INCLUSION
What is Rule Five - RICS Rules of Conduct 2021?
Act in the PUBLIC INTEREST and take RESPONSIBILITY for their action, act to prevent harm and maintain public confidence in the profession
Appendix A to the Rules of Conducts sets out “professional obligations” which are to be followed by members and regulated firms. What are they?
RICS Members:
Comply with CPD Requirements
Cooperate with RICS Promptly provide all information requested by Standards and Regulation Board RICS
Regulated Firms:
Publish complaints handling procedure maintain a complaints log
PII cover
If having a sole principal, make sure appropriate arrangements are made if unable to continue working
Promptly provide all information requested by Standards and Regulation Board
Why did RICS introduce the new Rules of Conduct 2021?
Simpler structure – providing more confidence for clients and public Focusing on diversity and inclusion underpins professional ethics
How does your firm demonstrate implementation of the Rules of Conduct?
My firm is not a chartered practice.
How do you demonstrate implementation of the Rules of Conduct?
I always assess my competence prior to undertaking instructions. I comply with the CPD requirements (as per professional obligations) I provide a high level of service and client care.
Give me an example where you have shown integrity?
I politely declined an invitation to a hospitality event, which was received by a contractor tendering for a substantial contract. Given the close proximity to the tender dead line I decided accepting the invite may have been perceived to be undue influence. When conducting a tender process.
I ensure any additional information is circulated to all parties to ensure everyone is acting on a level playing field. I do not provide details of one tender submission to another tendering party.
What are the RICS CPD requirements once qualified?
MRICS – 20 hours (at least 10 formal) (Student is 48 hours)
What does it mean to be a professional?
Always carry out good quality work, act with integerty and consider the public interest and uphold the RICS Professional Standards when carrying out work.
Being recognised member will provide confidence to my client of my professionality.
Give me an example where you have provided a high standard of service?
Once tenders have been received for a works package I will analyse and summarise in a table to make it easier to review and present my findings to the Head of Department. I will then follow up with a tender report summarising my opinion of the strength and weaknesses of the tenders received, with a recommendation allowing the board to make an informed decision.
When working on a design and build project for a housing association client I have identified discrepancies within the employers’ requirements which do not align with client wider brief and goals for the site, in this instance I have scheduled a meeting to discuss and proposed alternative approaches which better meet their needs or ambitions. A recent example of this was a finishing specification, which contained a number of rather dated requirements, which I did not feel would align with their goals for the project, these items were omitted and replaced with alternative specification upgrades.
How do you promote trust in the profession?
Throughout my work, where applicable I look to utilise the RICS Black Book publications and professional standards, following best practice to ensure I provide professional advice to my board.
I uphold the RICS rules of conduct in both my public and private life. If I am faced with an ethical challenge, I will think of the consequence of my decision on others, using the RICS decision making tree and seeking guidance to ensure I act in public interest.
Where have you taken responsibility?
If I make a mistake, I take responsibility for this and promptly address it, I ensure to make sure my head of department aware of the mistake and appropriate measures taken. I always act with skill, care and diligence.
An example of this is an advice note I had prepared which had confused the parties in one paragraph, upon becoming aware I immediately revised and re issued to the distribution.
When working with external Clients, I ensure they are aware of my Company’s Complaints Handling Procedure and provided with the contact details of my Head of Department. If I receive a compliant, I will ensure it is dealt with professionally and appropriately
How do you treat others with respect?
I do not discriminate and actively work on minimising my unconscious bias. I have recently undertaken online unconscious bias awareness training to recognise any unconscious bias I might have and how to better ensure this does not influence my actions/decisions.
Example:
A Sub-Contractor telephone called me, very angry regarding a matter that had occurred onsite. Regardless of what he said to me, I remained calm and polite and treated him with respect and advised I would look into it and come back to him shortly.
How do you promote the profession - For your firm?
Engage in local community with careers fares to encourage young people to have an interest in property development.
What is the RICS Decision Making Tree?
Provides a framework of questions which members should ask themselves when they are asked to act in a potentially unethical manner. It encourages consistency with the rules of conduct. For example: Is it Legal? Do I have all the facts? Would I be comfortable if this was released into the public eye?
Tell me about the RICS Professional Standard ‘Conflicts of Interest’ 2017?
Effective 2018 Mandatory rules which do not allow any Member to provide Client advice or represent a client where there is a conflict or a serious potential for one.
Discusses avoiding conflicts and the management of conflict where a member can continue despite there being a conflict (whilst still being independent and impartial and in client’s best interest)
Lays out the three types of conflict – party, own interest & confidential information
Provides information regarding prior informed consent and information barriers
What is a bribe?
4 offence defined in the Bribery Act 210 The giving, offering, promising or receiving of an advantage such as payment for an action
Tell me about the Bribery Act 2010?
4 Offences: (1) to bribe, (2) receive a bribe, (3) bribe a foreign public official or (4) failure to prevent a bribe 6 principles: Proportionality, Top level commitment, Risk Assessment, Due Diligence, Communication and Monitoring and Review. Ensures adequate procedures are in place with correct monitoring and risk assessment. Staff training, provision of clear policies and regular reviews. Not all gifts are deemed to be bribes – its whether they are REASONABLE and PROPORTIONATE. All gifts would need to be recorded on a gift register Max 10 year’s imprisonment or unlimited fine Policed by serious fraud office
What are the 6 principles of the Bribery Act 2010 companies should put in place?
- Proportionality
- Top-level commitment
- Risk assessment
- Due diligence
- Communication
- Monitoring
- Review
Name two key components of legislation that relate to gifts, bribery and corruption?
- Bribery Act 2010
- Proceeds of Crime Act 2002
What does the Serious Fraud Office do?
They police the Bribery Act 2010.
What are the penalties of the Bribery Act 2010?
Maximum 10 years in prison and /or unlimited fine
What are your company’s gifts and hospitality rules?
Limits: Receipt of gifts up to £150 Receipt of hospitality up to £250
Must not give or received during tender process
Would record in gift register Complete gift register where receive over these limits and receive approval for manager
If unable to return gift/rude donate gift in charity raffle
Limits on gift register?
Cannot be more than £540 in a singular year from the same firm.
I would consider what was proportional, however subject to the circumstances.
What would you do if you were offered a dinner at a Michelin Restaurant?
Depends on the proportionality, timing and how lavish.
If I were invited by a client who I completed a high value design and build project for successfully I might accept, however if I was invited by a client during a project or during a bid, I wouldn’t.
In any case I would also need to gain approval in line with company policy.
Have you ever received a gift?
I have not received a gift. However, I am aware the my firms gifts and hospitality rules.
My firm implements a charity raffle for any christmas gifts and hampers to ensure they are shared across the whole firm.
This would then be recorded on the gift register
What would you do if you were offered a gift by a contractor working for you?
I would politely decline.
What is Money laundering?
The process by which the proceeds of crime are converted into legitimate funds e.g. buying property with the proceeds, which are then ‘cleaned’ when the property is sold.
What would you do if you suspect something suspicious?
In the context of money laundering.
I would inform my Company’s in-house legal team (Alexandra Barker – Group Company Secretary), who would submit a Suspicious Activity Report to the National Crime Agency.
Proceeds of Crime Act 2002
Offences: Concealing criminal property, making arrangements with criminal property, acquisition, use and possession of criminal property, failure to disclose and tipping off (5 offences)
Max 14 year’s imprisonment & unlimited fine if assist Max 5 year’s imprisonment & unlimited fine if tip off or fail to report
What are the requirements of the RICS when setting up a new firm?
- Contact the RICS for guidance and obtain a company start up pack.
- Inform the RICS and register for regulation.
- Appoint a responsible principal for all RICS communication
- Prepare a complaints handling procedure and establish a complaints handling procedure.
- Procure sufficient PII and send to RICS details
- Establish a Client Money Handling procedures and protection scheme
- Establish a third party ADR scheme. Ensure use of RICS logo is compliant
- Set up succession plan if sole practitioner - Ensure CPD is logged Establish Staff training plans
- Use the designation ‘Regulated by RICS’ on all practice materials.
- Abide by the Rules of Conduct for Firms.
How do you close an RICS Firm?
- Inform the RICS Inform my Clients Inform Insurers
- Return Client Money
- Ensure I have run-off cover for a minimum of 6 years
- Retain Client files for minimum of 6 years
What is Professional Indemnity Insurance?
PII is primarily there to protect the Client against financial loss as a result of breach of professional duty of care the firm cant or won’t pay (such as neglect, errors or omissions’)
All policies must be underwritten by an approved insurer Must have appropriate level of indemnity cover governed by Firm’s turnover:
If turnover is £100,000 or less - PI Cover Is?
Minimum Level of indemnity required: £250,000
If turnover is £100,001-£200,000 = PI Cover is?
Minimum Level of indemnity required: £500,000
If turnover £200,001 & above = PI Cover is?
Minimum Level of indemnity required: £ 1 million
What level of run off cover is required for consumer work?
Must have adequate and appropriate run-off cover following cessation of trading Consumer claims – min of £1,000,000 of aggregate cover min 6 years. —— Details set out in the RICS Professional Indemnity Insurance Requirements Version 9 2022
What level of run off cover is required for consumer work?
