Chapter 8

Question 1

67. What is the Money Advice Service?
    A. A website and helpline offering clear and impartial information for consumers
    B. A research website designed to assist authorised firms
    C. A debt counselling service for consumers who face debt problems
    D. A web based regulated firm for clients who do not want face to face advice

Answer 1

A -

Question 2

68. Remuneration for financial advice is in the form of a fee and is structured as a
    customer agreed remuneration. This is commonly known as:
    A. a disclosure document
    B. terms of business
    C. adviser charging
    D. menu of charges

Answer 2

C -

Question 3

69. Each of the following is classed as giving restricted advice with the exception of? A. Whole of market adviser
    B. Single-tied adviser
    C. Independent financial adviser
    D. Multi-tied adviser

Answer 3

C -

Question 4

70. Which of the following statements regarding stakeholder products and basic advice is TRUE?
    A. There is a short term collective or life stakeholder product
    B. A full fact find is completed
    C. The recommended product only has to be suitable, not the most suitable
    D. Providers of the deposit-based product can charge an annual management
    charge of 1.5% in the first ten years

Answer 4

C -

Question 5

71. What must a non-real time financial promotion include?
    A. Past performance data for the past 5 years
    B. That tax may be subject to change in the future
    C. The shelf life of the promotion
    D. Name of firm and address or contact point

Answer 5

D -

Question 6

93. What are the main provisions under the E-commerce directive rules? Tick all that apply.
    A. FCA status disclosure and Financial Services Register number must be given.
    B. Orders must be accepted.
    C. Customers must be told clearly how to place an order.
    D. Orders must be acknowledged within 24 hours of receipt.

Answer 6

A, C

Question 7

94. What must be included within the Key Information Documents produced by the marketing departments of product providers? Tick all that apply.
    A. Personalised illustration
    B. Aims of the investment
    C. Cancellation rights
    D. Future benefit projection
    E. The website address of MaPS

Answer 7

B, C

Question 8

95. Under the status disclosure rules, what should an adviser confirm to a retail client on first contact where advice or arrangements in packaged products are contemplated? Tick all that apply.
    A. How to complain
    B. The firm’s regulatory status
    C. Investment objectives
    D. Withdrawal rights

Answer 8

A, B

Question 9

96. What forms of costs and remuneration must a firm disclose before selling a packaged product via its agent? Tick all that apply.
    A. Any remuneration due to its agent
    B. The cost of supervising the agent
    C. The cost of regulating the agent’s firm
    D. The proper value of the agent’s pension benefit

Answer 9

A, D

Question 10

97. What are the differences between best execution and execution only sales? Tick all that apply.
    A. Execution only cannot happen with stocks and shares, but this is where best
    execution is most likely to happen
    B. With an execution-only transaction on a complex product, the firm is required to assess the appropriateness, but under best execution the firm is required to carry
    out the instruction
    C. Best execution does not apply to life or pension contracts. Although rare,
    execution only can apply to this field
    D. Best execution involves financial advice, but execution only is where the client
    has received no advice

Answer 10

B, C

Question 11

98. Which investments have a 14-day cancellation period? Tick all that apply.
    A. Lifetime ISA with face-to-face advice
    B. Enterprise Investment Scheme with face-to-face advice
    C. Opening a cash ISA with face-to-face advice
    D. Personal pension contracts

Answer 11

B, C

Question 12

99. You are meeting with your clients Rory and Gwyneth at the end of March for an annual review. Which of the following financial planning opportunities would usually be addressed at the end of a tax year? Tick all that apply.
    A. Re-assessing a client’s goals
    B. Using up ISA allowances
    C. Utilising the CGT exempt amount
    D. Reviewing a client’s protection arrangements
    E. Utilising pension contribution limits

Answer 12

B, C, E

Question 13

100. In relation to vulnerable customers, financial advisers should be aware that: Tick all that apply.
     A. vulnerable customers are people who require an additional duty of care.
     B. vulnerability is a permanent state of affairs.
     C. only older people should be considered as being vulnerable.
     D. equity release customers are considered to be vulnerable.

Answer 13

A, D