Section 6

Question 1

What systems and controls must a firm have in place to manage conflicts? (SYSC)

Answer 1

• Prepare, maintain and implement a conflicts policy
• Organisational arrangements such as Chinese Walls
• Disclose in a durable medium any conflicts (last resort)

Question 2

Conflicts of interest policy

Answer 2

• In writing
• Identifies potential conflicts relevant to the firm’s operations
• Specifies procedure to manage the conflicts
• Provide retail clients (and potential retail clients) with a description of the policy

Question 3

What are chinese walls?

Answer 3

Internal arrangements to restrict the flow of confidential information between departments.

Question 4

When a firm publishes research to its clients or the public, what must it ensure?

Answer 4

• That it does not receive inducement from those with a material interest
• Not to promise issuers favourable coverage
• Issuers covered are not permitted to review drafts of the research

Question 5

An FCA firm must not knowingly deal for its own account until the clients for whom the
publication was intended have had a reasonable time to react to it unless:

Answer 5

• The firm is a market maker dealing in the normal course of business
• Unsolicited client (including eligible counterparties) orders