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RICS APC 2024 (Rural Pathway) > Ethics, Rules of Conduct and Professionalism > Flashcards

Ethics, Rules of Conduct and Professionalism Flashcards

1
Q

What is the RICS Moto?

A

‘Est Modus in Rebus’ - there is measure in all things.

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2
Q

When was the RICS founded?

A

1868

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3
Q

When did the RICS receive Royal Charter?

A

1881, granted by the Privy Council

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4
Q

What is the Royal Charter?

A

Granted by the Privy Council, gives RICS legal responsibility.

Requires RICS to promote usefulness of profession to advantage the UK public and other parts of the world.

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5
Q

Where are the RICS headquarters?

A

12, Great George, Parliament Square, London

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6
Q

What is the purpose of the RICS?

A

-Regulate and uphold standards
-Promote the industry
-Protect RICS businesses and Members
-Provide guidance + advice

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7
Q

What is the RICS mission statement?

A

-To qualify and equip members to offer highest standards of professional service.
-Promote and enforce standards.
-Lead solutions to major challenges facing the built environment through professional expertise.

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8
Q

What is the vision of the RICS?

A

-To act with integrity and champion the profession.
-To be recognised in key international markets as the leading body that develops and enforces standards.
-I do this by attending university careers events, promoting the profession, and ensuring I act with integrity.

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9
Q

What are the goals of RICS?

A

-Encourage younger members into the profession.
-Greater global coverage.
-Greater data protection.

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10
Q

What is Lionheart?

A

-Independent charity run by RICS, for RICS professionals and their families.
-Benevolent fund established for over 100 years.
-Provide financial, health, legal, and professional advice.

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11
Q

What is RICS Matrics?

A

-Supports new members entering the profession
-Working with RICS to shape the future of surveying, and grow the size + respect of the profession globally.
-Provide CPD sessions.
-Aim to provide for every city and nationally.

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12
Q

Why do you want to be a Chartered Surveyor?

A

To be a member of the largest property institution in the world would be a privilege.

I would like to promote best practices in the profession, and reassure clients that they are receiving diligent service.

There are also invaluable networking opportunities available through being a Member of RICS.

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13
Q

What are the RICS 5 Principles of better regulation and why are they relevant?

A

PACTT

Proportionality - penalties/actions must reflect scope/level of work

Accountability - to take responsibility for our actions

Consistency - promote confidence in profession

Targeting - much reach targeted audience to have desired effect

Transparency - to ensure fairness and accountability. Ensure regulations are easily interpretable.

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14
Q

How have you used one of the RICS 5 Principles of better regulation in your personal life?

A

Transparency - I will let people know my current workload and availability before I commit to making plans.

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15
Q

Can you describe the RICS logo?

A

White lion

Crown

Tongue sticking out

Purple background

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16
Q

How does RICS communicate with its members?

A

-News and insights (website/Modus)
-Issuing professional standards (guidance notes and professional statements
-Training events
-Products/Services (iSurv)

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17
Q

What information barriers does your firm have in place?

A

-Restricted access to files
-Clear desk policy
-Private meeting rooms
-Must lock screen when AFK.

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18
Q

What would you do if you received a gift from a client?

A

-I would consult the RICS ethics decision tree and my firms anti-bribery procedure.
-I would consider the RICS professional statement countering bribery, corruption, money laundering and terrorist financing (Feb 2019).

P - Proportionality, does the gift seem proportional
V - Value, my firm have a £30 gift limit
I - Impartiality - does is affect my ability to act impartially?
T - Timing, is it coincidental timing?

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19
Q

If a gift was deemed appropriate, how would you proceed?

A

I would record it on my firms Gifts and Hospitality Register.

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20
Q

What would you do if you were asked to do something unethical?

A

Speak to a senior colleague or the designated individual as set out in my firm’s Whistleblowing Policy.

Report it to the relevant authority - e.g. for money laundering, the MLRO.

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21
Q

Can you give me an overview of the RICS governance structure?

A

Corporate governance structure shaped by Royal Charter, Bye-Laws, and Regulation.

Combines governance bodies, executive team, and presidential team.

RICS is self-regulated an internally monitored.

Bye-Laws determine how RICS is regulated.

The Governing Council manage and set RICS strategy. The regulatory board, audit committee and management board execute this.

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22
Q

What is BCIS?

A

Building Cost Information Service

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23
Q

When might you need to use BCIS?

