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Ethics, Conflict Avoidance. > RICS, Ethics, Rules of Conduct & Professionalism > Flashcards

RICS, Ethics, Rules of Conduct & Professionalism Flashcards

1
Q

Who’s is the current RICS President?

A

Tina Paillet from 01 Jan 2024

142nd RICS President

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2
Q

RICS Conflict of Interest guidance?

A

Professional Standard: RICS Conflicts of Interest 1st Edn.
Effective 01 January 2018

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3
Q

3 types of conflict?

A
  1. Professional conflict
  2. Personal conflict
  3. Confidential Information conflict
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4
Q

When was RICS founded?

A

1868

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5
Q

When was RICS Royal Charter Granted?

A

1881

A ‘Grant’ issued by the Monarch (Queen Victoria), and empowered through parliament(privy council) bestowed upon the institution.
“….. to maintain and promote the usefulness of the profession for the public advantage in the United Kingdom and in any other part of the world”

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6
Q

what are Byelaws and Regulations

A

Byelaws – enabling principles
Regulations – detail on things like fees and designations

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7
Q

What does RICS stand for?

A

Royal Institution of Chartered Surveyors

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8
Q

How many RICS members are there globally?

A

over 135,000

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9
Q

The types of RICS membership

A
  1. Associate members (AssocRICS)
  2. Professional members (MRICS)
  3. Fellow members (FRICS)
  4. Honarary Members (HonRICS)
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10
Q

RICS Valuation - Global Standards Structure

A
  • Professional Standards (PS) - Mandatory
  • Valuation Technical & Performance Standards (VPS) - Mandatory
  • Valuation Practice Guidance - Applications (VPGA) - Advisory
    AKA Valuation Applications
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11
Q

Name the different parts of the RED Book
RICS Valuation - Global Standards

A

Part 1: Introduction
Part 2: Glossary
Part 3: Professional Standards (PS)
Part 4: Valuation technical and performance standards (VPS)
Part 5: Valuation Applications (VPGA)
Part 6: International Valuation Standards

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12
Q

Name the RED Book professional standards?

A

PS 1: Compliance with standards where a written report is provided.
PS 2: Ethics, competency, objectivity, and disclosures (CODE)

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13
Q

Name the RED Book valuation technical and performance standards?

A

VPS 1: Terms of engagement (scope of work)
VPS 2: Inspections, investigations and records
VPS 3: Valuation reports
VPS 4: Basis of value, assumptions and special assumptions
VPS 5: Valuation approaches and methods

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14
Q

Name the RED Book valuation applications?

A

Valuation for…
VPGA 1: …inclusion in financial statements
VPGA 2: …interests for secured lending
VPGA 3: …busnesses and business interests
VPGA 4: …individual trade related properties
VPGA 5: …plant and equipment
VPGA 6: …intangible interests
VPGA 7: …personal property, including arts and antiques
VPGA 8: …real property interests
VPGA 9: Identification of portfolios, collections and groups of properties
VPGA 10: Matters that may give rise to material valuation uncertainty

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15
Q

Leading document for Rules of Conduct?

A

RICS Rules of Conduct - Global edition.
Effective from 02 February 2022

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16
Q

Which ethical principles are the RICS Rules of Conduct based on?

A
  • Honesty
  • Integrity
  • Competence
  • Service
  • Respect and responsibility
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17
Q

Why is behaving ethically important?

A

It is at the heart of what it is to be a professional and distinguishes professionals from others in the marketplace.

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18
Q

Allison Levitt report.

A

Criticism of RICS governance as a result of poor financial controls. Reputational damage. Apologies for wrongful dismissal of 4 non-executives who raised concerns. Review of internal governance, advice to increase board members.

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19
Q

Reason for Lord Bichard review.

A

Comissioned by governing council in December 2021 following recommendation in Levitt Review that a ‘wide-ranging examination of purpose, governance and strategy’ should be conducted by an external viewer.

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20
Q

Rule of Conduct #1

A

Members and firms must…
be honest, act with integrity, comply with professional obligations, including to RICS.

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21
Q

Rule of Conduct #2

A

Members and firms must…
maintain professional competence, ensure services provided by competent individuals who have necessary expertise.