Commercial claims – must consider what is appropriate for a min 6 years Insurance Certificate to be sent to RICS on annual basis as part of Firms annual return to RICS Early notification to firms insurers when a potential claim arises —- Details set out in the RICS Professional Indemnity Insurance Requirements Version 9 2022
What is my firms PII Cover?
My Firm does not advice others, however, has £10m cover.
Do you think your firms PII cover is fair?
It reflects the high value construction projects undertaken.
In relation to PII, what does retroactive mean?
The policy covers claims that are made within the insurance period, regardless of when the negligent act occurred.
What are the RICS rules regarding PII for Registered Firms?
Mandatory requirement - Rules of Conduct for Firms Need RICS approved insurer (list on website) Need adequate and appropriate level for each instruction
Why would level of premium vary?
Vary dependent on level of risk and type of projects, such as the use of MMC.
Why do firms have PII?
One of the Rules of Conduct. Protects against negligent behaviour. Protects clients, the firm and me.
What is the Members Support Service?
RICS Runs a Members Support Service (MMS) for chartered members facing claims personnaly for work carried out by an employer who has gone into administration.
Is PII needed for pro-bono (unpaid) work?
Yes
Are there any guidance notes to be aware of for PII?
RICS Practice Information ‘Risk, Liability and Insurance, 1st edition 2021’ Always have a liability cap Make it clear that in a scenario when giving advice it can only be relied upon by the client and not third parties. Clearly stated in terms of business.
What if insurers want to take over a complaint?
I would continue with normal procedures, inform the complaints handler. . Good take their advice but not essential for insurers to take over the complaint - RICS
Gaining PII cover as a start up?
Can base minimum PII cover on revenue forecasting
What is the purpose of PII?
The purposes of having professional indemnity insurance are to: ensure that if the firm faces a claim, it is protected from financial loss that it cannot meet from its own resources, protect the insured member or firm against the consequences of its liability to pay damages to third parties for breaches of professional duty that it commits through its professional activities
What is the difference between professional indemnity insurance and liability cap?
A liability cap limits the amount of damages that a client can claim even in the event of a negligent claim. This allows the firm to limit risk. Must be written in firms terms of business. Factors to weigh up include: Risk level, fee, PI premium, type of client. Liability cap could be set as multiple of a proposed fee, amount loaned or value of a construction contract. Liability cap is a contractual agreement between a client and a firm. The maximum amount that would be paid to the client in the event of a claim. However, PI limit – The maximum amount that the insurer would pay out for a claim. Best practice to agree a cap below the PI limit.
If you sign with a new insurer who will pay a historic claim?
The new firm will be liable
What is negligence?
When a duty of care is breached and this results in a loss. A negligence claim can arise.
How to avoid negligence?
- Understand the clients objectives
- Confirm instructions in writing in TOE
- Competently Undertake work in accordance with Professional standards and practice information
- Agree liability cap below PI limit.
What is the limitation act 1980?
Current limitation periods for negligence are: Contract – 6 years from date of negligent act or breach of contract S. 14A also provides alternative limitation period of 3 years from the date of knowledge of the damage subject to a 15 year long stop from the negligent act. Tort – 6 years from the date the claimant suffered the loss Liability is 12 years as default when entering into deeds/warranties.
How long should old files be held for and why?
Minimum 6 years, then destroyed securely. PII claims can be made up to 15 years after work was undertaken.
What is a conflict of interest?
A conflict of interest is where the interests of one client are incompatible with the interests of another, therefore influencing my ability to remain impartial. There are three types of conflict defined by the RICS professional statement: party conflict, own interest conflict and confidential information conflict.
An example of a party conflict would be if I was instructed to dispose of one client’s property and also instructed to acquire that same property by another client.
An example of an own interest conflict would be if I were instructed to value my mother’s home.
An example of a confidential information conflict would be if one client’s requirements were to keep information regarding a property confidential, however another client’s instructions were to obtain said information.
How can a conflict of interest be managed?
Step 1 – Conflict Avoidance Consider where you can still remain impartial
Step 2 – Written Advice to both parties Must disclose the nature of the conflict and circumstances surrounding the facts Ensure both parties can make an informed decision Written confirmation from both clients – Informed consent?
Step 3 – Conflict Management Set up an information barrier
Provide an example of where you have managed a Conflict of Interest?
Working in house this is slightly different to consultancy. My firm was carrying out a development for a client on a design and build basis, during this period the client fell into a dispute with a contractor on another project over additional costs. The client asked me for advice and my opinion in relation to their other project and the contractor claims – even though my understanding was limited. At the same time, the client asked our firm to provide a tender to complete the site. I explained that it would not be possible for me to advice on their situation with their current contractor, as I am not their advisor. At the same time, they have asked my firm to provide a tender to complete the development. In any case it would be a conflict of interest to advise on their situation and prepare a tender for the same situation, albeit it is not appropriate for me to give advice.
Would a friend asking for advice be an own interest conflict?
I would consider how close the friendship was and whether I could remain impartial
Examples of where a Conflict of Information exists and cannot not be managed?
RICS Conflict of Interest 2017
Dual Instruction – Where a consultant has a contractual relationship with both developer and client. Another example
What is Incremental Advice? (COI)
Incremental Advice- Is the situation where a surveyor is acting for one party in a transaction and the other party in the transaction looks to appoint the surveyor to advise them on the same or another matter at the same time. RICS members must only provide incremental advice if consent is given, and information barrier put in place
What is a Personal Interest/Own Interest Conflict?
Personal Interest/Own Interest Conflict – Tendering works to a business associated closely associated to a family member. Must not let this interfere with professional judgement. Full transparency is required, head of department must be made aware.
What is Informed Consent?
Provided in writing. Explaining the position is entirely transparent. Only seek informed consent if all relevant parties are satisfied.
How would you impose an information barrier?
Surveyors physically separated All information should be securely stored Keep clear audit trail of all written and oral communication
Who enforces an Information Barrier?
‘Information Barrier’ means: the physical and/or electronic separation of individuals (or groups of individuals) within the same firm that prevents confidential information passing between them. To comply with the professional standard, to implement a information barrier as a conflict of interest mitigation measure you first require informed consent from all affected parties And then must retain a clear Audit Trail.
What is your firms CRM system?
Provides a central place where information is stored such as client data and track client interactions which is then available to colleagues. A bespoke application of Microsoft Dynamics
What is an NDA?
Non-disclosure agreement. A contractual agreement binding me to keep the stated information confidential. Must be signed and lay out specifics.
What is the Red Book?
Professional Standards document for property valuation. Sets out detailed guidelines and best practices to ensure consistency, transparency and professionalism in the valuation process. Widely used for property sales, purchases, mortgage valuations and finance reporting.
What is the Black Book?
Collection of technical practice documents which covers all processes throughout the construction project life cycle. A project is currently underway to review and update the Black Book content with the aim of producing a comprehensive new edition, with improved presentation and navigation. Expected to publish in 2025, the new Black Book will comprise of an overarching global professional standard, accompanied by practical guidance material.
Why do you want to be MRICS?
On a personal level this is something I have been working towards and wanting to achieve over the past 6 years. It would make me incredibly proud. On a general level becoming a Member of the RICS will give my board and external clients more confidence in the service I provide them. I will also further improve my knowledge, market advantage and network (130,000 professionals worldwide)
Why do you want to be a surveyor?
I have strong interest in property and the built environment Working as a Quantity Surveyor I enjoy the impact I can have throughout the design and construction of new homes, shaping communities and delivering good quality, efficient homes.
Where do you see yourself in 5 years time?
Still at the same firm. Hopefully a RICS Member In a more senior role, helping train new graduates to become professional and competent surveyors.
What are Stonebonds code of conduct?
Don’t take any bribes. To report any knowledge of bribes. Treat others with respect. To ensure compliance with our gift & hospitality policy and ensure that the gifts register and updated appropriately.
What has been the highlight of your career so far?
One of the highlights was a project in Melbourn, South Cambridgeshire where we delivered 23 houses for private sale and S106 affordable, which was the first project I oversaw from start to finish as Project QS. Name another
What is the biggest challenge you have faced as a surveyor?
A major challenge I have faced was when a groundworks subcontractor on one of our projects served our firm with a termination notice for alleged breach and abandoned their contract works, they simultaneously submitted a final account application proportion over £500,000 in additional preliminary costs, fluctuations and loss of profit. My firm had not committed a breach. The contractor then referred the dispute to adjudication, requesting confirmation we repudiated the contract and a true value assessment of their final account. This was extremely challenging as I had only recently taken over the project and only had a very short time to familiarise myself and prepare a witness statement. Their adjudication failed, the adjudicator concluded we was not in breach and awarded us costs.
How would you deal with difficult colleagues?
Manage – have an open communication to address potential differences Potentially raise to HR is the situation is not manageable and is deteriorating quality of work
How are you competent at your job?
Ensure I stay up to date with economic news e.g interest rates and housebuilding policy. Ensure I carry out CPD Ensure I read the relevant professional standards and guidance notes for instruction
Difference between negligence and being wrong?
Negligence isfailure to provide services with the standard of skill and care that would be expected from a reasonable body of the professional’s peers
Being wrong is open for interpretation and is often subject to opinion.