A

For a reinstatement valuation.

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24
Q

What is the Client Money Protection Scheme?

A

A scheme operated by RICS containing provisions to reimburse members of the public for their direct loss of funds when using a regulated firm.

Provided through an RICS insurance policy.

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25
Q

RICS firms that operate a client money account must…?

A

-Set clear segregation of duties for employees.
-A principal must oversee the accounting functions.
-Principals cannot override controls.
-Competent staff to process client’s money with cover provided for long term absence.
-Client must be in account name, and must be separate.
-Client must always have access to funds.
-Bank details must be passed to client.
-Account cannot go overdrawn.
-Maintain ledgers and running balance.

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26
Q

Explain what must be included in a Complaints Handling Procedure?

A

-RICS provide a model form
-Process must include a redress mechanism
-Policy details should be issued with the ToE.
-Must be clear, quick, transparent, and free at the first stage.
-Details of investigating person must be stated.
-Must be investigated within 28 days.
-All outcomes must be recorded.
-PI insurers must be notified immediately.
-Process must have 2 stages.

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27
Q

What are the 2 CHP stages?

A

1 - Consideration of the complaint by CHO or senior firm member.

2 - If not resolved, refer to ADR (Alternative Dispute Resolution) partner with the authority to reward redress. Complainant may be expected to contribute to costs here.

My firm refer ADR matters to the Property Ombudsmen.

RICS default ADR provider is The Centre for Dispute Resolution - RICS ADR Scheme

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28
Q

Give me a scenario where you have been offered a gift.

A

Just recently I took a phone call from a client asking advice on purchasing land with Overage.

It was a quick phone call so I did not charge. The client wanted to send me a bottle of wine for my help, however I politely declined. Although the value was minimal, I was not content with the timing and impartiality. Would I then ‘owe’ further advice?

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29
Q

When were the new RICS Rules of Conduct introduced?

A

Came into effect from 2nd February 2022

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30
Q

What were the main changes from the previous rules of conduct?

A

KEY - merging responsibilities and guidance for Members and Firms

To promote and enforce the highest ethical standards.

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31
Q

Rule 1 of the Rules of Conduct

A

‘Members and firms must be honest, act with integrity and comply with their professional obligations’

  • Be open and transparent regarding fees and services
  • Identify and deal with any potential Conflict of Interest
  • Must keep client money safe
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32
Q

Rule 2 of the Rules of Conduct

A

‘Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise’

  • SUK – Skill, Understanding and Knowledge before accepting instruction. Only undertake work on this basis.
  • Approved contractors!
  • CPD – all qualified members must log 20 hours per year (48 for APC candidates)
  • Must stay up to date with relevant legislation and RICS professional statements
33
Q

Rule 3 of the Rules of Conduct

A

‘Members and firms must provide good-quality and diligent service’

  • Understand client needs and objectives (private vs charity etc)
  • Keep accurate and up to date data
  • Effective communication channels and good response times
34
Q

Rule 4 of the Rules of Conduct

A

‘Members and firms must treat others with respect and encourage diversity and inclusion’

  • Treat everyone fairly and do not discriminate
  • Members and firms do not bully or harass anyone
  • Modern Slavery training etc
  • Cooperative team working, develop and inclusive culture
35
Q

Rule 5 of the Rules of Conduct

A

’ Members and firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession’

  • Respond and deal with complaints openly and professionally
  • Speak up if you have suspicions – whistleblowing policy in BNP (anonymous portal)
  • Ensure public statements are appropriate and instill confidence in the profession
  • Respond to complaints made against them promptly, openly, and professionally.
36
Q

What is Appendix A of the Rules of Conduct?

A

Professional Obligations to RICS

3 for RICS Members

7 for RICS-regulated firms

37
Q

Name the 3 Professional Obligations for RICS members

A
  1. Comply with CPD requirements
  2. Cooperate with RICS
  3. Provide all information reasonably requested by the Standards and Regulation Board
38
Q

Name the 7 Professional Obligations for RICS-regulated firms

A
  1. Must publish a complaints-handling procedure, which includes an ADR provider approved by RICS, and maintain a complaints log.
  2. Must have appropriate PI cover that meets the standards approved by RICS.
  3. Firms with a sole principal must make arrangements for their professional work to continue in the event of their incapacity, death, absence from or inability to work.
  4. Firms must cooperate with RICS.
  5. Provide all information reasonably requested by the Standards and Regulation Board.
  6. Firms must display on their business literature to denote that they are regulated by RICS.
  7. Firms must report to RICS any matter that they are required to report under the Rules for the Registration of Firms.
39
Q

What is the minimum PI cover?