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22
Q

Rule of Conduct #3

A

Members and firms must…
provide good-quality and diligent service.

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23
Q

Rule of Conduct #4

A

Members and firms must…
treat others with respect and encourage diversity and inclusion.

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24
Q

Rule of Conduct #5

A

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

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25
Q

Professional obligations for RICS Members?

A

Must…
1. comply with CPD requirements set by RICS;
2. co-operate with RICS; and
3. promptly provide all information reasonably requested by Standards Regulation Board, or authorities acting on their behalf.

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26
Q

Professional obligations for RICS-regulated firms?

A

Must…
1. Publish complaints handling procedure;
2. All work covered by adequate personal indemnity insurance approved by RICS;
3. Sole principle must have appropriate arrangements for professional work in event of inability to work;
4. Co-operate with RICS;
5. Promptly provide all information reasonably requested by Standards and Regulation Board, or authorities acting on their behalf;
6. Display RICS designation on all business literature in line with RICS published policy; and
7. Report to RICs any matter required to report under Rules for the Registration of Firms.

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27
Q

Six principles of the bribery Act (2010)?

A
  1. Proportionality;
  2. Top level committment;
  3. Risk assessment;
  4. Due dlilgence;
  5. Communication;
  6. Monitoring and review.
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28
Q

Make up of RICS SRB?

A

SRB Chair
5 RICS members
5 independents

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29
Q

What is the function of RICS Standards and Regulation Board?

A
  • Uphold sector leading standards;
  • Develop a consistent, global strategy; and
  • Overseeing implementation across all work regions.
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30
Q

RICS Standards & Regulation Board Chair?

A

Nigel Clarke

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31
Q

Purpose of RICS Board?

A

Direct RICS affairs under delegated authority from Governing Council.

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32
Q

Make up of RICS Board

A
  • Non-members (independents)
  • Members of RICS, and
  • RICS Executives.
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33
Q

Current RICS Board Chair?

A

Chair: Martin Samworth

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34
Q

Current RICS Board CEO

A

Justin Young

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35
Q

Make up of RICS Governing Council

A

*RICS President - Tina Paillet FRICS
*RICS President Elect - Justin Sullivan FRICS
*RICS Senior Vice President - Nicholas Maclean FRICS
*6 professional group seats
*13 geographic seats
*Next-gen seat
*Senior independent governor
*Independent member
*Co-opted seats x3

All members are RICS professionals with exception of Senior Independent Governor & Independent Member

36
Q

What is the RICS Governance Structure?

A
  • Governing Council;
  • RICS Board; and
  • Standards and Regulation Board
37
Q

Roles of Governing council and Regulatory board?

A

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.

38
Q

What are the 5 rules of conduct?

A
  1. Honesty and integrity
  2. Professional competence
  3. Good quality and diligient service
  4. Respect, diversity and inclusion
  5. Act in the public interest
39
Q

What are the RICS CPD requirements?

A

All members (AssocRiCS, MRICS, FRICS) must complete a minimum 20 hours of CPD each year (Jan to Dec).

At least 10 hours should be formal.

Must be recorded online by 31st January.

Global Professional and Ethical Standards every 3 years.

40
Q

What is the purpose of the Red Book?

A

To provide an effective framework within the rules of conduct so that users of valuation services have confidence that the valuation of a RICS member is consistent with IVSC internationally recognised standards.
Concerns quality assurance compliance

41
Q

What does the Red Book not do?

A
  • Instruct members how to value in individual cases
  • Prescribe a particular format for reports but they must meet the mandatory requirements.
42
Q

What are the RICS Global Valuation Technical & Performance Stanards

A

TOE>INSP>Reports>Bases>Methods
VPS 1 - Minimum terms of engagement
VPS 2 - Inspections and investigations
VPS 3 - Valuation reports
VPS 4 - Basis of value, assumptions and special assumptions
VPS 5 - Valuation approaches and methods

43
Q

What is the Civil Service Code?

A

Core values to support good government and ensure the achievement of the highest possible standards in the Civil Service.

44
Q

What are the core values of the Civil Service Code?

