APC Spring 2026 > ETHICS L1 > Flashcards

ETHICS L1 Flashcards

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1
Q

When was the RICS incorporated?

A

1881 by the Royal Charter

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2
Q

When was the RICS founded?

A

1868

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3
Q

What is the Royal Charter?

A

A legally binding document issued by the UK Sovereign granting special status to an organisation

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4
Q

Why do you want to be a part of the RICS?

A

I want to be a part of a globally recognised regulatory body as well as working alongside over 134,000 proffessionals worldwide.
I want constantly provide high standard services

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5
Q

What are the benefits of being part of the RICS?

A

Status - cerditionals provide client confidence
Knowledge - professional guidance, pracitice knowledge and CPD
Recognition - promotion of professional global excellence
Advantage - RICS status and standards gives professional advantage
Network - over 134,000 professionals wordlwide

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6
Q

What are the 4 different types of membership?

A

FRICS
MRICS
AssocRICS
RICS Student

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7
Q

How do you become FRICS?

A

5 or more years as MRICS
Have another professional qualification
Be an expert (eg dispute resolver)
Industry recognition

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8
Q

Tell me about the governing council members.

A

RICS President: Nicholas Maclean (144th)
RICS President Elect: Maureen Erenbherg
RICS Vice President: Susanne Eickermann-Reipe
Up to 28 members in the council, all RICS members with exception of a few

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9
Q

What is the RICS governing council?

A

RICS highest governing body, setting out thei global strategy and ensuring RICS fulfils its Royal Charter obligations.

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10
Q

Who is the CEO of the RICS?

A

Justin Young (2023 - present)

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11
Q

How mnay specialist sectors are in the RICS?

A

18

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12
Q

What is the role of the RICS?

A
  1. Promotes and enforces the highest pofessional qualifications and standards in the development and management of land, real estate, construction and infrastructure.
  2. Accountable for members and the public
  3. Involved in policy influence and political engagement
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13
Q

What did Alison Levitt do?

A

Undertook an independent review of the RICS governance failings in 2021

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14
Q

Who was Lord Michael Bichard?

A

He undertook an independent review in 2022, comissioned by RICS governing council, to review the institutions purpose, governance and strategy

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15
Q

What did the Bichard review cover?

A

36 recommendations in 7 key areas:

1) Increased focus on diversity & inclusion across the profession and within RICS governance

2) Simplified clear accountable governance structure

3) Maintaining self-regulation through greater independence for regulatory functions

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16
Q

What was the aim of the Bichard Review?

A

To clarify the puporse of the RICS

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17
Q

What are the 5 RICS Rules of Conduct 2021?

A

Rule 1 - Memebrs and firms must be honest, act with integrity and comply with their professional obligations including obligations to RICS

Rule 2 - Members and firms must maintain their professional competence and ensure services are provided by competent individuals who have the necessary expertise

Rule 3 - Members and firms must provide a good quality and diligent service

Rule 4 - Members and firms must treat individuals with respect and encourage diversity and inclusion

Rule 5 - Members and firms must act within the public interest, take responsibilty for their actions and act to prevent harm and maintain public confidence in the profession

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18
Q

What is a conflict of interest (CoI)?

A

A situation where your duty to someone is potentially compromised by the fact that you have a material interest at stake in the matter

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19
Q

What are the different types of CoIs?

A

Party Conflict
Own-Interest Conflict
Confidential Information Conflict

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20
Q

What is a Party Conflict?

A

When you owe duties to two different clients at the same time and their interests clash, making it impossible for you to act fairly for both
E.g. acting for both a vendor and buyer on the same property

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21
Q

What is an Own Interest Conflict?

A

When your personal intersts get int he way of your ability to act in your client’s best interests
Eg advising a client on the purchase of a property I secretly have shares in

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22
Q

What is an Confidential Information Conflict?

A

When you have important information from one client that must be kept secret, but another client needs that same information in order for you to act properly for them
Eg I know valuation details from client a. Client b requests advice re the same property but the information is confidential

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23
Q

What is CPD?

A

Continuing Professional Development

Ongoing learning activities to remain competent and develop skills within a career

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24
Q

When is CPD to be submitted?

