Friday Five Focus on Regulation – 11 June – 5 Questions in 5 Minutes

Friday Five Focus on Regulation – 5 Questions in 5 Minutes Every Friday

What’s this all about?

Each week, we ask questions relating to one of these topics: Investments, Taxation, Pensions, Protection, or Regulation. This week, our Friday Five is relevant to Regulation; this is useful as you prepare for either of the CII’s R01 or CF1 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. They do not relate to tax year 2021/22 which is only examinable by the CII from 1 September 2021.

1. Regulated larger firms must maintain resources to cover risks and must carry out risk assessment and stress testing scenarios as required by the:
   1. Fixed Overheads Directive.
   2. Financial Resources Directive.
   3. Capital Adequacy Directive.
   4. Capital Requirements Directive.

2. What is the purpose behind the Upper Tribunal (Tax and Chancery Chamber)?
   1. Where the FCA enforcement officers present their findings from an investigation
   2. It is the appeal body for those objecting to FCA disciplinary decisions
   3. Where the more serious criminal prosecutions decisions are heard
   4. To allow suspicious activity to be reported

3. The FCA has a power of intervention which includes banning products. It will only be allowed to use this power in relation to which of the following?
   1. High net worth clients
   2. Corporate clients
   3. Retail customers
   4. Institutional customers

4. Each of the following has a 30-day cancellation period with the exception of:
   1. a life policy.
   2. an enterprise investment scheme.
   3. a pension transfer.
   4. a stakeholder pension contract.

5. Where a non-real-time financial promotion refers to a particular tax treatment, a firm must ensure that it prominently states that the tax treatment:
   1. may be subject to change in the future.
   2. is correct to the best of their knowledge and belief.
   3. can lead to a reduction in expected returns.
   4. will be the same for each investor.

Answers

1. D – See R01 Study Text, Chp 6
   Grab our taster mock exam paper for CII R01. Click here to download.

2. B – See R01 Study Text, Chp 6
   Grab our taster mock exam paper for CII R01. Click here to download.

3. C – See R01 Study Text, Chp 5
   Grab our taster mock exam paper for CII R01. Click here to download.

4. B – See CF1 Study Text, Chp 11
   Grab our taster mock exam paper for CII CF1 Click here to download.

5. A – See CF1 Study Text, Chp 11
   Grab our taster mock exam paper for CII CF1. 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.