CMFAS Module 5 Set B

CMFAS MODULE 5
5th Edition – Version1.4a

Set B

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CMFAS Module 5 Set B

Set B
C6/2.1(para 3)
1. Who is the “Beneficial Owner” in relation to a customer of a financial adviser?

A. A natural person who ultimately owns or controls a customer.

B. An individual who owns his policy.
C. Company who owns the master policy.
D. Foreign government entity.

2/2.1
2. The Financial Advisers Regulations (FAR) came into effect as a subsidiary legislation to give
effect to the provisions of the Financial Advisers Act. The FAR is prescribed by ______.

A. Singapore Exchange Limited

B. Monetary Authority of Singapore
C. Associations of Banks of Singapore
D. Life Insurance Association of Singapore

C2/3.2(B)
3. The concept of __________ must apply to processes for the same product. That means for
the same product, such as life insurance, advisers from different channels, would apply to the
same rules and standards.

A. Consistency
B. Accountability
C. Customer’s Interest
D. Fairness

C9C/Annex 1/5(b)
4. A financial adviser is expected to determine the fitness and propriety of a proposed
representative by having him:

A. conduct a yearly self-assessment of competency and capability to be a fit and proper

person.
B. maintain adequate documentation evidencing all certification that he is a fit and proper
Person
C. submit a written declaration that he has passed all the relevant examinations to be a fit
and proper person
D. be subjected to independent checks by its financial adviser, to ensure that he satisfies
the fit and proper requirements.

C5D/9(a)(ii)
5. Which one of the CMFAS Examinations will apply to an individual advising on and/or
marketing Collective Investment Schemes?

A. 9A
B. 7
C. 8
D. 9

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C9C/Annex 2/ 2,4 & 8

6. The MAS expects financial institutions to conduct rigorous and independent checks on the
fitness and propriety of their representatives. Which one of the following probity checks is not
required to conduct?

A. identity
B. marital status
C. financial status
D. past employment records

C6/6.9(b)
7. Where the customer appoints one or more natural persons to act on his behalf in establishing
business relations, FA shall:

A. Verify and question the customer’s authority.

B. Proceed, as customer’s authority is verified, hence no need to verify the natural persons.
C. Verify the identity of each natural person using reliable, independent source data,
documents or information.
D. Identify the legal form, constitution and powers that regulate and bind the legal person or
legal arrangement.

C10A/1.2
8. The MAS adopts a __________ approach in dealing with the conduct of business for
execution-related advice under the Guideline No:FAA-G08.

A. facilitative
B. principle-based
C. descriptive-based
D. prescriptive-based

C10A/1.4
9. “Execution activities” as defined under Regulation of the FAR means any or all of the following
except:

A. Capital market products quoted on an approved overseas exchange.

B. Trading in futures contracts
C. Arranging life insurance policies
D. Leveraged foreign exchange trading

C9D/1.20
10. Which one of the following is a standard in relation to the “due care and diligence” of a
financial adviser in conducting business with its customers?

A. Proper supervision of its representatives and their activities.

B. Adequate procedures for complaints handling.
C. Disclosure of information about the financial adviser.
D. Due compliance with applicable laws, rules and regulations.

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C1/2.4(c)
11. One of the principal objectives of the Monetary Authority of Singapore is to:

A. act as a dispute resolution centre for consumers

B. monitor trading activities of the securities market
C. manage the official foreign reserves of Singapore
D. serve as the banker to the population of Singapore

C13/2.10
12. The purpose of Workfare Income Supplement (WIS) Scheme is _____________.

A. to encourage older low wage workers to work by supplementing their income and
retirement savings.
B. for employees to receive their workfare in cash payments and contributions to their CPF.
C. to encourage older low wage workers to undergo training.
D. to encourage older low wage workers to undergo training and be able to supplement their
income and retirement savings.

C1/2.6
13. The Financial Advisers Act 2001is administered by:

A. Association of Financial Advisers

B. Monetary Authority of Singapore
C. Association of Banks in Singapore
D. Life Insurance Association of Singapore

C10D/1.19(d)
14 Which one of the following practices promotes customer confidence in financial institutions
where fair dealing is central to their corporate culture?

A. Whistle-blowers to report any misconduct.

B. Timely performance to meet sales targets.
C. Encouraging customer to switch investment products.
D. Persons taking deposits to also cross sell investment products.

C10D/1.54
15. As part of the delivery of fair dealing outcomes under the Guideline No: FAA-G11, which of the
following promotes competency of representatives in giving advice and appropriate
recommendations to customers? The financial institution aligns the remuneration structure
with:

A. product quotas
B. customer’s interest
C. differentiated fees and commissions
D. the complexity of the investment product

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C14/2.1
16. Which one of the following is/are true regarding the benefits of conducting needs analysis for
your clients?

