M5 Mock Exam 4
M5 Mock Exam 4
M5 Mock Exam 4
(4th Edition)
Mock Exam 4
(C1/S2)
1 Which of the following is the objective of Monetary Authority of Singapore?
(C1/S5.1.1)
2 Which of the following is not one of the values underpinning LIA and its members?
A. Fair in how they strive to provide favourable outcomes to both their policy owners and
shareholders
B. Professional in the way they conduct themselves and in the counsel they give
C. Excel in achieving sales targets and generate higher revenues
D. Ethical in ensuring policy owners’ interests are managed with utmost integrity
(C1/S2)
3 Choose the best answer representing the mission of MAS:
A. To promote sustained and inflationary growth and a sound financial services sector
B. To promote economic growth and progressive financial services sector
C. To promote non-inflationary growth and to develop Singapore as an international financial
centre
D. To promote sustained and non-inflationary economic growth and a sound and
progressive financial services sector
(C1/S4.2.1)
4 Which of the following is not IMAS code of Ethics?
A. Members shall be fair in how they strive to provide favourable outcomes to both the
policyholders and shareholders
B. Member shall act with competency and strive to maintain competency
C. Member shall conduct themselves with integrity and professionalism and act in ethical
manner in all their dealings
D. Members shall exercise due diligence and professional judgment in their conduct of their
business
(C1/S3.1)
5 Which of the following regulatory functions is not from Singapore Exchange Ltd (SGX) related?
A. Market Surveillance
B. Risk Management
C. Member Supervision
D. Client Relations
(C1/S4.2.2)
6 Which is the area not covered by IMAS standards of Professional Conduct?
A. Compliance
B. An Investment Manager
C. Business Conduct
D. Client Relations
(C1/S7)
7 Which of the organization was formed primarily to represent licensed financial advisers (firms)
who provide advice on sale of financial products? Exempt FAs are associated members.
(C2/S4.5)
8 Which of the following is not excluded from the definition of investment product under FAA?
(C2/S3.1)
9 “Financial Advisers are required to have a reasonable basis for their recommendations.” This is
one practical application of which principle underpinning the FAA?
A. Customer’s Interest
B. Consistency
C. Accountability
D. Independence
(C2/S4.1)
10 Which of the following is included in the definition of Financial Advisor?
A. Law Corporation
B. Finance Company
C. A bank licensed under the Banking Act (Cap.19)
D. The Public Trustee in exercising his powers under the Public Trustee Act
(C2/S4.5)
11 Under the FAA, “Investment product” means:
A. Loans
B. Mortgages
C. Life Insurance Policies
D. Fire Insurance Policies
(C2/S3.2)
12 Which principle underpinning the FAA and FAR causes financial advisers from different
distribution channels being subject to the same rules and standards?
A. Customer’s Interest
B. Consistency
C. Accountability
D. Independence
(C2/S2)
13 Which of the following is not a function of the Financial Advisers Regulation (FAR) prescribed by
MAS?
(C2/S3.1)
14 Which of the following with regard to principles of FAA and FAR is true?
(C2/S7.1)
15 Section 32 of the FAA requires every licensed FA to establish and maintain a separate account
with a bank licensed under the Banking Act for its life insurance premium.
(C2/S9.2)
16 Which of the following is not included in the Public Register of Representatives under Section
63A of FAA for Representative Notification Framework (RNF)?
A. Current and past types of financial advisory service provided by him, and the date of
commencement and cessation (if any) of such service
B. Residential address of the Financial Adviser Representative
C. Name of the Financial Adviser Representative
D. Disciplinary proceedings or other action taken by the MAS against him and published
under Section 67 of the FAA
(C3/S3)
17 Under Section 26 of the FAA, a licensed FA who make a false or misleading statement as to any
amount that would be payable in respect of a proposed contract in respect of any investment
product shall be liable on conviction to
(C3/S17)
18 Under Section 83 of the FAA, where an offence committed by a body corporate has been proven
attributable to any neglect on the part of an officer of the corporate, the officer and the
corporate shall be guilty of the offence, The officer can mean:
A. The Representatives
B. Member of the Committee of Management
C. Supervisor of the Representative
D. Clerk
(C3/S19)
19 Under Section 85 of FAA, any officer or agent of a licensed FA who willfully makes a false entry,
or omits, alters, extracts, conceals or destroys an entry in any book, report, slip, document or
statement of the business, transactions, conditions or assets of the FA shall be guilty of an
offence and be liable on conviction
(C3/S2)
20 Which of the following is not one of the material information for disclosure to client relating to any
designated investment product during recommendation?
