T 4

Question 1

purchaser executes a close-out?

Answer 1

Purchase at current market value all or any part of the securities necessary to complete the transaction
Execute the close-out no earlier than the third business day following the notice of close-out

Question 2

employee opening an account that can only purchase government securities or securities other then municipals

Answer 2

No notification or confirms needed by carrying firm.
When opening an account for an employee of another municipal securities firm, the carrying firm is required to give written notice to the employing firm only if the employee is executing transactions in municipal securities.

Question 3

advertising related to OS

Answer 3

Any advertising regarding municipal fund securities should contain a statement that more information is available in the issuer’s official statement and if the firm is the source of the official statement, it should also be disclosed

Question 4

The purchaser of a municipal security may initiate a close-out procedure no earlier tha

Answer 4

The purchaser of a municipal security may initiate a close-out procedure no earlier than the first business day following the settlement date

Question 5

If a trade is confirmed by both parties but a discrepancy exists,

Answer 5

ither party may void the transaction. However, if voiding the transaction is to the dismay of either party, legal recourse may be taken. Typically, such a discrepancy will be taken to arbitration if a compromise cannot be reached.
sellers price stands unless overruled by arbitration

Question 6

A municipal securities dealer operates an online data base of municipal securities based on the securities the firm holds in inventor

Answer 6

The suitability rules concerning these types of search engines differ in the municipal securities industry as compared to the equity securities industry. There is no central exchange trading municipal securities and the number of municipal securities is extremely large resulting in a fragmented market. Since the online database in this question is based only on the municipal securities the firm holds in inventory, the client is limited in her selection. Given these facts, the firm would be making a recommendation

Question 7

Build America Bonds (BAB

Answer 7

BABs pay taxable interest but the Treasury will reimburse 35% of the interest paid on the bonds to the issuer, which reduces the cost of borrowing.
Note not a tax credit

Question 8

Municipal securities confirmation exemption

Answer 8

A municipal securities dealer must maintain copies of all confirmations regarding the purchase or sale of municipal securities, as well as other notices sent to customers concerning debits and credits to customer accounts. Confirmations (and therefore records) of each transaction in municipal fund securities are not required provided the clients receive a periodic statement (and the firm maintains these records) showing the purchase or sale and investment earnings of municipal fund securities

Question 9

According to MSRB rules pertaining to the reporting requirements for interdealer transactions,

Answer 9

They must only be reported by one side and monitored by the contraparty

Question 10

reporting contributions on g-37/g-38

Answer 10

firms must keep records of all contributions but they only report those over $250.00

Question 11

Regarding the MSRB underwriting assessment for municipal securities dealers,

Answer 11

The fee when applicable is $.0275 per $1,000 of face value.
The fee is payable on all maturities underwritten if the final maturity is more than nine months.
In a syndicate account the manager makes payment on behalf of the participants.
The fee is payable not more than 30 calendar days after the invoice is sent by the MSRB.

Question 12

re transmittal of info from issuer

Answer 12

The firm must demonstrate that it has made a reasonable effort to retransmit any official communication to the beneficial owner of the securities. The firm may seek reimbursement for the costs of retransmittal concurrently with the retransmission of the information

Question 13

who can supervise municipal sales to other delears

Answer 13

only a 53

Question 14

Oftentimes, a state agency will enlist the services of a broker-dealer to market the state’s qualified tuition plans. When serving in this capacity, the firm would be known as a:

Answer 14

Primary distributor

Question 15

The time limitation for submitting disputes to arbitration is:

Answer 15

6 years

Question 16

If municipal bond transactions fail to compare at a registered clearing agency, the broker-dealer or municipal securities dealer submitting the transaction for comparison must reconcile the trade using procedures of the registered clearing agency or MSRB:

Answer 16

he broker-dealer or municipal securities dealer submitting the transaction for comparison must resolve the discrepancy as soon as possible.

Question 17

A purchaser’s close-out notice may be initiated:

Answer 17

No earlier than one business day after the original settlement date

Question 18

RTRS Time Frames

Answer 18

The RTRS system is in operation each business day from 7:30 a.m. to 6:30 p.m
data submission by reporting members is allowed between 7:00 a.m. and 8:00 p.m.

Question 19

All nonsupervisory branch offices must be inspected

Answer 19

at least once every three years

Question 20

what type of office does order execution

Answer 20

executing orders makes it an OSJ

Question 21

The following descriptive information must be disclosed on a municipal securities customer confirmation

Answer 21

The name (portfolio) used by the issuer to identify the securities purchased by the customer in order for the client to differentiate the securities from other municipal fund securities sold by the issuer
For variable rate securities, the interest rate is shown as variable. Since the interest rate is not known, the customer's first coupon payment would not be disclosed.
In the case of revenue bonds, a notation of the primary source of revenue backing the bonds (project name) must be disclosed.
For securities with additional credit backing (insured or letter of credit), the name of the company and/or bank that is obligated to make payments must be disclosed.

Question 22

In the case of an agency order on behalf of a joint account the order ticket

Answer 22

The date and time of receipt of the order
The price of execution of the order
The name and address of the person entering the order

Question 23

If a dealer solicits business and the transactions bill be executed by another dealer

Answer 23

If a primary dealer solicits municipal fund securities business that will be effected by another dealer, the other dealer must also be indicated in any promotional ads

Question 24

A syndicate manager offering municipal notes is required to confirm a sale to a dealer in which Situation

Answer 24

A syndicate manager is required to confirm the sale of municipal securities to either a syndicate member or to the dealer that submitted a related portfolio order, an order for a municipal securities unit investment trust, or an order for an accumulation account established for a municipal securities investment trust. An investment portfolio of a dealer (whether or not they are a member of a syndicate) is an example of a related portfolio. Although all customers purchasing municipals will receive a confirmation, MSRB Rule G-11 requires the syndicate manager to confirm the sales of these types of orders to the dealer placing the order.

Question 25

broker to broker transactions

confirmation delivery

Answer 25

The trade confirmation must be sent on the trade date

Question 26

issuer prepared OS

Delivery Requirements

Answer 26

When an official statement in final form is prepared by or on behalf of an issuer, the managing underwriter, upon request, is required to provide copies to any dealer that has purchased the securities. The managing underwriter is required to send one copy plus one additional copy per $100,000 par value of the securities purchased by the dealer. In addition, information and instructions must be provided on how to order additional copies directly from the printer.

Question 27

The latest date a close-out can be completed is:

Answer 27

The last date a close-out can be completed is normally 10 calendar days after settlement, unless the buyer extends for an additional 10 calendar days, which allows for it to occur 20 calendar days after settlement

Question 28

nonbranch locations should be reviewed

Answer 28

periodically

Question 29

brokers broker

Bids in error

Answer 29

If the bid is outside the parameters no permission is needed to contact the bidder.
If the bid is inside the parameters but believed to be made in error then permission is needed to contact the seller.