When may a surveyor be negligent and how could this be avoided?
Duty of care exists for clients and third parties. If this is breached and there is a loss, they can claim damages. A surveyor could be negligent if they fail to understand the client’s instruction or fail to undertake work in accordance with RICS Standards & Guidance Notes. To avoid this, surveyors should sure they are sufficiently briefed and keep good records of all the work they carry out, ensuring they explain why they have made decisions when conducting their work.
Can you name an ethical scenario you have faced?
During an ethical tender process I was invited to a races hospitality event… which I politely declined as this could impact my impartiality and be perceived as inappropriate even if it didn’t.
Why is importance for a member to be solvent?
Top up hold the RICS Rules of Conduct. If a member was facing financial troubles, they could be more open to bribes or cut corners with the work they carry out. Put the profession into disrepute.
The Levitt Review (2021) - what is it?
Findings: Lack of clarity, structure and purpose of RICS governance arrangements
Inadequate cash flow management - The RICS’ extended its overdraft facility without informing the management board
Levitt described a ‘toxic power struggle’ over governance structure of RICS Levitt called for a full independent review of the “purpose, governance and strategy” of RICS
What’s your opinion of the Levitt enquiry?
Disappointed in the events. As members, we adhere to strict ethical standards, which the RICS didn’t do in this instance. However, I am pleased to see the outcome of the Bichard Review.
What happened in the Bichard Review?
Following governance failings within RICS carried out by Levitt in 2021, RICS commissioned Lord Bichard to undertake a further review.
Reported in June 2022 making 36 recommendations in 7 key areas:
* Showing greater leadership on sustainability Empowering and enabling members through greater support for regional boards
* Increased focus on diversity and inclusion - RICS Recruit Diversity, Equality and Inclusion and Sustainability panel chairs as new governance structure.
* Improving public interest – created a public interest panel to advise governing council.
What were the key principles of ‘Defining our Future’?
a Kath Fontana, the previous president, launched this review. The main aim is to review the RICS business plan:
- how to maintain public and stakeholder trust
- how to ensure RICS remains a sustainable body
- How RICS can be aligned to further reinforce relevance to members.
Define Gross Development Value
The aggregate market value of the proposed development, assessed on the special assumption that the development is complete on the date of valuation in the market conditions prevailing on that date.
What is the RICS Professional Standards?
They set:
Mandatory requirements that surveyors must follow, where the word ‘must’ is used.
Best practice that surveyors should follow, where the word ‘should’ is used.
In these instances, there may be alternative approaches or methods that may achieve a better overall outcome. This will be up to the individual surveyor to decide upon.
What is the RICS Practice Information?
This is supplementary guidance to support surveyors in delivering specific services or working in specific areas of practice. The guidance is not mandatory and does not provide explicit recommendations. Practice Information can include ‘definitions, processes, toolkits, checklists, insights, research and technical information or advice’
What is the RICS Practice Information - Why is this important?
If a surveyor faces a professional negligence claim or RICS regulatory or disciplinary proceedings, they will need to be able to evidence that they acted with reasonable competence. This can be through demonstrating compliance with RICS guidance in Professional Standards and Practice Information
Use of Social Media?
I would refer to the RICS Regulation – Use of Social Media 2021. Also have reference to the RICS Code of Conduct
Four levels of membership to RICS?
FRICS MRICS AssocRICS Trainee/Student
How to become a Fellow of the RICS?
Five or more years as MCRIS
Leadership Role
Professional/Technical Achievement
Rasing the profile of RICS
Current CEO of RICS?
Justin Young
Current president?
Tina Paillet FRICS
What is a Responsible Principal?
Each firm must nominate a responsible principle who makes sure the firm adheres to the RICS requirements.
Who are principles?
Sole practitioners
Directors
Partners
Board members
Role of a RICS Principal?
firm comply with RICS code of conduct firms systems and controls meet legal requirements ensuring that there are adequate processes and systems to record any failures to comply with RICS and/or legal requirements
Firms required to be regulated by RICS?
the Firm provides surveying services to the public at least 50% of the Firm’s Principals are RICS Members.
What are the benefits of a firm being registered?
Confidence - for clients as regulated firms are monitored by RICS.
Professionalism - firms must provide clear, impartial, expert advice.
Security - firms must have a recognised CHP and PII cover.
Firms eligible to register?
A Firm is eligible to register for regulation by RICS if: the Firm provides surveying services to the public and at least 25% of the Firm’s Principals are RICS Members
Obligations of RICS Regulation?
Comply with the Rules of Conduct and these Rules Act in accordance with the obligations set out in RICS’ Royal Charter and Bye-Laws Rules for the Regulation of Firms 2022 – Regulation
What are common breaches of RICS?
Not logging CPD
RICS Motto?
There is measurement in all things
Who can use the RICS logo?
RICS members and registered – subject to the guidelines
Who controls disputes about becoming a registered firm?
Standards and Regulation Board
When could a NDA be released?
In the first instance, I would have reference to the RICS Ethics decision tree If someone is in harm/affect to individuals health (Rule 5 of RICS)
What would you do if someone left an envelope in meeting room?
First, try and return it to owner
Send email for clear audit trail Store in a secure place – photo evidence
Reference the RICS ethics decision tree
How does your firm want to represent itself?
As the development partner of choice, recognised for a quality product, sustainable practices and personal ethos which sets us apart.
How does your firm value sustainability?
Stonebond are actively working with our clients to improve the sustainability of new homes, we have recently completed our first homes by timber frame construction. PV has been introduced to many schemes by regulation, however as a business we are looking to offer these to customers as an upgrade during construction, including battery storage.
- Strong ESG Framework Reporting - Partnered with Community Wood Recycling to ensure all timber waste is recycled
- Replaced all fleet vans with Hybrid vehicles. - Introduced an EV Company Car Scheme to look to reduce emissions
How does your firm measure social value?
Stonebond has adopted a comprehensive set of measures outlined through the National TOMS Framework to report social value. This focuses on four key themes: local jobs and skills, supporting regional business, creating healthier communities, and protecting the environment.
What are your firms values?
1 - To ensure all we pay our supply chain on time, every time. Within 28 days and have signed up to the prompt payment code. To ensure our projects are carried out to high quality standards.
2 - To ensure high levels of end user satisfaction, which is currently at 100%.
3 - Our team work collaboratively and the firm encourages people fulfil their potential.
Can you tell me article you recently found interesting?
The Construction Journal on the payment terms in 3C v Lidl. REVIEW!
BCIS Insight - Why are contractors in the construction industry vulnerable to insolvencies? REVIEW!
The Construction Journal on Data centre growth seen in scaled schemes and retrofits. REVIEW!
What would you do if offered to attend a lavish hospitality event the day after completion?
I would consider the timing and proportionality Day after too soon. Wrong perception to my client.
What would you do if you were offered a gift after an instruction had been completed?
Check company gift policy. Check reasonableness. Accept if reasonable.
What would you do if you were offered a gift by a third party or contractor?
Politely decline as they are not my client.
What would you do if you were offered a gift during an instruction?
Politely decline as the instruction is not yet complete and this could impact my impartiality.
What would you do if rejecting the gift would offend the client?
Would report it to my Head of Department and Company Secretary. The Head of Department would either donate the item to charity or distribute or raffle the item among a large group of employees. All Gifts received at Christmas which exceed the firms gift limit are raffled to staff for charity.
How does the RICS regulate itself?
Self-regulation
What are the different advice levels of RICS documents?
Professional Standards (Recommended or Mandatory) (subject to Must or Should)
Practice Information (not mandatory, doesn’t set requirements)
Examples of International Standards?
New Rules of Measurement (NRM) International Property Measurement Standards (IMPS)
Examples of Professional Standards?
Conflicts of Interest (2017)
Surveying Safely (2018)
Asbestos (2021)
Countering Bribery, Corruption, Money Laundering and Terrorist Financing (2019)
Examples of Practice Information?
New Rules of Measurement (3rd edn 2021)
Black Book contains a range of practice information.
- Commercial Management of Construction Projects (2016)
- Cost Reporting (2015)
- Management of Risk (2016)
- Termination of Contract, Corporate Recovery and Insolvency (2013)
What have Guidance Notes been recategorised into?
Professional Standards
Old Professorial Statements and Guidance notes have been simplified into the Professional Standards.
Delete this card
Code of Measuring Practice (2015)
What is NRM1?
Order of cost estimating and cost planning for capital building works
It provides a framework for preparing cost plans and estimates, and is used to ensure accuracy and transparency in the cost-planning process
What is NRM2?
Detailed measurement for building works
NRM2 isa document that provides a standardised method for measuring and describing building works
What is NRM3?
Order of cost estimating and cost planning for building maintenance works
NRM3 isa set of documents that provide guidance on cost estimating and cost planning for building maintenance works
What are the stages of the RIBA Plan of Work?
Stage 0: Strategic definition
Stage 1: Preparation and briefing
Stage 2: Concept design
Stage 3: Spatial coordination
Stage 4: Technical design
Stage 5: Manufacturing and construction Stage 6: Handover
Stage 7: Use
What year was RICS founded?
1868
When did the RICS receive Royal Charter?
1881
What is Royal Charter?