A. Benefit and risk that may arise from the designated investment product
B. Terms and conditions of the designated investment product
C. Sales targets of the FA Reps on the designated investment product
D. Premiums, cost, expenses, fees or other charges that may be imposed in respect of the
designated investment product
(C3/S3)
21 Under Section 26 of the FAA, any licensed FA who has the intention to deceive, make a false or
misleading statement shall be guilty of an offence and shall be liable on conviction to a fine
A. ≤ S$20,000
B. ≤ S$50,000
C. ≤ S$20,000, or imprisonment ≤ 6mths, or to both
D. ≤ S$50,000, or imprisonment ≤ 12mths, or to both
(C3/S5.2)
22 Which of the statement is not true for Regulation 19 of FAR?
Money received shall be handed over to ______ not later than the business day immediately
following the day after money received
A. I
B. II
C. III
D. None of the above
(C4/S4)
23 Which of the following is true for Dual Currency Investment?
(C4/S2)
24 The “Notice on Recommendations on Investment Products” does not apply to which products?
A. Personal Loans
B. Mortgage Reducing Term Plans
C. Investment Link Policy
D. Whole Life Policy
(C4/S2)
25 The “Notice on Recommendations on Investment Products” is to ensure:
(C4/S2.4.1)
26 Concerning the “Know Your Client” aspect under the “Notice on Recommendations on Investment
Products”, what should the FA highlight in writing to its client?
A. The information provided by the client will be the basis on which the recommendation will
be made
B. The recommendations by the FA are sound and appropriate regardless of information
given by client
C. Any inaccurate or incomplete information provided by client may not affect the suitability
of the recommendation
D. FA will not proceed with any recommendation unless client provide complete information
(C4/S2.4.3)
27 When making a recommendation on Life Policy, which of the following documents will be
applicable under the requirement of Documentation and Record Keeping?
(C4/S3.4)
28 Which of the following information need not be disclosed by the FA Rep to his clients in writing?
A. His name
B. The FA(s) for which he acts
C. Type of FA services that he provides
D. Remunerations that both related and unrelated to its provision of financial advisory
services
(C4/4.2)
29 Advisers providing financial advisory services to a client on dual currency investment should
provide these appropriate risk warnings:
A. Issuer has the right to repay you at a future date in the currency of their choice
B. Principal sum will be the base amount initially invested, hence loss is minimal
C. Investment may results in the client receiving less than the principal amount initially
invested, when the amount in the alternate currency is converted back to the base
currency
D. Issuer has no right to repay the principal sum at maturity in an alternate currency
(C4/S2.5)
30 A FA should not make a recommendation to a client to switch from one designated investment
product to another if:
(C4/S2.4)
31 In which requirement under the principle of Customer’s Interest states that as a representative,
you should understand your customer’s financial objectives, situation and risk tolerance?
(C5/S5.2)
32 Any person who acts or holds himself out to be an appointed representative of a FA must:
(C5/S2.1)
33 “Introducing Activity” means:
(C5/S2.2)
34 Which of the following does an introducer required to comply with if he agrees to do the
introducing job for the financial adviser?
A. The introducer must help to perform the needs analysis for the client
B. The introducer has to try to explain and provide advice and opinion on the investment
product
C. The introducer has to get involved in the provision of the financial advisory service as
provided for by the FA
D. The introducer has to disclose to all the clients whether or not he will be remunerated
by the financial adviser for carrying out introducing activities
(C5/S5.2)
35 Which of the following is not a category of individual to re-take and pass CMFAS Module 5 before
providing any financial advisory service?
A. Individual who passed M5 but did not commence any advisory service with a FA
within 3 years from date of passing
B. Individual who passed M5 but did not commence any advisory service with a FA
within 5 years from date of passing
C. Individual who passed M5 but subsequently ceased providing financial advisory
service for a FA within 3 years from date of cessation
D. Individual who has completed non-examinable course on M5 by 30 November 2003
(C5/S2.1)
36 Concerning appointment and use of introducers by FAs, which of the following activities is
prohibited to be performed by an introducer?
(C5/S4.1)
37 Which of the following is not an entry requirement for any individual to be a provisional
representative?
(C5/S5.1.3)
38 Any representative of a FA who is advising on and/or arranging life policies (whether or not
including investment-linked life insurance policies) requires _____?