A

Annually
Completed by 31st December
Submitted by 31st January

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25
What are the CPD requirements for a Chartered Surveyor?
20 hours, at least 10 structured. New requirements include: - RICS global professional and ethical standards - AI, data and technology - Sustainability At least 1 structured hour every 3 years
26
What is PII?
Professional Indemnity Insurance All current and previous work must be covered by this To protect clients, surveyors and third parties against negligence claims when there is a duty of care breached and a claim for damages arises
27
What is your firms PII cover?
28
What is PII based on?
Turnover in preceding year : min. limit of indemnity required for each claim £100,000 or less : £250,000 PII £100,001 to £200,000 : £500,000 PII £200,001 and more : £1,000,000 PII
29
What is the maximum level of uninsured excess required by RICS?
Limit of indemnity : Max. uninsured excess Up to £10m : greater of 2.5% of the sum uninsured or £10,000 Over £10m : no set limit
30
How many years can you claim for negligence?
6 years
31
What is a locum agreement?
A formal written contract appointing a qualified professional to manage a firm's business in the event of absence.
32
What is the minimum level of PI cover?
33
What does a firm need to be RICS registered?
Regulation provides a gold standard of quality control for clients Firms must annually make a return to the RICS comfirming this compliance and obligations Practices can be corporate bodies, partnerships, LLPs or sole practitioners
34
PI scenario question: if you were doing a £25m valuation of a care home, how much PI would you be required to have?
Assess risk and turnover and confirm that it would be in line with the RICS freshold. I confirm it would be in the minimum standards of £250k turnover Discuss risk and t/o with brokers
35
What happens if you cannot resolve a complaint? What is the PS surrounding this?
RICS PS: CHP
36
What is required of an RICS regulated firm?
Publish a CHP - providing RICS approved ADR and maintain complaints log Ensure all current and previous work is covered by PII Display on their business literature a designation to denote that they're a RICS regulated firm
37
What is required when closing down your RICS registered business?
- Inform the RICS - Inform clients asap and hand over arrangements to a new firm - Return client monies to their own accounts - Retain client files and records for a minimum of 6 years - Inform insurers and procure PII run-off cover for a minimum of 6 years from expiry of the policy in force at the time of cessation
38
What is your firm's CHP?
7 says to acknowledge 21 days to respond
39
When does a firm need to be RICS registered?
If the firm provides surveying and 50% of its members are RICS members 25% are RICS members, can apply for registration
40
Tell me something that was covered in the RICS Professionalism Module
Types of conlficts of interest
41
Give me an example of when you have demonstrated each rule of conduct.
xxxx
42
How do you carry out a CoI check?
Internal software at my firm. I input clients name, property adress and information which runs acheck through previous jobs. I also ask my wider team I ensure I have no personal conflicts
43
If a CoI is identified, how would you approach this?
Immediately diclose it and evaluate its severity. Ask all affected parties if they are happy for you to proceed?
44
What is the difference between conflict avoidance and conflict management?
45
Provide an example of how you would manage a conflict.
46
What conflict is not manageable?
Acting on both sides of a transaction
47
What is a NDA?
A confidentiality agreement that establishes a confidential relationship between parties to protect sensitive information from being diclosed to third parties
48
Who issues an NDA?
Legal team within a firm
49
Is an NDA legally binding?
Yes
50
How long does the NDA last for?
classic is 2-3 years, should say in the NDA
51
What is an RCA?
Reinstatement Cost Assessment Determines the accurate cost to rebuild a property from scratch, inckduing demolition, site clearance and professional fees.
52
What would you do if your client insisted that you undertook the RCA?
I would inform them that under the obligations of the RICS that I cannot undertake work outside my area of expertise
53
What is the difference between a valuation ToE and an agency ToE?
Valuation ToE: create a legally binding framework for an expert opinion on value Agency ToE: define contarctural relationship for makreting, selling or letting a property focused on commission and marketing strategy
54
Give an example of some CPD you have done recently.
55
Confidential sale in Pontardawe: provide an example of the anonymised marketing material.
56
Confidential sale in Pontardawe: how did parties know which property they were looking at?
57
Confidential sale at Pontardawe: How did you balance the interest?
58
What are the RICS's THREE main roles?
1 - maintain highest standards of education and training 2 - protect consumers through strict regulation of professioanl standards 3 - B the leading source of ifnormation and independent advice on land, property, construction andassociated environmental issues
