Setting Up In Practice

Question 1

What are the 7 professional obligations of firms?

Answer 1

1. Firms must publish a complaints-handling procedure, which includes an alternative dispute resolution provider approved by RICS, and maintain a complaints log.
2. Firms must ensure that all previous and current professional work is covered by adequate and appropriate professional indemnity cover that meets the standards.
3. Firms with a sole principal must make appropriate arrangements for their pr4ofessional work to continue in the event of their incapacity, death, absence from or inability to work.
4. Firms must coperate with RICS.
5. Firms must promptly provide all infomation reasonably requested by the Standards and Regulation Board, or those exercising deligated authority on its behalf.
6. Firms must display on their buisness literature, in accordance with RICS’ published policy on designations, a designation 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 of Registration of Firms.

Question 2

Procedures for setting up in practice:

Answer 2

Contact the RICS for guidance and obtain a company start up pack.

Inform the RICS and register for regulation.

Appoint a contact officer for all RICS communication.

Prepare a complaints handling procedure.

Obtain professional indemnity insurance cover.

Abide by the Rules of Conduct for Firms.

Use the designation ‘Regulated by RICS’ on all practice material.

Question 3

What information do registered firms need to send to RICS annually?

Answer 3

It is called Annual return and carried out on-line and failure to do so leads to a fixed penalty.

It includes:
- Type of business and staffing.
- Nature of clients.
- Training provision.
- PI insurance details.
- Weather the firm holds clients’ money.
- Complaints handling procedures details and records.

Question 4

Complaints handling procedure:

Answer 4

The RICS provides a model form.
The process must include a redress mechanism.
Details of the policy should be issued to the client with the Terms of Business.
It must be clear, quick, transparent, and impartial and free of charge within the first stage.
Names and contact details of the nominated 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 inform 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 a senior member of the firm or the complaints handling officer.

Stage 2 - If the issue is not resolved, the complaint is referred to an independent third party with the authority to award redress. The complaint may be expected to contribute towards costs at this stage.

Question 5

Handling clients money:

Answer 5

Preserve the security of clients’ money which does not belong wholly to the company.
RICS regulated firms that operate a client account must:

• Set clear segregation of duties for employees
• A principle oversees the client money accounting functions.
• Principles cannot override controls.
• Competent and knowledgeable staff are to process clients’ money with cover provided for long term absence.
• Accounting systems and data must be secure.
• Client money money must be kept separate and clearly identifiable with the word ‘client’ included in the bank account name.
• Clients must always have access to funds.
• We must agree the terms and advise the client on bank details.
• The account must not be overdrawn.
• We must maintain client ledgers and provide a running balance.