Friday Five – 10 April – 5 Questions in 5 Minutes

Welcome to this week’s Friday Five – 5 Questions in 5 Minutes Every Friday

What’s this all about?

It’s a bit of Friday Fun where we provide you with 5 questions relevant to a mix of CII exams. The challenge is for you to answer them in 5 minutes. Answers at the bottom of the page.

Questions

IMPORTANT!  These questions relate to examinable tax year 2019/20, examinable by the CII until 31 August 2020.  They do not relate to tax year 2020/21 which is only examinable by the CII from 1 September 2020.

1. The rule that all communications concerning the financial promotion of regulated business must be fair, clear and not misleading does NOT apply to:
   1. a personal quotation or illustration.
   2. a poster highlighting a fund’s past performance.
   3. an advertisement detailing charges under a product.
   4. web-based advertising covering claim statistics for IP.

2. What should be considered in determining the success or failure of a portfolio through performance evaluation? Tick all that apply.
   1. If the client’s return expectations have been exceeded
   2. The composition of the portfolio compared with a suitable benchmark portfolio
   3. Changes in the fund manager’s ratings e.g. S&P ratings
   4. The effects of asset allocation
   5. Stock selection and/or sector choice

3. Henry is planning to move to Switzerland. Which of the following tax planning strategies relating to his investments should he consider? Tick all that apply.
   1. Move bank accounts offshore to avoid any potential liability to UK income tax.
   2. Dispose of any gilt-edged securities as the income is taxable.
   3. Withdraw any ISA investments as they will lose their tax-free status.
   4. Dispose of any assets that will produce a loss and postpone the disposal of any assets that will produce a gain.

4. The Pension Protection Fund (PPF) was introduced to provide default protection for whom?
   1. Employees who are members of defined benefit schemes.
   2. Pensioners retiring on an inadequate level of benefits.
   3. Anyone who had elected to opt out of earnings-related State benefits.
   4. Anyone who has been mis-sold a pension product.

5. Irene has taken out an income protection policy. If she becomes incapacitated and unable to work, when will her benefits be paid?
   1. After a deferred period chosen by her
   2. From day one of her claim
   3. After a deferred period stated by the insurer
   4. If she is incapacitated for a continuous period of 3 months or more

Answers

1. A – See R01 Study Text, Chp 7
   Grab our taster mock exam paper for CII R01. Click here to download.

2. BDE – See R02 Study Text, Chp 9
   Grab our taster mock exam paper for CII R02. Click here to download.

3. AD – See R03 Study Text, Chp 12
   Grab our taster mock exam paper for CII R03. Click here to download.

4. A – See R04 Study Text, Chp 1
   Grab our taster mock exam paper for CII R04 Click here to download.

5. A – See R05 Study Text, Chp 6
   Grab our taster mock exam paper for CII R05. Click here to download.

How did you find this week’s questions? Did you complete them in 5 minutes? Did you get them all correct? Do you disagree with any?

If you found this quiz useful for your CII exam revision, please do share it with your colleagues.