(C5/S6.1.3)
39 FA shall report to MAS not later than ___ upon discovery of Reps involve in inappropriate advice,
misrepresentation or inadequate disclosure of information.
A. 7 days
B. 14 days
C. 1 months
D. 2 months
(C5/S5.1.3)
40 Any representative of a FA who is advising others concerning futures contracts requires _____?
(C6/S6.5)
41 Notice No: FAA-N14 on “Reporting of Misconduct of Reps by FAs” takes effect from 1 Jan 2011.
A FA is responsible for the conduct of its Reps for any misconduct committed by them in
relation to the provision of any financial advisory service. The type(s) of disciplinary actions may
be taken by the FAs on the Reps includes:
A. I only
B. II and III
C. I, II and III
D. All of the above
(C6/S11.2)
42 What is Money Laundering?
A. A process intended to mask the benefits derived from drug trafficking or criminal conduct
so that they appear to originate from a legitimate source
B. A process intended to transfer the benefits derived from drug trafficking or criminal
conduct so that the police will not be able to track
C. A process intended to diversify the benefits derived from drug trafficking or criminal
conduct so that the police will not be able to track
D. A process intended to distribute the benefits derived from drug trafficking or criminal
conduct so that they appear to have originated from legitimate source
(C6/S11.16)
43 Which of the following is not the responsibility of the AML/CFT compliance officer?
(C6/S11.2)
44 Which of the following stage is not part of Money Laundering?
A. Placement
B. Integration
C. Layering
D. Legalization
(C6/S11.15)
45 The FA should ensure that the internal process for evaluating whether a matter should be
referred to Suspicious Transactions Reporting Office (STRO) be completed without delay and
not exceeding ___ working days of the case being referred.
A. 5
B. 10
C. 15
D. 30
(C6/S11.8)
46 Which of the following is true of Non Face to Face verification?
(C6/S9)
47 A system for reporting Suspicious Transactions involves:
A. Establish a single reference point within the organization for reporting suspicious
transaction
B. Maintain proper records for all daily sales transactions
C. Making notifications by telephone to STRO for all suspicious transactions
D. FAs are required to have elaborate systems to help identify suspicious transactions
(C6/S6)
48 Under Enhanced Customer Due Diligence, “politically exposed person” means:
(C6/S4.2)
49 A FA shall perform Customer Care Diligence in accordance with the Notice No: FAA-N06 when
A. I & II
B. II &III
C. I & III
D. All of the above
(C6/S9)
50 A FA shall consider if the circumstances are suspicious so as to warrant the filing of an STR and
document the basis for its determination when the following occurs, except:
(C7/S2.2)
51 According to Notice No: MAS 302 on “Notification For Products Launched”, an insurer should
notify the MAS in writing of any product launched by the insurer that does not require the
approval of the MAS. Such notice should be given to the MAS within _____ after the official
launch date of the product?
A. 3 working days
B. 7 working days
C. 14 working days
D. 1 month
(C7/S3.2.11)
52 To allow an insurer to launch a feeder ILP sub-fund where more than 10% of the assets of the
ILP sub-fund will be invested in Collective Investment Schemes authorized in a foreign
jurisdiction, MAS will consider:
(C7/S3.1.5)
53 Which of the following is not true under Notice No: MAS 307 on “Investment-Linked Insurance
Policies - Disclosure”?
The insurer shall prepare, or cause to be prepared for each ILP and ILP sub-fund:
(C7/S2.2.1)
54 Under Notice No: MAS 302 on “Product Development and Pricing”, which of the following
requires Insurer to seek MAS approval in writing?
(C7/S3.1)
55 Under Notice No: MAS 307 on Part I – Mandatory Requirements for Investment-Linked Life
Insurance Policies, an insurer shall notify the MAS of the insurer’s intention to launch any ILP
sub-fund at least ______ the ILP sub-fund is established
A. 14 days after
B. 21 days after
C. 14 days before
D. 21 days before
(C7/S3.2.4)
56 Which of the following is not a mandatory requirement of Notice No: MAS 307?
(C7/S3.1.4)
57 For ILP sub-funds which are terminated or matured, an insurer shall retain a copy of the audit
certificate for a period of ____, from the date of termination or maturity of the ILP sub-fund.