A. help him discover the client’s needs

B. allow him to analyse the client’s situation and needs
C. sell the products to the client based on his needs and objectives
D. all of the above

C3/14.2
17. The objective(s) of prohibition orders under the Financial Advisers Act is/are to:

A. allow the person, subject to any condition specified in the order to do specified acts.
B. prohibit the person from engaging in any or all of the financial advisory services regulated
under the FAA.
C. prohibit the taking part in the management of, acting as a director or becoming a
substantial shareholder of a licensed or exempt adviser
D. All of the above

C5D/9(b)
18. Which one of the CMFAS Examination will NOT apply to an individual who wishes to advise
on and/or arrange life policies, including Investment-linked policies?

A. 5
B. 6
C. 9
D. 9A

C10D/1.75
19. Under Fair Dealing Outcome Five, what is the rationale concerning a financial institution’s
handling of customer complaints for the delivery of fair dealing outcome?

A. Complaints are handled by the head of compliance.

B. Complaints are dealt with by the Board of Directors.
C. Complaints are potential indicators of areas for improvement.
D. Complaints are referred to the Monetary Authority of Singapore.

C14/3.2
20. The six stages of the Sales Advisory Process designed to assist a prospective client in
identifying his financial needs do not include:

A. Ask his client for referrals.

B. Review with the client periodically.
C. Develop and present recommendations.
D. Establish and define client-representative relationship.

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C12/1.2
21. Which one of the following statements on the Revised Code on Collective Investment
Schemes (Code) is False?

A. The Code is statutory in nature.

B. The Code is applicable to ILPs.
C. The Code is to enhance safeguards for retail investors.
D. The Code is issued by the MAS.

C12/9B/3.1
22. The global exposure of a Collective Investment Scheme to financial derivatives or embedded
financial derivatives should Not exceed ________ per cent of the scheme’s Net Asset Value at
all times.

A. 10
B. 30
C. 50
D. 100

C4B/3/11(a)(ii)
23. Which one of the following is NOT a principle of general disclosure requirements when making
statements to a prospective client under the FAA?

A. Statements are to be made in plain language and in a simple manner.

B. Statements are to be made in accordance with industry best practices.
C. Statements are to contain adequate information to make an informed decision.
D. Statements are to avoid jargon and technical terms for the client to ensure clarity of
information.

C4B/4/12
24. Under the Financial Advisers Act, concerning general information about the Financial Adviser
(FA), a FA does not need to disclose, in writing, to the clients the:

A. FA’s business name, address and telephone number

B. details of the product providers that the FA recommends to his client
C. details of all the appointed and provisional representatives registered in the Public
Register of Representatives
D. types of financial advisory services that it is authorised to provide

C3/1.1(e)
25. Under the FAA, a licensed financial adviser is NOT required to disclose which one of the
following material information to a prospective client?

A. Benefits and risks of the designated investment product.

B. Fees and charges imposed on the designated investment product.
C. Name of the reinsurer if the designated investment product is a life policy.
D. Relationship between the licensed financial adviser and the product provider.

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C3/6.1
26. Every licensed financial adviser which receives any insurance moneys shall establish and
maintain a separate account with a _________for its life insurance broking premiums.

A. bank
B. trust company
C. finance company
D. reinsurance company

C2/4.7
27. According to the Financial Advisers Act, exempt financial adviser firms include:

A. banks licensed under the Banking Act 1970

B. companies registered under the Insurance Act (Cap 142)
C. holders of capital markets services licenses under the Securities and Futures Act 2001
D. all of the above

C2/4.7(c)
28. Section 20(1) of the FAA provides that the following persons shall be exempted from holding a
financial adviser’s licence to act as a financial adviser in Singapore in respect of any financial
advisory service:

A. A company licensed under the Insurance Act.

B. An approved trustee under the Securities and Futures Act.
C. An accounting corporation registered under the Accountants Act.
D. A law corporation registered under the Legal Profession Act.

C9B/1.13(e)(i)
29. Under MAS Guideline on Fit and Proper, which corporation is not financially sound?

A. some cash-flow problems

B. problems securing new customers
C. problems in paying some of its creditors
D. a winding-up petition against it in Singapore or elsewhere

C2/4.8
30. Under the First Schedule of the FAA, the following persons are defined as “excluded financial
advisers” except ______________.

A. The Public Trustee in exercising its powers under the Public Trustee Act.
B. The Official Assignee in exercising its powers under the Bankruptcy Act.
C. A public accountant in exercising its powers in relation to a company under the
Accountants Act and whose providing of any financial advisory service is solely incidental
to the accounting practice, as the case maybe.
D. The person in exercising its power in relation to a company as its Chief Executive Officer
under the Companies Act.

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C9F/1.6
31. The MAS takes a/an ________ view in assessing an application for approval of the
arrangement under paragraph 11 of the First Schedule to the FAA when the arrangement
involves more than one foreign related corporation.