A

IHOI
* Integrity
* Honesty
* Objectivity
* Impartiality

45
Q

What does integrity mean in the civil service code?

A

Putting obligations of public service above your personal interests.

46
Q

What does Honesty mean in the Civil Service Code?

A

Being truthful and open.

47
Q

What is a bribe?

A

Giving, offering, promising, or receiving a gift, payment or service for an action which is illegal or a breach of trust.

48
Q

What are the 6 (prevention) principles of The Bribery Act 2010

A

PeTeR DeCiMal
1. Proportionality
2. Top level committment
3. Risk assessment
4. Due diligence
5. Communication
6. Monitor and review

49
Q

Bribery Act - Proportionality

A

Actions you take are proportionate to the risks you face & size of business.

50
Q

Bribery Act - Top level committment

A

Those at the top of the organisation are in the best position to ensure organisation conducts business without bribery.

51
Q

Bribery Act - Risk assessment

A

Think about the bribery risks you might face.

52
Q

Bribery Act - Due diligence

A

Know exactly who you are dealing with can help protect your organisation against those who are less trustworthy.

53
Q

Bribery Act - Communication

A

Communication policies and procedures to staff and others

54
Q

Bribery Act - Monitoring and review

A

The risks you face and effectiveness of procedures may change over time.

55
Q

The 4 bribery offences

A
  1. Bribing
  2. Receiving a bribe
  3. Bribing a foreign official
  4. Failing to prevent bribery
56
Q

Bribery penalties

A

Maximum 10 years imprisonment and/or unilimited fine

57
Q

What is money laundering?

A

Where proceeds of crime are disguised or converted and then realised as legitimate assets.

58
Q

The 3 parts of PS Countering bribery, corruption, money laundering and terroist financing 2019

A
  1. Requirements
  2. Guidance
  3. Supplementary guidance
59
Q

Principle legislation for money laundering

A

The Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017

60
Q

What does the Money Laundering Regs 2017 do?

A

(1)Prevent the laundering of illegally gained money into legitimate enterprises and (2) prevent the funding of terrorism.

61
Q

What do you need to do under the Money Laundering Regs 2017

A
  • Conduct a risk assessment
  • Create and implement systems, controls, policies and procedures
  • Provide staff training
  • Comply with separate requirements when doing business with Politicians
  • Ensure record keeping and data protection systems meet requirements
  • Comply with separate requirements if you are a Trustee of a Trust.
62
Q

Money Laundering red flag indicators - client

A
  • secretive or evasive about who they are
  • uses an intermediary
  • avoids personal contact without good reason
  • refuses to provide information about the transaction
  • has criminal associations
  • has unusually high level knowledge about money laundering
  • is a Potentially Exposed Person (PEP) or subject to sanctions
63
Q

Money Laundering red flag indicators - parties

A
  • representatives reside in or are incorporated in high risk country’s
  • transactions are connected without an apparent reason
  • has connections of family or other business in nature which causes doubts
  • appear multiple transactions in a short space of time
  • executing the transaction is unusual.
64
Q

Why register firms for RICS regulation

A

CPS
Confidence - for clients that firm is subject to RICS regulation/supervision
Professionalism - firm required to give clear impartial advice
Security - recognised complaints procedure, free independent redress, approved PII
provides gold standard of quality control for clients

65
Q

What RICS statement is useful for registration of firms?

A

Regulation statement:
Rule for the regulation of firms
(v8 - 02 Feb 2022)

66
Q

A firm is eligable to register for regulation by RICS if…

A
  • Firm provides surveying services to the public; and
  • At least 25% of Firms Principles are RICS members.
67
Q

Firm is required to register for regulation by RICS if…

A
  • Firm provides surveying services to the public;
  • Firm is operating in the UK
  • At least 50% of the Firm’s Principles are RICS Members.
68
Q

What steps must be taken if you are closing a firm?

A

(5 steps)

  • Inform RICS of closure
  • Inform clients and ensure hand over arrangements to new firm are made
  • Return client money
  • Inform insurers and arrange run off cover for a minimum of 6 years
  • Retain copy of client files and records for minimum of 6 years
69
Q

RICS definition: bribery

A

The offer, promise, giving or demanding or acceptance of an advantage as an inducement for an action that is illegal, unethical or a breach of trust.