Method of incorporation granted by the Monarchy. Ensure RICS act in the public interest! References Bye Laws and Regulations
How is the RICS Governance Structure shaped?
Royal Charter
Bye Laws
Regulation
What is the Governance Structure of the RICS?
How is the RICS Structured?
- In 1881 the Royal Charter was granted by the Privy Council.
- The RICS is Self Regulated and internally monitored (not monitored by government or external parties)
- The Bye-Laws determine how the RICS is regulated
- The Governing Council manage and agree the strategy for the RICS.
The Regulatory Board, Audit Committee and Management Board are beneath the governing council and execute the strategy set by them.
The Management Board comprises 17 professional groups, one being QS and Construction.
What is the role of the Privy Council?
Grants awards and Royal Charter
What is the role of the Governing Council?
Sets global strategy and ensuring RICS fulfils its Royal Charter obligations, Bye Laws And Regs Following the Bichard RICS Review, Governing Council has agreed a series of measures to create a clear and accountable governance structure.
What is the role of the Standards and Regulatory Board?
They are responsible for exercising the standards and regulatory functions of the RICS. In June2023 all of the RICS Standards and Regulation board resigned – disagreement over structure of RICS
RICS Governing Council planning to break up board and transfer responsibilities for technical standards to newly established knowledge and practice committee.
What is the role of the Management Board /RICS Board?
To direct RICS affairs under delegated authority from Governing Council. Comprised of non-members (independent), members of RICS, and RICS Executives
What is the role of the Audit Committee?
The Committee’s role is to monitor and assess the effectiveness of the organization’s financial reporting, internal controls, and risk management systems. They also reviews anti-fraud measures, Raising Concerns policies, and recommends the external auditor
The Audit Committee operates independently of Governing Council, the Management Board and the Standards and Regulation Board. Each year it reports to Governing Council on how it has discharged its duties. Comprises member and non-members.
What is the role of the Regulatory Tribunal?
Regulates the RICS as a fair and independent judicial body consists of lay members and RICS members
What are the principles of regulation?
They provide a framework within which members and firms can decide how to best meet the rules of conduct requirements.
What are the RICS 5 principles of better regulation?
Proportionality
Accountability
Consistency
Targeting
Transparency
RICS Bye Laws?
Bye Laws and regulations apply to a member of firm and ensure regulatory best practice. Managed by Privy Council 10 Bye Laws inc:
-Membership and registration
–eligibility and procedure Contributions to funds e.g fees and subscriptions Conduct
– members conduct themselves in a manner benefitting RICS Governing Council, Officers and Staff
– Structure
What do the RICS Bye-Laws state regarding confidentiality?
Client confidentiality must be maintained for all client affairs.
RICS Regulations?
Managed by Governing Council 10 RICS Regulations (same as bye laws)
The regulations set out any additional definitions which shall apply to the bye laws.
In the event of any variation in a Regulation the definition in the Regulation shall apply provided approved by Governing Council.
Membership and registration –eligibility and procedure Contributions to funds e.g fees and subscriptions Conduct Governing Council, Officers and Staff
Disciplinary procedures and how can they be triggered for not following the Rules of Conduct?
Complaint to RICS . Allegation by 3rd party Information established by RICS
What are the three levels of disciplinary action?
Action by Head of Regulation (1) Regulatory Tribunal (2) Appeal Panel (3)
What are the most common breaches?
Professional behaviour CPD Protecting Clients Money.
What can the Head of Regulation (Nigel Clarke) initiate following their investigations?
Fixed penalty notice
Regulatory Compliance Order - Written document outlining a firm must take certain actions and agreement to pay a fine
Refer to Disciplinary Panel - Procedure used for more serious breaches of conduct. Who canIssue a regulator compliance order as above, Fine or Expulsion from RICS
What are fixed penalties?
Used for breaches of the Rules relating to the supply of information to the RICS by firms and members.
What are CPD sanctions?
They place an obligation on a member to follow the CPD requirement.
When is action by the Regulatory Tribunal taken?
On more serious breaches of conduct.
Who comprises the Regulatory Tribunal?
Both independent members and RICS members
What penalties are available to the Regulatory Tribunal?
Compliance Order
Unlimited fine per breach
Conditions on future RICS registration
Expulsion
Publication of results on website
What does the appeal panel do?
Will hear a firm or member’s appeal. Review the decision. Can allow the appeal or vary the penalty imposed.
Do you have an internal policy to Modern Slavery?
Yes my firm has a modern slavery policy
the Organisation has a zero-tolerance approach to any form of modern slavery
The Organisation considers its main exposure to the risk of slavery and human trafficking to exist in using suppliers, contractors and sub–contractors
What legislation are you aware of which enorages inclusive envirments?
Part M Building Regulations & Equality Act 2010
What is the CDM Regulations?
The Construction (Design and Management) Regulations 2015 (CDM 2015) are UK regulations aimed at improving health, safety, and welfare in construction projects by outlining the responsibilities of all parties involved.
Designers are responsible to consider how the building can be constructed and maintained safely during design.
What is the Health and Safety at Work Act 1974?
The Health and Safety at Work etc.Act 1974 (HSWA) is the primary legislation in the UK that sets out the framework for ensuring workplace health, safety, and welfare, placing duties on employers, employees, and others to do what is reasonably practicable to protect everyone’s health and safety.
What is GDPR?
The General Data Protection Regulation (GDPR) is a comprehensive data protection law enacted by the European Union (EU) that governs how personal data of individuals within the EU is collected, processed, and stored, aiming to enhance privacy rights and give individuals more control over their personal information.
The GDPR applies to personal data, meaning any information through which someone can be directly or indirectly recognised, such as name, identification number, location data or online identifier. Significant fines are applicable if firms do not comply with these regulations.
What are the benefits of cloud based storage systems?
Information is backed up securely on encrypted servers,
Accessibility can be managed via online settings,
Cloud systems are often cheaper than the costs of physically storing and managing files,
It is convenient to send and share files online instead of mailing physical copies,
Cloud systems are environmentally friendly,
Multiple users can access the same documents,
Documents and folder systems can be synchronised,
Who are the key persons outlined within GDPR?
Controller — The controller is the natural person or legal entity that determines the purposes and means of the processing of personal data (e.g., when processing an employee’s personal data, the employer is considered to be the controller).
Processor — A natural person or legal entity that processes personal data on behalf of the controller (e.g., a call centres acting on behalf of its client) is considered to be a processor. At times, a processor is also called athird party.
Data Protection Officer (DPO) — The Data Protection Officer is a leadership role required by EU GDPR. This role exists within companies that process the personal data of EU citizens. A DPO is responsible for overseeing the data protection approach, strategy, and its implementation.
What are the 8 individual rights under GDPR?
The right to be informed
The right of access
The right of rectification
The right to erasure
The right to restrict processing
The right to data portability
The right to object
Rights of automated decision making and profiling
What are the 7 principles of GDPR?
Lawfulness, fairness and transparency.
Purpose limitation.
Data minimisation.
Accuracy.
Storage limitation.
Integrity and confidentiality (security)
Accountability.
What things must companies put in place to ensure GDPR compliance?
- Raise awareness across your business
- Audit all personal data
- keep an up to date privacy notice
- Review procedures supporting individuals’ rights
Identify and document the legal basis for processing personal data under the GDPR
Review they seek, obtain and record consent
What is workplace diversity?
Diversity in the workplace relates tothe acceptance and inclusion of employees of all backgrounds.
Ensuring diversity in the workplace is an important asset of an organisation as it acknowledges the individual strengths of each employee and the potential they bring.
What are some advantages of a diverse team?
Increased productivity: A diversity of talent will result in a broader range of skills amongst the team and result in increased productivity
Increased creativity: Differing skill sets and perspectives within the team will increase the change of generating solutions to workplace problems
Improved cultural awareness: A diverse range of cultures within the workplace allows companies to operate more effectively within a global market place. For example, having access to an employee who speaks Mandarin will be a great asset for a company operating in China
A positive reputation: Companies that have a diverse workplace are often perceived as better employers. Potential employees want an employer who accepts and is tolerant of all backgrounds and who treats their employees fairly
Please explain your understanding of inclusion within the workplace?
Inclusion within the workplace is creating an environment and culture where all company employees feel like they belong in the organisation
This results in every employee being comfortable to voice their opinions and that no one person feels excluded on the basis of their identity
What is meant by the term unconscious bias?
Unconscious bias refers tothe associations and assumptions that a person may have about someone solely because of their race, gender or disability
These judgements are made without conscious awareness
These automatic assumptions and stereotypes are a major contributor to a lack of workplace diversity
What procedures does your firm implement to promote sustainability?
Recycling
Use of Energy efficient lighting (motion sensors)
Energy efficient equipment (LED lamps, energy efficient monitors)
All fleet vans are to EV - EV salary sacrifise scheme introduced for employees
Cycle to work scheme
Secondary Glazing to Office
Reduce printing by using cloud based systems
What is the Paris Agreement?
The Paris Agreement isa legally binding international treaty concerning climate change
It was adopted by nearly every nation and came into affect in 2016
The goal of the Paris Agreement is to limit global warming to well below 2 degrees Celsius whilst targeting levels below 1.5 degrees Celsius when compared to pre-industrial levels
The agreement commits all major emitting countries to cut their climate pollution
Name some sustainable building methods?