A. 1 year
B. 2 years
C. 5 years
D. 6 years
(C7/S2.1.2)
58 Approval for the launch of a new ILP comes under:
A. MAS 302
B. MAS 307
C. Section 25 of the FAA
D. Section 36 of the FAA
(C7/S3.2.10)
59 Which of the following is not a mandatory requirement of Notice No: MAS 307?
A. When a valuation error in the calculation of an ILP sub fund’s NAV per unit, insurer
shall notify MAS of the error
B. Insurer’s intention to launch any ILP sub-fund
C. Audit of an ILP sub-fund
D. Provision of Product Summary and Policy to policy owners
(C8/S6.2)
60 Which of the following is considered an “Independent Financial Adviser”?
A. Bank
B. Fund Management Company
C. Life Insurance Company
D. Licensed Financial Adviser with no ownership links to product providers
(C8/S2.1)
61 A Financial Adviser (FA) licence will be granted to a _____.
(C8/S3.1.3)
62 Concerning the factors on financial soundness when assessing if a financial adviser or
representative is fit and proper, which of the following imply that such a party is not fit and
proper?
(C8/S2.1.2)
63 An applicant for a Financial Adviser (FA) licence must meet requirement(s) of:
A. I only
B. I & II
C. I, II & III
D. All of the above
(C8/S5.7)
64 Which of the following must be provided to the client when recommending any designated
investment product?
(C8/S3.1)
65 Which of the following would render a FA fit and proper?
A. Higher qualifications
B. Competence and incapability
C. Financial soundness
D. Has been issued a prohibition order under the Act by MAS for providing FA services
(C8/S8.1)
66 Which of the following is not a definition of “High Net Worth Individual” for an individual under
FAA Guideline No: FAA-G07?
(C9/S3.3)
67 Which of the following is not part of product information disclosure for Structured Deposit under
Guidelines No: FAA-G09?
A. Risk Factors
B. Fees and Charges
C. Early Termination clauses
D. Commission Structure of the FA Reps
(C9/S3.3.1)
68 Which of the statement is incorrect for illustration of Past and Future performance of a Structured
Deposit?
A. Illustrated Forecast on the economy is not necessarily the indicative of the future
performance of the Structured Deposit
B. Illustrated Forecast on the economy is the indicative of the future performance of the
Structured Deposit
C. Illustrated Past Performance is not necessarily indicative of the future performance
D. Illustrated Past Performance and Forecast on the economy do not indicate the future
performance of the Structured Deposit
(C9/S4.3)
69 Stated in Notice No: FAA-NO1, which of the following factor should a supervisor take into account
in considering whether a Switch of investment products is appropriate?
I. Whether the client will incur any transaction cost without gaining any real benefit from the
switch
II. Whether the FA Reps able to meet his sales target for that particular month
III. Whether the replacement product is less suitable for the client
IV. Whether the client suffers any penalty for terminating the original product
A. I & IV
B. II & III
C. I, III & IV
D. All of the above
(C9/S3.3)
70 Which of the following is true for “Structured Deposit”?
(C9/S5)
71 Which of the following is an incorrect Fair Dealing Outcome?
A. Outcome Four – Customers receive clear, relevant and timely information to make
informed financial decisions
B. Outcome Two – Financial institutions offer products and services that are suitable for
their target customer segments
C. Outcome Five – Financial institutions handle customer complaints in an independent,
effective and prompt manner
D. Outcome One – Financial institutions have competent representatives who provide
customers with quality advice and appropriate recommendations
(C10/S2)
72 MAS has issued a revised Code on Collective Investment Schemes pursuant to Section 321 of
the Securities and Futures Act (Cap. 28), and will come into effect on 1 Oct 2011. Which of the
following is not one of the key changes to the Code?
(C10/S2)
73 Under key changes to Collective Investment Schemes Code pursuant to Section 321 of the
Securities and Futures Act (Cap. 289), which is correct for “Introducing New Guidelines for
Specialised Fund Categories”?
A. I & II
B. II & III
C. I, III & IV
D. All of the above
(C10/S3.5)
74 Under Revised Code on Collective Investment Schemes, the manager should pay out redemption
proceeds to the participants within _____ for bond and money market schemes
A. T + 3 business days
B. T + 4 business days
C. T + 7 business days
D. T + 14 business days
(C10/S3.13)
75 Which of the following is not true to “Performance Fees Payable” under Revised Code on
Collective Investment Schemes?
