Brand FIn

Question 1

What is the general rule requirement under capital adequecy?

Answer 1

All businesses must be able to meet their financial obligations as and when they fall due.

Question 2

How are IFA Businesses affected by the FCA’s Capital Adequacy rules?

Answer 2

Some small IFA firms are exempt from these rules and are not required to undertake such a rigorous assessment.

Question 3

What is the maximum payout under the Financial Services Compensation Scheme for home finance mediation services?

Answer 3

100% of £85,000

Question 4

With regard to ARs and the people that work for them, it is true to say that..

Answer 4

An adviser appointed by an AR must be individually approved by the FCA
Directors and senior managers of an AR must be approved persons.

Question 5

The FCA has launched criminal proceedings against Geoff, a sole trader who falsely claimed to be FCA-authorised. This is most likely to mean that the FCA has

Answer 5

exercised their power to prosecute

Question 6

With a Lasting Power of Attorney, in order to make gifts, who must give approval?

Answer 6

Approval from the Court of Protection

Question 7

Which body has an overarching strategic objective to ensure that financial markets work well?

Answer 7

The FCA

Question 8

Josh has been unable to work due to long term sickness. The benefit cap does NOT apply to Josh because his mother, who he lives with, receives..?

Answer 8

Attendance Allowance

Question 9

As a result of the Mortgage Credit Directive, firms must now provide a binding mortgage offer and a minimum reflection period of how many days?

Answer 9

7

Question 10

On what basis, did the Capital Requirements Directive (CRD) divide capital into three tiers?

Answer 10

Three tiers based on loss absorbency and permeance of the capital

Question 11

Dylan is a pension transfer specialist. He has recently attended an intermediary seminar where he received a number of low-value gifts. Records of these benefits should be kept for how long?

Answer 11

Five years

Question 12

Kieran’s role specifically requires that he complete at least 15 hours of professional training or development a year. This suggests that he is most likely to be advising customers in relation to?

Answer 12

Insurances

Question 13

When considering the rules regarding cancellation notices and cancellation rights, it is correct to say that..?

Answer 13

The cancellation notice must be sent by the provider either by post or electronically
The cancellation right id only valid if served on the provider within the time limit

Question 14

Deborah, is struggling to make her monthly repayments on her numerous debts. Which of the following is a definition of a debt management plan that could help her?

Answer 14

An adviser negotiating with a client’s creditors to consolidate the debt into one affordable payment which is distributed to creditors via the adviser.

Question 15

How does the Insurance Conduct of Business sourcebook (ICOBS) categorise insurance products?

Answer 15

General insurance, pure protection, payment protection insurance

Question 16

What scenario might prompt a client review for a middle age couple with no dependants?

Answer 16

Introduction of new tax relief
An increase in interest rates
Changes to tax liabilities

Question 17

What scenario might prompt a client review for a middle age couple with no dependants?

Answer 17

Introduction of new tax relief
An increase in interest rates
Changes to tax liabilities

Question 18

Damien is fast approaching retirement and is a little confused by some of the terms in the paperwork he has received. Can you explain to him the difference between a compulsory purchase annuity (CPA) and a purchased life annuity (PLA)?

Answer 18

Only the income element of a PLA is taxable whereas the whole amount of CPA income is taxable

Question 19

How does ‘leadership’ differ from ‘strategy’ as a key driver for a company?

Answer 19

Leadership sets the tone of the business, drives staff behaviours and quality of decisions, strategy sets priorities and management focus.

Question 20

Cameron wishes to appeal against a decision of the Pensions Regulator. To which body should her appeal be made to?

Answer 20

The general regulatory chamber of the first tier tribunal

Question 21

Under the Consumer Rights Act 2015, what is the requirement for expressing significant terms?

Answer 21

The terms must be in plain and intelligible language.

Question 22

Which regulatory body does not have explicit responsibility for financial stability?

Answer 22

FCA

Question 23

Which international organisation provides recommendations to the EU on Money Laundering?

Answer 23

Financial Action Task Force

Question 24

Under anti-money laundering regulations, in which circumstances must a firm complete full customer due diligence?

Answer 24

When a regulated firm suspects ML or TF
When a regulated firm establishes a business relationship
When a regulated firm carries out an ad-hoc transaction

Question 25

Since the passing of the Friendly Societies Act 1992, FS are now able to apply for corporate status and..?

Answer 25

sell unit trusts, OEICs & ISAs

Question 26

Since the passing of the Friendly Societies Act 1992, FS are now able to apply for corporate status and..?

Answer 26

sell unit trusts, OEICs & ISAs

Question 27

Which body has a statutory function to develop a national strategy on financial capability, debt and financial education?

Answer 27

The Money and Pensions Service (MaPS)

Question 28

What regular reports must an authorised firm provide to the FCA?

Answer 28

Amount in client bank acc
persistency ratios
Number of complaints

Question 29

Apart from the periodic, application and special project fees, what other fees are due from authorised firms?

Answer 29

FOS, FSCS, MaPS

Question 30

What is the technical definition of a mortgage?

Answer 30

The security offered in exchange for the loan

Question 31

Key features illustrations provide -

Answer 31

Customers with information specific to their circumstances, personalised quotes and typical returns that may be expected

Question 32

Jim is considering an IVA as an alternative to bankruptcy. Which of the following is correct?

Answer 32

Jim will be notified when the IVA has ended

Question 33

What is MoneyHelper?

Answer 33

The consumer-facing brand of the Money and Pensions Service

Question 34

James has a well paid job with his employer but became sick and was off work for fourteen weeks. he is expected to be off a further ten weeks. What state benefits would he potentially receive?

Answer 34

Statutory Sick Pay

Question 35

Belinda understands as an FA she is required to evidence her adherence to the code of ethics and has asked how she should do so.

Answer 35

Statement of Professional Standing

Question 36

Which UK regulator is responsible for ensuring that large UK financial institutions do not pose a significant threat to the overall financial system?

Answer 36

Financial Policy Committee.

Question 37

Which of the following statements regarding ‘structured’ and ‘unstructured’ loans is incorrect?

Answer 37

Structured loans are viewed as lower risk than unstructured.

Question 38

Which of the following does the FCA not require to be included within a Key Features Document for an investment product?

Answer 38

Information required by the Solvency II directive.
Contact details of the firm arranging the investment.

Question 39

Which body has an overarching strategic objective to ensure that financial markets work well?

Answer 39

The Financial Conduct Authority

Question 40

Irene has taken out an income protection policy. If she becomes incapacitated and unable to work, when will her benefits be paid?

Answer 40

After a deferred period chosen by her

Question 41

Under the Sale & Rent Back regime, consumers are protected by

Answer 41

being owed a duty of care by an independent valuer

Question 42

Jared’s personal information was leaked as a result of a data security breach at his financial adviser’s firm. Jared believes he has suffered damage as a result of this breach. If Jared is deemed to be correct, who could award him compensation?

Answer 42

Court of law