Use of recycled materials such as reclaimed timber, recycled tiles and plastics
Ground Source Heat Pumps
Air Source Heat Pumps
Solar Panels
Wind Turbines
Solar Shading
Rain water harvesting
Green Roofs
Heat Recovery
Can you explain your understanding of the term carbon neutral?
Carbon neutrality is to have a balance between the carbon emitted and the carbon absorbed from the atmosphere in carbon sinks
This is an important measure of the impact that businesses and projects have on the environment and global warming
To date no artificial carbon sinks are able to remove carbon from the atmosphere at the levels required to off set global warming
What are the benefits of a BREEAM certified building?
BREEAM buildings help clients to benefit from lowering the running costs of their built assets and minimising the impact on the environment through consideration at planning, design, construction and operation phases
Other benefits include greater marketability to building tenants through lower running costs and creating desirable places to live and work
A higher building value and positive PR message is also achieved through the increased sustainability of the building particularly when achieving BREEAM excellent and very good ratings
What sustainable initiatives are you aware of that are implemented by the RICS?
SKA ratings encouraging green codes of practice for commercial properties
RICS has launched the Value the Planet campaign and committed to forming a climate change expert panel to implement the UN’s sustainable development goals.
RICS has also launched a Responsible Business Report filled with solutions for companies to operate in a greener capacity, regardless of the firm’s size. This includes introducing higher recycling rates and reducing energy, transport and water use where possible.#
What things do you implement to promote sustainability?
Print only when necessary
Car sharing
Use of energy efficient equipment
Recycling
Cycle to work
Careful to minimise waste
Avoid use of plastic bottles where possible
Use of cloud based sharing systems
What is the difference between RICS ethics and rules?
- Ethics are a set of morals
- Rules of conduct are a framework that we work to.
What is the Mission Statement of the RICS?
- To qualify and equip their members to offer the highest standards of professional service.
- To promote and enforce standards.
- To lead solutions to the major challenges facing the built environment through professional expertise.
Your brother-in-law is a chartered surveyor . You find out that he is working outside of the RICS Rules of Conduct. What do you do?
- I would verify the facts and confront him to remind him of duties as a member of the RICS.
- I would inform the RICS specifying my relationship to the person and any corrective action which I believe he is committed to putting in place.
In the case of a breach of the rules of conduct, what is the procedure?
- Not every shortcoming will necessarily give rise to proceedings.
- A formal investigation by the Head of Regulation of the RICS is the first step in the process.
- The RICS can request information and/or visit and inspect to investigate compliance.
- Members must cooperate fully with all enquiries.
How can disciplinary proceedings be issued?
- Someone complaining to the RICs
- An Allegation by a Client or Third Party
- Information received or established by the RICS
What are the three actions can be imposed after the end of the investigation stage? (disciplinary)
- Fixed Penalty (A Fine)
- Consent Order
- Disciplinary Panel
What are Consent Orders? (disciplinary)
It is a written agreement between the RICS and a member or firm concerning a disciplinary issue on a breach of the RICS Rules.
It can require the member to take certain corrective actions, or restrain from taking certain actions for a specified period of time and may require the payment of a fine or costs.
When is a disciplinary panel applicable?
- They are used for more serious breaches of conduct.
- The panel will usually be held in public.
- The burden of proof is on the RICS.
- A balance of probabilities approach will be adopted.
What sort of breaches would expulsion be suitable for?
- Gross, persistent or willful failure to comply with an RICS Rule of Conduct.
- Fraud, dishonesty, conviction of a serious criminal offence, gross incompetence, deliberate discrimination, misappropriation of a clients money.
What insurances would you need if you were starting up on your own firm?
- Professional Indemnity
- Employers Liability
- Public Liability
- Buildings Insurance for an office premises
What sort of information do registered firms have to send to RICS annually?
An Annual Return, completed online
It Includes
- Type of Buisness and Staffing
- Nature of Clients
- Training Provision
- Complaints handling procedures details and records
- PI Insurance details
- Whether the firm holds clients money
Failure to do so leads to a fixed penalty.
What processes do regulated firms need to put in place when handling Clients Money?
Preserve the security of clients money which does not belong wholly to the company.
Client money must be kept in a clearly identifiable client account, which has client in the name of the bank account.
A principal overseas the client money accounting functions and a segregation of duties for employees must be established, the principal cannot override control measures.
Clients must always have access to their funds, a client money ledger must be maintained.
Accounting systems and data must be kept secure.
What are the different types of client money accounts?
- General Accounts - Hold Money for More than one Client
- Discrete Accounts - Reference a single named client.
Tell us about the Merrit v Babb Case Law
- This case dates back to 2001 and highlights the importance of having run-off cover in place.
- A Surveyor was sued for negligence by a former client.
- Because the surveying firm was no longer in existence, therefore the individual surveyor was pursued for damages successfully.
- This caused a big shock in the industry and highlighted the ned to ensure that run-off cover is in place for all previous employees.
What is an independent redress scheme?
- It is a consumer scheme designed to handle small issued that would be disproportionally expensive to take to court.
- If the scheme judges in favour of the complainant, it is binding.
- If it judges in favour of the firm, the complainant can escalate the matter to court.
- RICS firms must specify which redress scheme they want to use, it could be an ombudsman, arbitration or sometimes adjudication.
- A complainant can choose to take a matter to court without utilising a redress scheme if they wish.
What do you do if you receive a letter of complaint?
- I would acknowledge receipt and I would forward it to my firms designated complaint handler, as per our complaint handling procedure, providing information as required.
- As we do not provide advice to others, the process in my firm is different to a consultancy, complaints would usually relate to payment, quality or defect rectification requests.
- I would highlight the importance of informing our professional indemnity provider, if required to do so under the policy, however this is outside of the control of my role at my firm.
What must a complaints handling procedure include?
- The RICS provides a model form
- The Process must include a redress mechanism
- Details of the policy should be issued to a client within the terms of business.
- It must be clear, quick, transparent and impartial and free of charge within the first stage.
- Name and contact details of the investigating person must be stated.
- The complaint must be investigated within 28 days.
- All complaints, their progress and outcomes must be recorded.
- We must note the need to advice PI insurers of a complaint immediately.
The Process must have two stages as a minimum - Stage 1 - is where there needs to be consideration of the complaint by senior member of the firm or a complaints handling officer.
- Stage 2 - if the issue is not resolved, the complaint is referred to an independent third party with authority to award redress.
When does a Construction Project Require an F10?
A construction project is required to submit an F10 if it meets any of the following criteria:
- The project is expected to last longer than 30 working days
- The project is expected to exceed 500 workdays between individual workers
- More than 20 workers will be working on the project at any point
if an F10 is required, when should it be submitted?
as soon as is practicable before the construction phase begins
What is the Penalty for failing to comply with the Health and Safety at Work Act 1974?
Imprisonment for a term not exceeding two years, or a fine, or both.
What is the purpose of the Joint Names on a Client Account
For the purpose of Dual Authorisation
What are Continuous CPD Requirements?
Members must undertake and record appropriate lifelong training
On required from the RICS they must provide evidence that they carried out the CPD to maintain and improve their level of professional competence.
What type of articles do you read?
I am subscribed with a number of specialist Construction and Development Law firms and regularly receive updates and invites to webinars on Various construction law topics including Adjudication and new Case Law.
I also read the RICS Construction Journal, with particular interest on the recent article on 3C v Lidl.
I am also subscribed for updates from BCIS and I keep up to date on the RICS all of profession news letter and website updates.
What is the Future Home Standards?
The Future Homes Standard is a set of regulations that will make new homes in England more energy efficient and reduce their carbon emissions.
It is expected to be implemented in 2025 will see new homes deliver 75% less carbon emissions than homes built under the current Building Regulations.
How will the Future Home Standards effect your work?
The Future Home standards will alter the construction materials and specifications typically used to achieve the enhanced efficiency.
The FHS aims to decarbonise new homes by focusing on improving heating, hot water systems, and reducing heat waste.
This will be achieved by replacing current technologies with low-carbon alternatives. For example, very high quality building fabric (structural materials, insulation etc.), triple glazing standards and low-carbon heating through heat pumps will replace their older, less efficient counterparts, PV & Waste water heat recovery.
Low Air Levels of Permeability
What is your CPD Strategy?
I meet with my manager twice a year to review my career development plan and objectives.
I use this to build a CPD strategy, I subscribe to events and research certain areas.
I am currently studying a Masters Degree in Construction Law and Dispute Resolution at Kings College London, which has already significantly widened my knowledge.
What benefit does PII provide for the professional?
- The professional is protected from financial losses
- The firm does not have to meet the claim from their own assets or resources
What benefit does PII provide for the client?
They are bale to recover their financial losses.
What is the PII limit of uninsured Excess
Cover upto £500k - upto 2.5% or £10,000 Max
Cover Over £500k - upto 2.5%
What are the requirements for PPI set out by RICS?
- The Policy cover must be on an ‘Each and Every’ Claim Basis
- The RICS sets out minimum levels of indemnity based on turnover
- The RICS sets out maximum uninsured excess dependant on indemnity limit.