70
Q

RICS definition: corruption

A

The misuse of public office power for private gain, or misuse of private power in relation to business practice and performance.

71
Q

RICS definition: money laundering

A

Concealing the source of proceeds of criminal activity to disguise their illegal origin.

72
Q

How is money laundering concealed?

A

Through hiding, transferring and/or recyling illicit money or other currency through one or more transactions, or converting criminal proceeds into seemingly ligitimate property.

73
Q

RICS definition: terrorist financing

A

The solicitation, collection or provision of funds with the intention that they may be used to support terroists acts or organisations. Both directly or indirectly.

74
Q

What RICS compliance is requried when staring a new practice/firm?

A
  • Inform RICS - for regulation by Regulatory Board
  • Appoint Responsible Principle (Contact Officer) for all RICS communcations
  • Arrange suitable PII and send cover details to RICS
  • Set up clients’s money handling procedure
  • Register for RICS Registered Valuation scheme - for RED BOOK reports.
  • Set up and obtain RICs approval for Complaints Handling Procedure
  • Set up complaints log
  • Appoint Complaints Handling Officer
  • Obtain logo kit from RICS, comply with designation ‘Regulation by RICS’
  • Plan for succession if sole practitioner
  • Set up staff training plan
  • Ensure completion of RICS Annual Return
75
Q

What statutory compliance is required when starting new practice/firm?

A
  • Business Names Act 1985 & Companies Act 1985
  • Equality Act 2010
  • Financial Services Acts (2000, 2012)
  • Bribery Act 2010
  • Money Laundering Regulations 2017 - appoint Money Laundering Reporting Officer
  • Health & Safety Act 1974 (as amended) + fire + Asbestos Regs
  • Employment Law - living wage, working hours, pensions.
  • GDPR 2018
  • Estate Agents Act 1979
  • Misrepresentations Act 1967
  • Consumer Protection Regulations 2008
  • Inform HMRC for VAT registriation (taxable turnover threshold currently >£85,000 pa)
  • Ensure compliance with employer and public liabilty insurance
76
Q

What are the 5 RICS Professional Statements

A
  1. Rules of Conduct (Global) - 02 Feb 2022
  2. (UK) Client Money Handling - 1st Edition, October 2019
  3. Conflicts of Interest - 1st Edition, January 2018
  4. Risk, Liability and Insurance (UK) - 1st Edition, April 2021
  5. (Global) Countering Bribery and corruption, money laundering and terrorist financing - 1st Edition, February 2019
77
Q

How is RICS governed?

A

Through its constitutional documents:
* Royal Charter
* Bye-laws
* Regulations
* Standing Orders

78
Q

RICS Governance Bodies

A

Governing Body = Governing Council
* Delegates responsibilities to RICS Board
Oversees effectiveness of RICS Board and Standards & Regulation Board*

79
Q

Purpose of RICS Board

A
  • Delivery of business plan
  • Oversight of operations (exc. Standards & Regulation Board)
80
Q

Purpose of Standards & Regulation Board

A
  • Exclusive responsibility for exercising RICS regulatory functions. Includes
    *stratergy
    governance
    structure
    policy
    operational oversight
81
Q

Benefits of being a RICS member?

A

Status - develop expertise & earning potential
Recognition - demonstrate higher professional and ethical standards
Knowledge - enhance skills and employability
Network - connect with peers globally, explore trends and seek new opportunities
Market advantage - having say in market surveys and leading consultations

82
Q

What does the Royal Charter mean in practice?

A

Important changes to RICS constitution - its bye-laws - have to be ratified by the UK government, through the privy council even after they have been approved by RICS members.

83
Q

What does Objectivity mean in the Civil Service Code?

A

Basing advice and decisions on rigorous analysis of the evidence.

84
Q

What is Bribery?

A

Giving someone a financial or other advantage to encourage that person to perform their functions or activities improperly or to reward that person for already having done so.

85
Q

What does Impartiality mean in the Civil Service Code?

A

Acting solely on the merits of the case and serving equally well governments of different political persuasions.

Ethics, Conflict Avoidance. (5 decks)

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