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Friday Five – 3 January – 5 Questions in 5 Minutes

Friday Five – 3 January – 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 2019/20, examinable until 31 August 2020.

  1. Which of the following IFA firms would NOT require its annual accounts to be audited?
    1. An unincorporated firm that doesn’t have permission to hold client assets
    2. A sole trader who has formal permission to hold client assets
    3. A limited liability company who undertakes activity within the scope of the Insurance Distribution Directive
    4. A partnership who operates a client bank account specifically to hold client monies with formal permission to do so
  1. Dan runs a hedge fund and relies on arbitrage to produce his returns. This suggests that he is using which of the following strategies?
    1. Event driven
    2. Relative value
    3. Tactical trading
    4. Long/short
  1. Shaun has recently sold his buy-to-let house for £150,000 having paid £93,000 for it 15 years ago. He has incurred the following expenses; estate agent fees of £1,500; legal fees of £800 and £45 for a plumber to repair the shower prior to sale. What is his gain for capital gains tax
    1. £56,200
    2. £55,500
    3. £54,700
    4. £54,655
  1. Mary dies at age 56 before crystallisation of her only pension fund. At the date of death, her SSAS value was £750,000 and she also had £1.03m of pension term assurance. If her dependants took all benefits in the form of a lump sum benefit, the lifetime allowance charge (if any) would be:
    1. £0
    2. £125,000
    3. £181,250
    4. £398,750
  1. In which of the following situations can policy splitting on divorce be beneficial?
    1. Where one of the divorcees is significantly older than the other
    2. When the health of one has deteriorated since the policy was taken out
    3. Where the income of one of the divorcees is significantly lower than the others
    4. When the terms of a new policy would be more beneficial than the existing policy

 

Answers

  1. A – See R01 Study Text, Chp 4
    Grab our taster mock exam paper for CII R01. Click here to download.
  1. B – See R02 Study Text, Chp 6:2
    Grab our taster mock exam paper for CII R02. Click here to download.
  1. C – See R03 Study Text, Chp 3
    Grab our taster mock exam paper for CII R03. Click here to download.
  1. D – See R04 Study Text, 2:2
    Grab our taster mock exam paper for CII R04. Click here to download.
  1. B – See R05 Study Text, Chp 2
    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.

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