- Run Off Cover must be in place for at least 6 years.
- The policy should include cover for past and present employees, directors and partners.
What measures should be taken to try and avoid PI Claims?
- Keep full and detailed records of meetings and conversations
- Record recommendations and advice given
- Use proper letters of engagement, scope o services and terms of engagement.
- Don’t advice on specialism outside your field of experience.
- Use RICS guideline.
- Avoid poor management and excessive workloads.
If you made a mistake on a cost plan, what would your insurance company expect?
For you to notify them and comply with any conditions & procedures set out in the insurance policy.
If an estimate prepared by a QS is incorrect, can the client claim damages?
An estimate that is incorrect in itself will not provide the client with a sign of redress.
The client must demonstrate that the QS warranted the accuracy of the estimate or that it was incorrect due to lack of reasonable skill and care.
It could have been incorrect due to reasons outside the control, example - market conditions or an item referred to in their exclusions.
How can you limit your liability when agreeing terms of an appointment with a client?
- Base your appointment on reasonable skill and care as this is less onerous than fitness for purpose.
- Include a liability limitation clause beneath your PI cover limit.
- Run Off Cover must be in place.
- Sign agreements under hand as this will only have 6 year liability limitation rather than a deed.
Tell me what you understand about conflicts of interest?
- A conflict of interest is where someone in a position of trust has compelling personal or professional interests making it difficult for them to fulfil their duties impartially.
- An existing relationship will result in reduced impartiality and Chattered surveyors have an obligation to make clients aware of this and if necessary, decline work opportunities where a conflict of interest occurs.
How could the conflict of interest be managed internally if two separate departments were working for the same client?
- I could put in place procedures to ensure exclusivity of staff.
- This would avoid any cross over of information between the departments.
- I would also ensure that there are separate communication lines into the client.
- Separate geographical locations and secure office and data storage would also need to be provided.
- Staff could also sign up to confidentiality or non-disclosure agreements.
- I would also need to monitor the potential conflict and keep the client updated on progress.
If the client was insistent that you worked for them despite an existing conflict of interest, how would you proceed?
- I would check the clients understanding around the conflict of interest.
- I would then make the client aware of the potential for reduced impartiality.
- If they were still insistent on the appointment, I would seek a letter of instruction from the client to
continue. - Following the appointment I would agree working procedures to manage the conflict of interest with the client and the teams involved.
Under the Bribery Act, under what circumstance is a facilitation payment permitted?
- The only circumstance in which it is OK to make a facilitation payment is when you are under duress.
- For example if there is a real and present risk or danger to “life, limb or liberty”.
- If you or your companions are under immediate physical threat.
- You should put safety first, make the payment and report the matter immediately.
- Or as soon as is practicable to your manager or your ethics compliance contact.
You receive an invite to attend the Theatre with some members of your Project Team but they dropped out due to illness at the last minute, would you still attend?
- In the first instance I would declare this hospitality on my companies gifts and hospitality register.
- Assuming the invite was approved and I was authorised to attend, I would need to decline the invite due to the Project Team dropping out.
- Since they won’t be present, this will not be a genuine business event.
- Consequently, I would decline this hospitality at the Project Team’s expense.
A contractor invites you to lunch to a restaurant and advises they’ve got two Michelin stars and a wine list second to none. They say they are keen to discuss the details of their tender they are about to submit for the project you are working on. How would you respond?
- Going to what sounds like a lavish lunch paid for by a bidder in the middle of a tender process is against Company policy and could be an offence under the UK Bribery Act.
- If this were the first time, it would be OK just to decline and explain that such an invitation is inappropriate.
- However if this supplier is persistent, there is a red flag in that he wants to discuss things that he cannot put in writing, so we should report this infringement.
What is the difference between management and financial accounts?
- Management accounts are for the internal use of the management team.
- Financial accounts are the company accounts that are required by UK law.
What is the difference between a profit and loss account and a balance sheet?
A profit and loss account shows the incomes and expenditures of a company and the resulting profit or loss.
The balance sheet shows what a company owns (it’s assets) and what it owes (it’s liabilities) at a given point in time.
What is a cashflow statement?
- It is the summary of the actual or anticipated ingoing and outgoing of cash in a firm over the accounting period.
- It measures the short-term ability of a firm to pay off its bills.
What are Capital Allowance’s?
(Accounting Principals)
Tax relief on certain items purchased for the business for example tools and equipment.
What are Sinking Funds?
(Accounting Principals)
Funds that are set aside for future expense or long-term debt.
Define Insolvency?
An inability to pay debts where liabilities exceed assets.
Explain your understanding of Companies House?
An agency that incorporates and dissolves limited companies within the United Kingdom
What are Liquidity ratios?
Liquidity rations measure the ability of a company to pay off its current liabilities by converting its current assets into cash.
Liquidity ratio calculation = current assets / current liabilities.
- The ratio is usually around 1.5 but it depends on the sector of activity.
- For example house builders often operate on a liquidity ratio over 3 because they retain high value assets in the form of unsold houses.
- A liquidity ratio of less than 0.75 can be an early indicator of insolvency.
What is the purpose of a P & L?
Profit & Loss
◦ To monitor and measure profit (or loss).
◦ To compare against past performance and against company budgets.
◦ For valuation purposes and to compare against competitors.
◦ To assist in forecasting with future performance.
◦ To calculate taxation.
To show the position of Sales Income Minus cost.
What is the difference between debtors and creditors?
On a Balance Sheet, the Creditors balance are firms or individuals owed money by the company.
For example - if you have provided services to a client and they owe payment of your fees, you become a creditor to that client.
On a Balance Sheet, the Debtors balance are firms or individuals which owe the company money.
For example - if you have used a sub-consultant and still owe them payment of their fees then you become a debtor of the sub-consultant.
What are Management Accounts?
- The accounts prepared by a company for internal management use.
- Accounts prepared for a lender, such as a bank to evaluate how you will be able to repay the funding
- These accounts are not be audited externally.
What is a Financial Statement?
Forecasts of income and expenditure that can be used as an analytical tool to identify potential shortfalls and surpluses.
What are Profitability ratios?
- Profitability ratios measure the performance of a company in generating its profits.
- The trading profit margin ratio = Turnover - (cost of sales/turnover)
- Low Margins maybe due to growth strategy from the company and do not always result from bad management.
What are Financial Gearing Ratios?
- Measure the financial structure of the company which are crucial indicators for the external suppliers of debt and equity as well as for internal management.
◦ They help to measure solvency.
◦ Highly geared companies rely mainly on borrowing.
◦ The payment of interest reduces the profit.
Why do chartered quantity surveyors need to understand and be able to interpret company accounts?
◦ To aid in preparing their own business accounts.
◦ For assessing the financial strength of contractors and those tendering for contracts.
◦ For assessing competition.
What is a cashflow forecast?
A cashflow forecast summarises the amount of cash entering and leaving a company or project.
On construction projects, cashflows typically show an S curve.
What is an S Curve?
S Curve, is a term which refers to the standard shape of cashflow expenditure when presented graphically for construction projects.
The rate of expenditure starts slow during the preparatory works
The rate of expenditure typically increases significantly during the middle of the program
And slows down towards the end to reflect the reduced expenditure for finishing works compared to structural and M&E in middle.
Why would surveyors review balance sheets, P&L and cashflow forecasts?
- To track, analyse and access business accounts and performance (during due diligence and the course of the works)
- For assessing the financial strength of contractors.
- To compare actual progress of the work against pre-contract predictions.
- For preparing future expenditure forecasts (reviewing old cashflows)
What are Escrow Accounts?
◦ A separate account owned by a third party, held on behalf of two other parties.
◦ A bank account with defined contractual conditions for the release of funds.
◦ They can be used as a project bank account.
◦ Mechanisms must be in place for the release of funds such as payment certificates.
When have you used company accounts in your work?
To assess the financial strength of contractors at Pre-Qualification Stage and tender stages.
How do you analyse a company’s accounts?
◦ The client’s accountants will carry out the detailed analysis but I can look at the warning signs by calculating ratios such as liquidity ratios, profitability ratios and gearing ratios.
◦ I should always calculate the ratios myself as those included in the company accounts may have been manipulated.
How do you carry out a credit check? Give an example.
◦ I use the Experian website to which my company subscribes to access ratings for all companies.
◦ I considered both the group/parent accounts and the company accounts.
◦ If the credit rating is low, I pass on all the information to my client’s accountants for them to analyse further.
What are signs of insolvency in company accounts or credit checks?
- A low credit rating.
- A liquidity ratio below 0.75.
- A falling working capital suggests the company has taken on more contracts than it can finance.
- A low return on equity.
- A highly geared company that is heavily reliant on loans.
- A falling cashflow statement.
Why would you not recommend the appointment of a contractor with a low credit rating?
◦ There may be an increased risk of the contractor not performing satisfactorily.
◦ It could present increased risk of the contractor failing to deploy sufficient resources and materials to the project.
◦ It could increase the risk of the contractor’s insolvency.
What measures would you recommend if your client wanted to appoint a contractor with a low credit rating?
- I would explore the option of requesting a performance bond that my client could call on if they Main Contractor failed to perform.
