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Friday Five – 4 September – 5 Questions in 5 Minutes

Friday Five – 4 September – 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 2020/21, examinable by the CII until 31 August 2021.

  1. Which of the following is an example of a global regulatory body?
    1. The European Systemic Risk Board
    2. The Prudential Regulation Authority
    3. The Financial Action Task Force
    4. The Bank of England
  1. Fund A has a return of 12%, a benchmark return of 10%, and a tracking error of 6%. Fund B has a return of 11%, a benchmark return of 10%, and a tracking error of 5%. From this information, you can say that the: Tick all that apply.
    1. higher the positive information ratio, the higher the value added by the fund manager through active management.
    2. information ratio for fund A is 0.33.
    3. information ratio is used to assess risk-adjusted performance.
    4. fund manager of fund B has added the most value.
  1. Phil doesn’t receive a tax return but made a significant gain when he sold his portfolio of shares on 7th April 2020. By what date must he tell HMRC, and when must he pay any capital gains tax?
    1. By 5th April 2021 and paid within 6 months of the gain being made
    2. Within 6 months of the gain being made and paid by 5th April 2021
    3. Within 28 days of the gain being made and paid by 5th April 2021
    4. Within 6 months of the end of tax year 2020/21 and paid by 31st January 2022
  1. In June 2006, Alan crystallised a Retirement Annuity fund of £750,000 when the lifetime allowance was £1.5m. A further crystallisation event takes place in 2020/21 when he takes a defined benefit scheme pension of £48,000 p.a. and a pension commencement lump sum (PCLS) of £129,050. If any excess over the lifetime allowance is taken as a lump sum, the tax charge will be:
    1. £13,750.
    2. £92,400.
    3. £303,875.
    4. £310,750.
  1. Systemis Ltd pays the premiums for a group personal accident and sickness insurance for their employees. How is this treated in relation to the company’s taxation?
    1. There is no tax advantage for the company.
    2. They receive tax relief at 20% on the premiums paid.
    3. The cost is deducted from their tax liability.
    4. It is treated as an allowable business expense.

 

Answers

  1. C – See R01 Study Text, Chp 1
    Grab our taster mock exam paper for CII R01. Click here to download.
  1. ABC – See R02 Study Text, Chp 11
    Grab our taster mock exam paper for CII R02. Click here to download.
  1. D – See R03 Study Text, Chp 3
    Grab our taster mock exam paper for CII R03. Click here to download.
  1. C – See R04 Study Text, Chp 2
    Grab our taster mock exam paper for CII R04 Click here to download.
  1. D – See R05 Study Text, Chp 9
    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?

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