Friday Five – 18 August – 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 2016/17, examinable by the CII until 31 August 2017.  They do not relate to tax year 2017/18 which is only examinable by the CII from 1 September 2017.

1. Which of the Competition and Markets Authority (CMA) strategic goals aims to ‘deter wrongdoing, protect consumers and educate businesses’?
   1. Delivering effective enforcement
   2. Extending competition frontiers
   3. Achieving professional excellence
   4. Developing integrated performance

2. On which of the following disposals would the sale proceeds be used as the disposal figure in calculating Capital Gains Tax (CGT)?
   1. On a commercial sale
   2. If an asset is given away
   3. On a disposal to a connected person
   4. On a disposal, not at arm’s length

3. James, age 29, has been nominated by his uncle as the beneficiary of his occupational money purchase scheme following his death. Which of the following death benefit options will NOT be available to him?
   1. Scheme pension
   2. Lifetime annuity
   3. Flexi-access drawdown
   4. Lump sum

4. Daniel’s company provides income protection for him and they pay the premiums. For how long will the benefits be paid if he becomes ill?
   1. For a maximum period of 2 years
   2. To the earliest of his recovery or normal retirement date
   3. For a period chosen by the company
   4. For a period of between 2 and 5 years depending on the nature of Daniel’s incapacity

5. One approach gaining popularity as a risk profiling tool is stochastic modelling which determines asset allocation using an economic model. Which of the following correctly describes the purpose of stochastic modelling?
   1. To use probabilistic methods to estimate future returns
   2. To establish the returns a client feels are required
   3. To establish the level of risk a client can tolerate
   4. To understand the client’s capacity for risk

Answers

1. A – See R01 Study Text, Chp 4
   Grab our taster mock exam paper for CII R01. Click here to download.

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

3. A – See R04 Study Text, Chp 2.2
   Grab our taster mock exam paper for CII R04. Click here to download.

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

5. A – See J10 Study Text, Chp 1
   Grab our taster mock exam paper for CII J10. 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?

Do let us know by leaving a comment below – we promise to read them all. (Humour particularly appreciated on a Friday!)