- I would also review the tender submission to ensure this is not excessively front loaded.
- When reviewing interim valuations, I would ensure that these are accurate and not over claimed.
- A project bank account may also provide an additional level of assurance and should be considered.
What is a SWOT analysis?
- A SWOT analysis can be used to analyse the internal strengths and weaknesses and external threats and opportunities of a company.
- This is carried out with a view to exploiting strengths and opportunities and mitigating weaknesses and threats.
What is a PEST analysis?
This is a structured method of analysing the key factors influencing market conditions.
These factors are:
◦ Political influences.
◦ Economical influences.
◦ Socio-demographical influences.
◦ Technological influences.
◦ Environmental influences.
How do companies write a business plan?
◦ They undertake an analysis of the market and industry to identify business opportunities and critical success factors.
◦ Companies should focus their resources in developing their competences in the critical success factors.
◦ This then leads to the development of goals and objectives with their associated strategies and actions.
What is a Client Account Planning session?
◦ A review of current workload, resources & fees.
◦ It involves the identification of key client personnel who have influence over job opportunities and identification of who the firm should look to build relationships with.
◦ A review of pipeline opportunities with that client is also undertaken.
What is a Business Plan?
◦ A formal statement of the business’s goals with reasons why they are thought to be attainable and the plan for reaching the goals.
◦ The business plan also provides employers with a common ground to focus upon.
Would you be able to interpret & understand an annual account?
At a high level but I would seek further advice from one of our internal Chartered Accountants if necessary.
What is your firms business plan?
◦ To be the development partner of choice, creating high quality tenure blind homes.
◦ Strong Turnover growth following extensive investment in new divisions over recent years.
◦ To be developing 1200 homes per annum within the next 5 years.
◦ Expansion into new London Regeneration projects within the next 5 years.
◦ See Turnover grow to £400m in the next 5 years time.
How do you contribute to your company’s goals?
◦ Maintain excellence in my work.
◦ Do my best to ensure high levels of construction quality.
◦ Sharing knowledge within integrated teams.
◦ Keeping up with new technologies.
◦ Upskilling new and junior team members.
How do you think an up to date business plan can help an organisation in the current economic climate?
◦ To support with gaining additional investment, funding or finance.
◦ To ensure the business scales and adapts to changing market conditions , such as sales demand and affordability, this is essential in housebuilding.
◦ To focus on key priorities.
◦ To review and update budgeting.
What is your understanding of the term Confidentiality?
Where information is provided but is subject to confidence and not shared without permission.
What is your understanding of the term Meta Data and why is this important?
◦ Meta Data is information about a specific piece of data.
◦ For example when sharing a cost planning document, the Meta Data associated with this could consist of information about the author, the file size, the date the document was created and keywords to describe the document.
◦ We must ensure that this Meta Data is afforded the same level of care as all other confidential data.
◦ In a scenario where we are sharing a document or removing confidential components of a document we should ensure that any confidential meta data is not shared inadvertently.
What is your understanding of Intellectual Property and Copyright?
◦ This is the right to control the use and ownership of original works.
◦ Work generally created by an employee usually belongs to their employer unless copyrights are put in place.
◦ It is common within construction for a client to be granted license for use and reproduction of copyright material which should be clearly defined.
◦ This could be the right to use a particular design by a subcontracting specialist who retains control of the original copyright.
What is the Freedom of Information Act 2005?
◦ This is the primary piece of UK legislation that controls the access to official information.
◦ The act permits the public right of access to information held by public authorities.
◦ Information must also be published through the public authorities publication scheme.
◦ The act covers all information held and not just information since the act came into effect.
What are the benefits of cloud-based storage systems?
◦ Information is backed up securely on encrypted servers.
◦ Accessibility can be managed via online settings.
◦ Cloud systems are often cheaper than the costs of physically storing and managing files.
◦ It is convenient to send and share files online instead of mailing physical copies.
◦ Cloud systems are environmentally friendly.
◦ Multiple users can access the same documents.
◦ Documents and folder systems can be synchronised.
Who are the key persons outlined within GDPR?
Controller - The controller is the natural person or legal entity that determines the purposes and means of the processing of personal data for example when processing an employee’s personal data, the employer is considered to be the controller.
Processor - A natural person or legal entity that processes personal data on behalf of the controller for example a call centre acting on behalf of its client is considered to be a processor.
Data Protection Officer (DPO) - The Data Protection Officer is a leadership role required by EU GDPR. This role exists within companies that process the personal data of EU citizens. A DPO is responsible for overseeing the data protection approach, strategy, and its implementation.
What are the 8 individual rights under GDPR?
◦ The right to be informed.
◦ The right of access.
◦ The right of rectification.
◦ The right to erasure.
◦ The right to restrict processing.
◦ The right to data portability.
◦ The right to object.
◦ Rights of automated decision making and profiling.
What is the Data Protection Act 2018?
The act replaces previous 1998 Legislation and manages how personal data is processed by organisations
and the government.
It is the UK legislation for the implementation of the EU General Data Protection Regulations (GDPR).
What are the key Principles of the Data Protection Act 2018?
The act ensures that data is:-
◦ Used fairly, lawfully and transparently.
◦ Used in a way that is adequate, relevant and limited to only the purpose it is intended.
◦ Is retained for no longer than is necessary.
◦ Processed securely including the protection against unlawful use, loss or destruction.
What are a person’s rights under the Data Protection Act?
◦ People have the right to:-
◦ To be informed about how their data is being used.
◦ The right to access their data.
◦ The right to have incorrect information updated.
◦ To have their data erased.
◦ To stop or restrict the processing of their data.
◦ The right of portability.
◦ To object to the use of their data.
What different sources of information do you use in your day-to-day?
◦ Cost Data highly sensative to my Client (the firm)
◦ Access Controlled servers and drives
◦ If signed up to an NDA with a client I ensure complete confidentiality and am not able to talk about these projects with colleagues who are not party to the project.
◦ I am always sure to lock my computer when away from my desk and comply with my firms IT security policies for example attendance at Cyber security courses and regularly updating my passwords.
◦ If I am sharing or processing information not available in the public domain from a previous project 1 always obtain the clients written permission to do so.
◦ We do not store hard copies of information.
How do companies ensure compliance with the Data Protection legislation generally?
◦ They should only retain data they need to perform their day-to-day operations.
◦ If they are retaining someone’s data they should ensure the person is kept informed and advised on why they have it.
◦ They should hold the data securely.
◦ They should also keep the information up to date and delete information they no longer need.
Describe the role of a Principal Designer under the CDM Regulations?
◦ Plan, manage, monitor and coordinate health and safety (pre-construction).
◦ Identify, eliminate or control foreseeable risks.
◦ Ensure Client and designers are aware of their duties and advise the Client on bringing together the pre-construction information.
◦ Provide relevant information to other duty holders.
◦ Liaise with Principal Contractor in the planning management, monitoring and coordination of the construction phase.
Describe the role of a Client under the CDM Regulations?
◦ Appoint competent duty holders.
◦ Allow sufficient time and resources.
◦ Prepare and provide relevant information to duty holders.
◦ Ensure that the Principal Designer and Contractor carry out their duties.
◦ Ensure welfare facilities.
Who are duty holder under the CDM Regulations?
Nearly everyone is a Duty Holder
- Commercial Clients
- Domestic Clients
- Designers
- Principal Designers
- Principal Contractors
- Contractors
- Workers
What are the key implications of the CDM Regulations?
◦ There is more focus on clients to put in place arrangements to ensure health and safety.
◦ Clients can no longer assign their legal responsibilities to agents.
◦ There must be a declaration of how long contactors will be given to plan and prepare for construction work.
* Clients are deemed to assume the role of the principal contractor for any period during which other appointments aren’t made.
What items would you expect to find in the pre-construction information?
◦ A project description.
◦ The Client’s considerations and management requirements for hoarding, welfare facilities, traffic restrictions and permits to work.
◦ Environmental restrictions and existing on-site risks such as site restrictions, previous H&S files, ground conditions, existing services, asbestos surveys, contamination and unsafe structures.
◦ Significant design and construction hazards such as design risks assessments, suggested method statements, arrangement for coordination post contract design work and changes.
◦ Health and Safety File requirements
What would you find in the Construction Phase Plan?
◦ A Project description.
◦ Processes for management of the works including site inductions, training, communication, welfare facilities, design coordination, site rules and emergency procedures.
◦ Arrangements for controlling significant site risks such as handling of deliveries, working at height, deep excavations, preventing falls, site segregation, maintenance of plant and equipment, removal of asbestos, reducing noise and vibrations and manual handling.
What would you find in the H&S File?
H&S information that is useful for the planning of future works or maintenance.
This comprises:-
◦ A brief description of the work carried out.
◦ Any residual hazards which remain and how they have been dealt with for example surveys or other information concerning asbestos, contaminated land, water bearing strata and buried services.
◦ Key structural principles for example, bracing and sources of substantial stored energy.
◦ Hazardous materials used for example lead paint, pesticides, special coatings which should not be burnt off.
◦ The nature and location of significant services, including underground cables, gas supply equipment and fire-fighting services.
What is an F10?
◦ The F10 form is used to notify the HSE of the project.