A

Dependent on firms turnover.

£100k or less = £250k PI

£100 - £200k = £500k PI

£200k plus = £1m PI

My firm have PI cover of £5m

40
Q

What is the purpose of having PI cover?

A

To provide financial cover in the event a client suffers financial loss as a result of breach of professional duty, e.g. negligence.

41
Q

What is the maximum uninsured excess for PI?

A

PI up to £500k = the greater of 2.5% of insured sum or £10,000

PI over £500k = 2.5% of insured sum

42
Q

What was the outcome of Merrit vs Babb case law?

A

Shows importance of run-off cover.

A surveyor was sued for negligence by former client. The firm closed down and did not have appropriate run-off cover in place.

The surveyor was pursued for damages.

43
Q

What is your understanding of claims made basis?

A

The PI policy that was in place at the time at the time the breach is discovered is responsible for providing the indemnity, not the PI policy that was in place when the breach occured.

44
Q

Outline the PI requirements?

A

-Policy must be made on an ‘each and every claim’ basis.
-RICS set out minimum cover.
-RICS set out maximum uninsured excess.
-Policy to include cover for past and present directors and employees.

45
Q

What are the limitation periods for PI?

A

6 years when executed under hand.

12 years when executed as a deed.

This is the time someone has available to make a claim following the event.

46
Q

What is the RICS?

A

A professional body founded in 1868 of surveyors which regulates the activities of those professionals and aims to promote the highest ethical and professional standards in the industry.

47
Q

Who is the RICS President?

A

Tina Paillet FRICS

48
Q

What are the CPD requirements

A

20 per annum - 50% must be formal (48hrs for APC candidates)

Members must undertake learning on the standards expected around RICS Ethics on a rolling 3-year basis

All CPD must be recorded via the RICS online management system.

49
Q

Why did the previous Global Professional and Ethical Standards change?

A

-Been in place since 2007.
-To provide a single document for members and firms to refer to.
-There are also now clearer example behaviours.

50
Q

What is the procedure for starting up a regulated firm?

A

-Contact RICS for guidance and obtain a company start up pack.
-Register for regulation.
-Appoint a contact officer.
-Prepare a CHP.
-Obtain PII cover.
-Abide by the Rules of Conduct for Firms.
-Use the designation ‘Regulated by RICS’ on all practice material.

51
Q

What insurances are required for a RICS regulated firm?

A

-PII
-Employer’s Liability
-Public Liability
-Building insurance for offices.

52
Q

What is included in the Annual Returns required by RICS regulated firms?

A

-Type of business and staffing
-Nature of clients
-Training provision
-CHP details and records
-PI insurance details
-Whether they hold client money

Failure to carry out the return can lead to a fixed penalty.

53
Q

What are the RICS run-off cover requirements?

A

Must run for a minimum of 6yrs at £1m when closing down.

54
Q

What are the requirements for closing down a firm?

A

-Planned and managed diligently to avoid legal or professional negligence claims
-Agree a closure date and notify staff – directing them to support if required
-Inform clients (maybe offer recommendation)
-Deal with any outstanding Clients money in line with RICS guidance
-Arrange run off cover with insurers (6 years £1m)
-Keep electronic and hard files for 15 years (Limitation Act 1980)
-Ask clients to return any paperwork for archiving
-Notify RICS and do ‘deregistration form’
-Have a ‘out of office system’, mail redirection and emergency contact number

55
Q

What is a Pheonix Firm?

A

Phoenix Firm – closes and reopens another – RICS have right to refuse registration and impose training/management requirements.

56
Q

If a friend asks for professional services as a ‘favour’?:

A

State you do not have PI insurance and encourage them to seek advice through your company (acknowledging potential COI) or another RICS firm

57
Q

What is a bribe?

A

Under the Bribery Act 2010, a bribe is considered the offer, promise, giving or receiving of an ‘advantage’ in return for an action.

BASICALLY – Do not accept a gift that would influence your future judgement

58
Q

Who is the RICS CEO?

A

Justin Young

59
Q

What is Formal CPD?

A

Must have clear set learning objectives and outcomes.

