Friday Five – 2 February – 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

These questions relate to examinable tax year 2017/18, examinable until 31 August 2018.

1. Which of the following key stakeholder groups might not be essential in embedding an ethical culture at sector and firm level?
   1. Clients
   2. Employees
   3. Regulators
   4. Media

2. Jamie is considering selling his business but is concerned about the potential Capital Gains Tax bill he will get if he does. You explain to him that he can claim entrepreneurs’ relief as long as:
   1. he has owned the business for at least one year prior to selling
   2. as shareholder, he holds at least 10% of the voting rights
   3. he has made taxable profits in excess of £500,000 for 3 consecutive tax years
   4. he hasn’t exceeded the lifetime limit of £5m of gains that qualify

3. Alan’s 61st birthday is tomorrow. He has 25 years’ service in a 1/60ths final salary scheme. His pensionable remuneration is £40,000. The scheme’s normal retirement age is 65. If Alan retires tomorrow and the scheme reduces his pension by 0.5% per month for early retirement, how much will his annual scheme pension be?
   1. £12,666.67
   2. £14,000.00
   3. £16,333.34
   4. £16,666.67

4. 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

5. In order for the CAPM to be useful, the beta of a security must be stable or predictable. The beta of a security is usually calculated from:
   1. Treasury bills
   2. future returns
   3. past experience
   4. profitability

Answers

1. D – See R01 Study Text, Chp 10
   Grab our taster mock exam paper for CII R01. Click here to download.

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

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

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

5. C – See J10 Study Text, Chp 8
   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!)