◦It should contain:-
◦ The address of the construction site.
◦ The name of the local authority where the site is located.
◦ A brief description of the project and the construction work it entails.
◦ Contact details for the client and Principal Contractor.
◦ It should give an indication of the time allowed by the client for the PC to plan and prepare for the construction work
◦ It should provide a planned date for the start of work, duration of construction phase and give a number of people at work on site at any one time.
What does RIDDOR stand for?
Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 2013
(RIDDOR) requires the responsible person’ to notify any death, reportable injury, diseases or dangerous occurrence to the HSE.
The responsible person is the employer or, for the self employed, the contractor or principal contractor.
What incidents are reportable?
RIDDOR
◦ Death and major injuries such as
- loss of consciousness or loss of a limb.
◦ Occupational diseases.
◦ Dangerous occurrences for example explosions, hazardous substances, structural collapse or collision etc.
* Gas incidents.
What does COSHH stand for?
Control of Substances Hazardous to Health
The regulations aim to avoid exposure to hazardous substances, or if not possible, to control exposure by measures that are proportionate to the health risk.
What does CSCS stand for?
Construction Skills Certification Scheme
On the project described in your case study, what measures did you or your company take to ensure good standards of health and safety when either undertaking your work or delivering the project?
◦ Working to agreed risk assessments.
◦ Wearing personal protective equipment on site.
◦ Attending Site Inductions.
◦ Reporting visible risks for example - traffic management issues.
What is a risk assessment?
◦ A risk assessment is simply a careful examination of what, in your work, could cause harm to people, so that you can weigh up whether you have taken sufficient precautions or should do more to prevent harm.
◦ The law does not expect you to eliminate all risk, but you are required to protect people as far as “reasonably practicable”.
What are the 5 steps to risk assessment?
Step 1 - Identify the hazards.
Step 2 - Decide who might be harmed and how.
Step 3 - Evaluate the risks and decide on precautions.
Step 4 - Record your findings and implement them.
Step 5 - Review your assessment and update if necessary.
What is the role of the HSE?
◦ To prevent work-related death, injury and ill-health.
◦ Provide support to the public and businesses with guidance, statistics and research.
What are the powers of the HSE?
◦ Inspectors can visit site without notice, talk to workers, take pictures and samples.
◦ Most inspections are planned to encourage good H&S practices.
◦ Some inspections are to respond to a complaint or follow-up an investigation.
◦ To impose sanctions including stop and improvement orders.
◦ To issue written or verbal information and advice.
What is your company’s Health and Safety policy?
◦ Prevent work-related injuries or illnesses.
◦ Prevent damage to property and/ or equipment from our activities.
◦ Prevent adverse impacts to the environment from our ongoing projects or operations.
◦ At staff level:-
◦ Take responsibility for safety and comply with safe systems of work.
◦ Act responsively, report incidents and near misses.
◦ Regular training refresher courses.
◦ Risk assessments are compulsory for all projects with bi-monthly updates as a minimum.
◦ CSCS cards are mandatory.
What is the RICS Surveying Safely publication?
The RICS proffesional standard on personal safety at work.
The document covers:-
1) General Statement - Employers/Employees have a duty of care under law of tort towards those who may be affected by their actions.
2) Safety of Employees - actions that must be taken by employers. Special duty of care towards young trainees.
3) Workplace - Fire & First Aid provisions.
4) Hazards and Risk Assessment requirements.
5) Visiting Sites - PPE, Lone working, Access provisions.
6) During Site Visits - Key hazards assessments including structures, roofs and contamination.
7) Safety of you and others - Everyone is to take responsibility of their own health & safety.
8) Legal Duties - Criminal Liability and CDM guidance.
The construction industry is notorious for accidents and death on site and death; what measures are there to prevent this occurring?
There are various ways to prevent accidents on construction sites:-
1) Eliminate the risk of accidents occurring at the source for example … assembly on the ground instead of working at height.
2) Planning & programming of works.
3) Allowing sufficient time for the works to be constructed effectively.
4) Carrying out risk assessments, method statements & educating workers.
5) Training inductions & CSCS qualifications.
6) Ensuring safe working sites and access & egress points.
Which accident kills the most operatives in construction?
Falls from height.
What is the considerate contractors scheme?
CCS was set up in 1997 & is responsible for improving the image of construction.
It monitors all registered sites and ensures best practices are carried out in particular on items such as engaging with local communities and site cleanliness.
What is the Health and Safety at Work Act 1974?
It is the primary piece of legislation governing H&S in the United Kingdom.
It places a statutory duty on all employers to provide and maintain equipment and systems of works that are safe and without risk to the health and safety of employees, or others who may be affected by their undertaking.
The Act aims to:
◦ Secure the health, safety and welfare of people at work.
◦ Protect others against risks to health and safety arising from work activities.
◦ Control dangerous substances.
◦ Control of emissions into the atmosphere.
Employers with 5 or more employees must have written health and safety documents detailing the organisations health and safety structure.
What is the penalty for breach of the Health and Safety at Work Act?
Magistrates’ court - A fine of up to £20,000 or imprisonment for up to 6 months
Crown Court - An unlimited fine or imprisonment for up to 2 years
Very serious offenses - Up to five years in prison
Blatant disregard for employee welfare - Unlimited fines
Please explain to me your approach when negotiating in challenging
circumstances?
◦ In the first instance I undertake detailed research on the matters under consideration and form an opinion.
◦ I will then look to compile supporting documentation as substantiation to any claims.
◦ Following these initial steps I arrange an internal meeting with the client and project team to discuss negotiable items which can be conceded in addition to the non-negotiable items.
◦ If needed I will prepare a SWOT analysis to support decision making
◦ During negotiations I try to develop a partnering approach rather than an adversarial one.
◦ My attitude and ethos is that the project must be the winner not individuals.
What makes a successful negotiation?
◦ Preparation and collating supporting documentation.
◦ Each party should get the chance to present their case in a calm forum.
◦ Identification of bargaining positions and politely making proposals.
◦ A swift confirmation in writing on what was agreed at the meeting and confirmation on what items still need to be actioned and by whom.
◦ A confirmation of next steps to bring the negotiations to a close.
What happens during a negotiation meeting?
◦ Both parties should be allowed to discuss their position on the items being discussed and their reasoning for their position.
◦ All parties should look to maintain professionalism, remain calm, acting with respect and courtesy at all times.
◦ The meeting should take place ideally in a calm setting.
◦ Both parties should honour the agreements reached for the benefit of the project.
◦ Once the negotiation items are agreed they should be put in writing as soon as possible.
What are the four stages of negotiations?
- Preparation
- Exchanging Information
- Bargaining
- Finalising the Agreement
Consider the best interests of the project.
Can you tell me 4 strategies for negotiation?
Justify the Position - Individuals should come to negotiations ready to back up their position, including research and a commitment to reaching a deal.
Consider the Other Side - Remember that the other side has things it wants out of the deal, too. Individuals should determine what they can offer to help them reach their goals without giving away more than they want to or can afford.
Keep Emotions in Check - It’s easy to get caught up in the moment and be swayed by personal feelings, especially anger and frustration. However, emotions cause negotiators to lose sight of the goal.
Know When to Walk Away - Know what to accept as a minimum and when to walk away. If both sides are hopelessly dug in, pausing negotiations gives everyone involved a chance to regroup and possibly return to the table with a fresh perspective.
Please provide an example of when you had to handle difficult negotiations.
Dealing with the conflicted groundworks account at Harlow with contested variations of over £340,000
Please provide an example of your oral communication skills.
◦ I have been responsible for providing a number of professional presentations.
◦ I have held site meetings with multiple subcontractors and clients to discuss various issues & presented reports within the meetings.
◦ I also use my oral communication and written communication skills when dealing with day-to-day issues on the phone, within meetings and on video call.
What are your thoughts on using e-mail as a form of communication?
◦ E-mails carry the same legal value as a letter and contracts can be inadvertently created by e-mail.
◦ We must therefore be very careful with regards to the content and form of the e-mail communication.
◦ When issuing e-mails it is easy to become complacent as they are perceived as being informal.
◦ I am always sure to communicate in a professional manner even if other parties do not.
◦ I always make sure that I select the correct recipient and do not release someone’s e-mail addresses without their consent.
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Which forms of communication are you aware of?
◦ Verbal either in person or via telephone.
◦ Non-verbal such as body language, eye contact, gestures and appearance.
◦ Written for example e-mails and letters.
◦ Graphical information such as charts, diagrams and tables.
◦ Presentations.
◦ Video conference.
What are the barriers to effective communication?
◦ Verbal / mono-tone delivery or unclear delivery of speech.
◦ The over use of technical language that may not be understood by lay clients.
◦ Emotionally charged and heated conversations when parties are unable to listen.
◦ International language barriers.
◦ Disinterest and boredom.
◦ Prejudice.
◦ Bias.
◦ Interruptions and distractions.
◦ Background noise pollution.
◦ Poor call quality.
◦ Poorly maintained and adversarial relationships.
Name some different forms of Alternative Dispute Resolution?
◦ Mediation.
◦ Conciliation.
◦ Negotiation.
Name some formal methods of dispute resolution?
◦ Arbitration.
◦ Litigation.
◦ Adjudication.