A. holistic
B. objective
C. subjective
D. facilitative

C10D/1.6
32. ____________ responsible for charting the corporate policy and strategy to deliver the fair
dealing outcomes to customers under FAA?

A. General Manager
B. Board of Directors
C. Chief Executive Officer
D. Director for Compliance

C6/6.28
33. Where there is no face-to-face contact, what CDD measures should the financial adviser (FA)
perform?

A. Simplified Customer Due Diligence

B. Enhanced Customer Due Diligence
C. Obtain approval from the FA’s senior management.
D. Measures at least as robust as those that would be required for face-to-face contact.

C4A/1.15
34. Which one of the following will fall under the requirements as set out in MAS Notice No: FAA-
N16, which involved making recommendations on investment products to the clients?

A. Know your client’s investment objectives and financial situation.

B. Understand your client’s concerns by conducting needs analysis.
C. Documentation and record keeping of the recommendations made.
D. All of the above.

C4A/E2/23
35. Where a client, after being informed of the outcome of the Customer Knowledge Assessment
(CKA) that he does not possess the requisite knowledge or experience in an unlisted specified
investment product, the financial adviser ______________

A. shall provide advice to the client nevertheless

B. shall provide advice to the client taking into account the client investment objectives,
financial situations and particular needs and the outcome of the CKA.
C. shall not proceed.
D. shall inform the client in writing that it is the financial adviser’s responsibility to ensure
suitability for the product selected, then proceed.

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C10C/1.11(b)
36. Which one of the following is the front-end procedure to facilitate the monitoring of switching
of designated investment products under the Financial Advisers Act?

A. Tracking the volume of switching transactions.

B. Identifying any unusual trends in switching transactions
C. Declaring in writing that the client has been advised of any free switching options.
D. Implementing procedures to ensure that each switching transaction is reviewed for
appropriateness.

C8A/1.1
37. Under Notice No: MAS 302, which one of the following is correct in respect of the development
and pricing of the Life Insurance Products and Investment-linked Policy sub-funds?

A. Approval from MAS is required for the launch of any short-term accident and health
policies.
B. Approval from MAS is required for the launch of any term policies having a duration of 5
years or less.
C. MAS needs to approve the policies and procedures in respect of the development and
pricing of life insurance products and Investment-linked policy sub-funds.
D. The Board of Directors need to approve the policies and procedures in respect of the
development and pricing of life insurance products and Investment-linked policy sub-
funds.

C5D/13
38. An appointed representative of a financial adviser is required to satisfy minimum entry
requirements. Which one of the following is Not correct in respect of the requirements?

A. Be at least 18 years old

B. Satisfy the criteria as stipulated by the MAS.
C. Examination criteria as set out in MAS Notice FAA-N13.
D. Fit and proper criteria as set out in MAS Guideline No: FSG-G01

C11C/3
39. The “ACMF Framework” refers to the ________________.

A. ASIAN Capital Market Professional Mobility Framework

B. ASEAN Capital Market Professional Mobility Framework
C. ASIAN Credit & Marketing Professional Mobility Framework
D. ASEAN Credit & Marketing Professional Mobility Framework

C8A/1.11
40. The Guidelines in the Notice No: MAS 302 on product development and pricing provide that
an insurer should notify the MAS in writing of any product launched that does not require the
approval of the MAS with ____________working days after the official launch date of the
product.

A. 3
B. 5
C. 7
D. 14

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C9E/1.22
41. XYZ, a financial adviser, entered into a contractual agreement with a life insurance company
to only distribute that insurer’s life policies. Which of the following statements is most true?

A. XYZ is an exempt financial adviser.

B. XYZ is an independent financial adviser.
C. The contractual agreement is a form of direct product restriction.
D. The contractual agreement is a form of indirect product restriction.

C10A/1.9
42. A client refuses to disclose information requested by his dealer, but he wants his dealer to
execute a trade for him. Which one of the following actions by the dealer is Not correct?

A. Proceed with the client’s request and record his decision.

B. Warn the client that he is responsible for product suitability.
C. Highlights to the client the trading risks without performing a needs analysis.
D. Decline the client’s request for execution because it contravenes the trading rules.

C11A/25
43. Under the MAS Guideline No: FAA-G13 (conflicts of interest arising from issuing promulgating
research analysis or research reports), a financial institution should maintain proper records
and supporting documents of its analysts’ research recommendations for a period of not less
than _________years from the date of publication of the research recommendation.

A. 3
B. 4
C. 5
D. 6

C6/6.31(a)
44. A financial adviser may establish business relations with a customer before completing the
verification of the identity of the customer as required, if _______________________.