60
Q

If you were unsure if CPD was Formal or Informal, how would you check?

A

I would consult the RICS CPD Decision Tree.

61
Q

Give an example on some CPD that you have done?

A

Webinar on BNG - how its impacting planning policy, development and opportunities and challenges for our clients. Massively emerging market and one to try and get on top of for business opportunities.

BNG was part of the Environment Act 2021 - 10% gain on all developments.

30 year management agreement

Can be on site, off site, or by purchasing credits.

Landowners can register land with Natural England.

62
Q

How could you avoid PII claims?

A

Good data management - filing systems and records

Clear Toe and ToB

Do not give advice if not SUK

Follow RICS guidance and Rules of Conduct

63
Q

Alternative Dispute Resolution methods?

A

Mediation - low cost and quick, but not enforceable

Arbitration - decision is binding, still low cost. (must be impartial and independent!!!)

Expert determination - parties agree individual to determine

Property Obmudsman - use of organisation, expensive, gov approved and binding.

64
Q

What is the RICS Definition of Sustainability?

A

Making informed decisions to mitigate negative environmental impact of the built environment

Example - considering energy efficiency in property refurbs (insulation, solar).

65
Q

If a purchaser submitted a bid after the deadline, what would you do?

A

Report it to the client, but advise them not to consider it as it would constitute unfair competition and does not align with the RICS Code of Conduct.

66
Q

What are the AML obligations of RICS regulated firms?

A

-Firms must have written policy addressing AML and terrorist financing
-KYC compliance with new clients – identify key persons and beneficial owner of a company – identify any PEP’s
-Comply with international sanctions
-Have whistleblowing procedures in place

67
Q

What would you do if you surpassed your fee proposal to a client?

A

-Case by case basis
-If scope of work remains unchanged, do not ask for amendment as this could reduce trust in the profession.
-If scope of works have changed, write to client with a suggested fee amendment and why
-DO NOT CHANGE QUALITY OF SERVICE WHATSOEVER.

68
Q

Difference between ToE and ToB

A

ToE are specific to the task.

ToB are general T&C’s such as payment terms.

69
Q

You overhear a business plan in a bar that gave you a professional advantage - what do you do?

A

This is an UNFAIR ADVANTAGE.

Do not use it to your advantage. If this is not possible, pass this on to someone else.

Information barrier.

70
Q

What are the current Hot Topics in the industry?

A

Sustainability
BNG
New Government
Promoting diversity and inclusion in the industry
COVID-19 Business Recovery

71
Q

What is a Conflict of Interest and how would you deal with one?

A

A scenario whereby there is an actual possible or perceived risk that a surveyor is able to act impartially.

If you believe there may be a conflict - notify all parties in writing at earliest convenience.

Parties must give Informed Consent if they want to proceed. Even then, members should only proceed if they are confident they can proceed impartially.

Continually monitor situation and act accordingly.

Example - potential conflict arose when I was asked to sell some area of tenanted woodland, and I knew the tenant. I wrote to the vendor and explained the connection. They provided their informed consent and I was happy I could continue impartially, therefore we proceeded.

72
Q

What are the 3 types of COI?

A

Own Interest Conflict

Party Conflict

Confidential Information Conflict

73
Q

What is a party conflict?

A

A situation in which the duty to act in the interests of a client or
other party in a professional assignment conflicts with a duty owed to another client
or party in relation to the same or a related professional assignment.

74
Q

What is an own interest conflict?

A

A situation in which the duty to act in the interests of a client in a professional assignment conflicts with the interests of that same RICS member/firm.

75
Q

What is a confidential information conflict?

A

A conflict between the duty of an RICS
member to provide material information to one client, and the duty of that RICS
member to another client to keep that same information confidential.

76
Q

What is included in the RICS Bye Laws?

A

Updated in 2020

They set out;
Definitions
Details re membership and registration
Conduct
Committees and groups

77
Q

What is Client Money?

A

Any money held by the firm that does not solely belong to it - such as a tenant’s deposit or clients money held to pay suppliers

78
Q

Can you name some examples of Money Laundering Red Flags?

A

Unexplained large cash transactions

Reluctance to provide information such as ID

Complex ownership structures

79
Q

How does ethics and conduct affect the environment we live and work in?

A

By acting in line with these rules, we help to create a an inclusive, positive society, and a progressive built environment.

RICS APC 2024 (Rural Pathway) (12 decks)

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