59
What RICS standard is set out for PII?
RICS Professional Indemnity Insurance Requirements, July 2024
60
Why are RCAs required?
They ensure properties aren't over or under insured I.e. if a property is under-insured could lead to reduced claim payouts
61
Tell me about the use of the RICS logo (for regulated firms)
In April 2020, new rules came into effect, including a restriction to the use of the designation 'Chartered Surveyors' by firms to the trading name only. Only RICS members and registered firms can use the logo. The colour and style of it MUST NOT be changed
62
How many countries is the RICS present in?
More than 140 countries
63
Do you know any case law regarding run-off cover?
Merrett v Babb (2001)
64
Tell me about Merrett v Babb
Highlights the importance of having run-off cover in place A surveyor was sued for negligence by a former client The surveying firm was no longer in extistence therefore the individual surveyor was pursued for damages successfully Can come after the individual who signed the report if the business ceased trading.
65
You have a client who is also your personal friend. They invite you on holiday, what is your best response?
Due to the ongoing business relationship it may not be appropriate therefore I would politely decline. If they insist, I would get clearance from management and share the expense with the holiday.
66
How do you choose your PI cover?
Choose only from a list of RICS approved PI providers
67
You are acting as an agent in the sale of a property and your son would like to buy the house. What is the best thing to do?
Inform management of the COI. Only take informed consent, act with integrity and ensure no bias.
68
What are Terms of Engagement?
Written contract between a firm and the client in order to avoid doubt and confusion.
69
What is the purpose of PII?
If firm or surveyor faces a claim, they are covered for financial loss Ensure the firm's clients do not suffer financial loss, which the firm cannot meet
70
If your friend who is MRICS is failing to meet standards, what should you do?
Verify the facts, talk to the friend, if not inform RICS
71
What are some of the challenges facing the RICS?
The impact of AI Sustainability skills shortages and fewer surveyors
72
What is 'run-off pool'?
Assigned Risks Pool is now the run-off pool Last resort insurance facility for UK-reglated RICS firms who are unable to secure mandatory PII in the open market. It is temporary high cost cover for up to 2 years to allow firms to coninue trading or wind down. Protects against retrospective claims
73
What is negligence?
breached, suffered loss of damages
74
Please explain your understanding of the professional obligations of chartered surveyors.
Obliged to undertake CPD annnually and to act in line with professional standards
75
What are the professional obligations of firms?
- to publich an RICS-approved CHP - Ensure PII is in place -
76
What RICS guidance/PS in place for anti-money laundering?
Countering Financial crome: Bribery, corruption, Money Laundering, Terrorist Financing and Sanctions Violations (2nd edition, 2025)
77
What are the key principals of this professional standard?
1) Covers estate agents work and 'relevant financial business work' inside AND outside the UK by a firm 2) Firms must have ML and TF risk assessment 3)Staff training must be provided 4) AML checks mst be undertaken on proposed purchasers for properties (identity) and check source of funds BEFORE contracts exchange 5) ENSURE appropriate record-keeping
78
What is a bribe?
Can be giving, offering, promising or receiving an advantage such as a payment, gift or service for an action which is illegal or breaches trust
79
What can you tell me about the Bribery Act 2010?
1. Reduced Bribery in businesses in the UK and abroad 2. Covers both private and public sectors 3. Based on 6 principals
80
What 6 principals are covered by the Briber Act 2010?
1. Due Diligence 2. Risk Assessment 3. Proportionality 4. Communication 5. Monitoring/Reviewing 6. Top Level Commitment
81
What are the 4 offences under the Bribery Act?
1. Bribing 2. Receiving a bribe 3. Bribing a foreign oubkic official 4. Failing to prevent bribery
82
Who is the Bribery Act policed by?
Serious Fraud Officer
83
What red flags are you aware of when it come sto money laundering?
1. changes to parties (names|) in transactions 2. Unwillingness or inabilities to provide identity documents 3. Money in unusual currencies 4. Cash
84
What are the RICS Future Foundations (following th Bichard Review)?
Vision Mission Strategic Goals Values World Class Organisation
85
What help can RICS members receive should someone face an ethical issue?
1. RICS Ethics Decision Tree 2. RICS Regulation Confidentiality Hotline
86
What are the RICS 5 ethical standards?
1. Honesty 2. Competence 3. Service 4. Respect and Diveristy 5. Responsibility Updated as Rules of Conduct 2021
87
Who deals with CHP
Complaints Handling Officer
APC Spring 2026
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