(C10/S4.1)
76 Under Revised Code on Collective Investment Scheme, when assessing whether a name of
scheme is undesirable or misleading, the MAS will consider factor(s):
(C10/S6.4.2)
77 Under Revised Code on Collective Investment Scheme – “Dealing and Valuation”, Property
Funds should have a full valuation at least _____.
A. Every 3 months
B. Every 6 months
C. Once a year
D. Every 2 years
(C10/S10.3.1)
78 A Fund-of-Hedge-Funds (FOHF) refers to a scheme which the manager makes strategic or
tactical asset allocations across a range of hedge funds. The Minimum Initial Subscription
Requirement should be offered at:
(C10/S10.3.3)
79 Fund-of-Hedge-Funds (FOHF) should be sufficiently diversified in at least ____ hedge funds and
does not have more than ___% allocated in a single hedge fund.
A. 8 ;5
B. 10 ;6
C. 15 ;8
D. 20 ; 10
(C10/S11.2)
80 Under Revised Code on Collective Investment Scheme – Appendix 4 Capital Guaranteed Funds,
the guarantee may not be terminated:
(C11/S3.4)
81 For an individual to participate in SRS scheme, he must
A. I & II
B. II & III
C. III only
D. All of the above
(C11/S1.3.1)
82 Which of the following is not an option to invest the Minimum Sum?
(C11/S2.1.2)
83 Which is the following CPF LIFE non-refundable plan?
(C11/S1.3)
84 Which of the following not a CPF Account?
A. Ordinary Account
B. Savings Account
C. Special Account
D. Medisave Account
(C11/S2.3.1)
85 Penalty for false declarations and mis-use of property under the Public Housing Scheme, will
amount to:
(C11/S2.4)
86 Which of the following requirement is true under the CPF Investment Scheme?
(C11/S3.4)
87 Which of the following investment is not allowed under Supplementary Retirement Scheme?
(C11/S3.4)
88 A person is not allowed to contribute to SRS if he
(C11/S2)
89 Which of the following is not one of the Five Pillars of Financial Security under the CPF?
A. Healthcare Financing
B. Asset Enhancement
C. Job Security
D. Property Ownership
(C11/S2.1.1)
90 Which of the following scheme is an extension of the minimum sum scheme, to allow members to
buy an annuity from their withdrawal CPF savings from the specified withdrawal age?
(C12/S8.1.3)
91 Which is the type of Insurance Product protects against risk of loss of income if a person is
disabled?
(C12/S8.1.3)
92 Which is the type of Insurance Product that provides life cover for a fixed term?
(C12/S8.1.2)
93 Which of the following product could be used to meet Accumulation Needs?
(C12/S1)
94 Which of the following is not one of 6 stages under the sales advisory process?
A. I & II
B. I & III
C. I, III & IV
D. All of the above
(C12/S5.3)
95 How many options are there for client to choose in the fact-find form?
A. 2
B. 3
C. 4
D. 5
(C12/S6)
96 You are analyzing the data given to you by your client to identify and quantify his needs. Which
question is irrelevant?
(C12/S5.1.2)
97 Which of the following could not happen when a person retires?
(C12/S7.1)
98 Which of the following are the two basic principles under product recommendations?
(C12/S5.3.4)
99 Which of the following may not be considered as a Fixed Expenditure in Fact-Finding?
A. Housing
B. Investment
C. Insurance premiums
D. Income taxes
(C12/S5.3.4)
100 Financial information such as monthly income of your client is necessary to determine:
1 A 26 A 51 B 76 D
2 C 27 C 52 B 77 C
3 D 28 D 53 B 78 B
4 A 29 C 54 D 79 C
5 D 30 D 55 D 80 B
6 A 31 B 56 D 81 D
7 B 32 C 57 C 82 C
8 C 33 B 58 A 83 B
9 A 34 D 59 A 84 B
10 B 35 B 60 D 85 C
11 C 36 B 61 B 86 D
12 B 37 D 62 B 87 D
13 D 38 D 63 D 88 B
14 A 39 B 64 C 89 C
15 C 40 B 65 C 90 A
16 B 41 C 66 A 91 B
17 B 42 A 67 D 92 C
18 B 43 C 68 B 93 A
19 B 44 D 69 C 94 D
20 C 45 C 70 B 95 C
21 D 46 A 71 D 96 D
22 D 47 A 72 C 97 A
23 C 48 C 73 B 98 A
24 A 49 D 74 B 99 B
25 C 50 B 75 C 100 A