Learning objective 10 & 11 Flashcards
M79. Which of the following statements regarding the Senior Managers and Certification Regime is correct?
A. All certified individuals must have a ‘Statement of Responsibilities’
B. All certified individuals must be pre-approved by the regulator
C. Senior managers have a ‘statutory duty of responsibility’
D. The Conduct Rules apply to senior managers only
C
M80. Under the Senior Managers and Certification Regime, under whose remit does it fall to confirm that a certified individual is fit and proper to undertake their role?
A. The firm’s
B. The individual’s, under self-certification
C. The Financial Conduct Authority’s
D. The Chartered Insurance Institute’s
A
M81. Which of the four key components identified by the FCA as being central to a firm’s ethical culture is about how well equipped a firm’s people are to exhibit the ethical behaviours expected of them?
D. Capabilities
M82. Corporate culture within an organisation is often reflected in a company's: A. report and accounts B. headed paper C. individual job descriptions D. values statements and ethics codes
D
M83. How do good business ethics make good business sense?
A. By demonstrating an awareness of ethical investments, a firm displays the breadth of their knowledge
B. Good business ethics usually translates into wealthier customers being attracted to the firm
C. A strong ethical culture helps build trust and confidence among consumers increasing their engagement with firms and products
D. Good business ethics always leads to higher rates of commission
C
M84. What is the purpose behind a firm’s ethics code?
A. Sets out the firm s ethical commitment in high level terms, and often also includes more specific regulations for specific responsibilities
B. Details the investment processes for clients wishing to consider ethical investment
C. To specify the rules of conduct the firm expects from all advisers
D. To visually demonstrate, to all staff, the commitment via internal promotion e.g. intranet sites. staff room posters
A
M85. Of the following types of management information (MI) that can give an insight into a firm's attention to ethical issues, which is most likely to help identify fairness issues? A. Customer complaints B. Employee ethics training C. File reviews D. Sales volumes
A
M86. According to a guide published by the regulator. good management information should be:
A. Accurate, timely, relevant and consistent
M87. Which of the following would be classed as an indirect measure of ethics?
A. Customer complaints
B. Ethical feedback in employee surveys
C. Employee engagement with ethic training
D. Regulatory guidance
C
P83. The Financial Conduct Authority’s Code of Conduct (COCON), expects senior managers to
A. complete bi-annual testing on money laundering rules and complaints handling.
B. act with integrity at all times.
C. take additional qualifications at least once every two years to maintain professional knowledge.
D. always consider compliant outcomes rather than ethical outcomes.
B
P84. Nigel is a senior manager with a large bank’s financial advice team and is advising Robert on retirement and investment planning. Robert has disclosed to Nigel that his net profit last year was £7,500, but, as a self-employed landscape gardener, he regularly accepts cash payments for work completed and does not declare this additional income to H M Revenue & Customs (HMRC). Considering solely the ethical requirements of the Financial Conduct Authority’s Statements of Principle and Code of Practice for Approved Persons (APER), what action should Nigel take if any with regard to Robert’s additional income?
A. He needs to not take any action as Robert is contributing less than £7,500 per annum to his pension.
B. Report his concerns to the bank’s Money Laundering Reporting Officer.
C. Report his additional income to the pension provider immediately.
D. Report this matter to HMRC.
B
P85. When establishing a new risk profile questionnaire for its clients, an authorised firm should consider the use of
A. clearly-phrased and unambiguous questions.
B. additional charts and graphs.
C. technical phrases and abbreviations.
D. open questions.
A
P86. Janine has joined an authorised firm as a senior manager and overhears one of the staff members, Tim, discussing how he takes advantage of the firm’s lax accounting procedures to handle stolen cheques. He suggests that Janine may wish to become involved in the illegal activities. What action should Janine take?
A. Ask Tim to explain his actions and then dismiss him.
B. Dismiss Tim immediately without further recourse.
C. Report the matter immediately to the firm’s compliance officer without saying anything to Tim.
D. Tighten the firm’s accounting procedures to restrict the illegal activities where possible.
C
P87. A financial adviser engages in ethical behaviour. The outcome of this for a client is most likely to be
A. advice which meets the client’s needs.
B. receipt of recommendations which are socially and ethically responsible.
C. product recommendations that focus on stakeholder contracts.
D. a waiver of Financial Ombudsman Service referral rights.
A