A. the risk of money laundering and terrorism financing is high.

B. it is satisfied with the third party it intends to rely upon, to conduct ongoing monitoring of
business relations with customers.
C. the deferral of completion of the verification is essential in order not to interrupt the normal
conduct of business operations.
D. the customer is not a Politically Exposed Persons (PEPs).

C12/9D/5.9
45. What one of the following is not considered as good collateral that can be tendered to a
Collective Investment Scheme?

A. Bonds with AAA rating by Moody’s.

B. Bonds with embedded financial derivatives.
C. Bonds with AAA rating by Standard & Poor’s.
D. Bonds with a guarantee from a government agency.

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C6/8.1(8th para)
46. With respect to Customer Due Diligence, which one of the following is NOT classified as
Politically Exposed Person?

A. Cabinet Ministers
B. Senior Military Officer
C. Senior Executives of state-owned corporations
D. Government Entity

C14/5.7(a)(i)
47. Protection needs are for ensuring that the financial obligations can be met. Which one of the
following is considered protection needs?

A. Budgeting for a 5-room HDB flat.

B. Accumulating sufficient funds for retirement.
C. Meeting the financial obligations upon premature death.
D. Generating a minimum annual return of 7% on an investment portfolio.

C14/5.15
48. During the fact-find process, finding out the client’s employment details does Not help the
financial adviser representative to:

A. identify the client’s monthly financial obligations.

B. analyse whether the client needs a Medical Expense Insurance Policy.
C. determine whether the client should take up an income protection plan.
D. assess the client’s ability to commit to a medium to long-term investment product.

C8A/1.16
49. The MAS may take into account a failure to comply with the standards mentioned under the
Guidelines in the Notice No: MAS 302, whether to:

A. approve a new product

B. revoke the approval of a product
C. issue directions for the withdrawal of a product
D. any one of the above actions

C1/2.8
50. Which one of the following types of instruments issued by MAS primarily imposes legally
binding requirements on a specified class of financial institutions or persons?

A. Codes
B. Notices
C. Practice Notes
D. Policy Statements

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C4B/7/24(a)to(g)
51. When making a recommendation on a designated investment product, a licensed financial
adviser shall disclose to a prospective client which one of the following information?

A. Risks arising from the product.

B. Benefits deriving from the product.
C. The relationship existing between the financial adviser and the product provider.
D. All of the above

C2/4.10
52. Which one of the following is/are “investment product(s)” under the Financial Advisers Act?

A. Capital market products

B. Any other products as may prescribed by the MAS.
C. Life Insurance Policy
D. All of the above

C2/5.4
53. Which one of the following is correct concerning the renewal of all existing financial advisers’
licences?
All existing financial advisers’ licences:

A. will no longer have to be renewed

B. are required to be renewed annually
C. need not be required, and need not pay an annual licence fee
D. need to be renewed and need not pay an annual licence fee

C9A/8.1(a)(iv)
54. The minimum paid-up capital for a financial adviser to carry out financial advisory services for
arranging of contracts of insurance in respect of life policies, other than contracts of
reinsurance is _____________.

A. S$100,000
B. S$150,000
C. S$300,000
D. S$500,000

C3/6.3
55. Under the Regulation 20(3) of the Financial Advisers Regulations, it is stated that no financial
adviser shall withdraw monies from a bank account maintained by it, unless under certain
circumstances. Which one of the following statements regarding the circumstances for
withdrawal of monies is false?

A. The financial adviser shall withdraw the monies if it relates to any repayment of monies
that were paid intentionally into the account as insurance monies.
B. The financial adviser shall withdraw the monies for any investment by way of deposits
placed with any bank licensed under the Banking Act (Cap.19).
C. The financial adviser shall withdraw the monies if relates to any payment to or for an
insurer in respect of amounts due to the insurer under or in relation to a contract of
insurance.
D. The financial adviser shall withdraw the monies if relates to any payment to or for a
person entitled to receive payment of the moneys, including itself in so far as it is entitled
to receive payment for itself.

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C3/6.9
56. Interest or income received under the Insurance Broking Premium Accounts shall after the
credit period not be retained by the financial adviser (FA) and shall immediately be paid over
to the insurer. This credit period refers to the period within which the FA has agreed with the
insurer to pay payment of any amount due to the insurer under or in relation to a contract of
insurance; or _______days from the date of commencement of cover, whichever is earlier.

A. 30
B. 60
C. 90
D. 120

C4A/E2/24
57. Peter, your client is assessed as not possessing the knowledge or experience to invest in
unlisted Specified Investment Product (SIP), nevertheless chooses to transact in the SIP.
Which one of the following statements is false?
Financial adviser has to inform the client in writing:

A. the outcome of the Customer Knowledge Assessment

B. that it is his responsibility to ensure the suitability of the SIP
C. to confirm his intent to transact the SIP despite the outcome of the Customer Knowledge
Assessment
D. that he is disqualified from transacting in the SIP, unless he passes the Customer
Knowledge Assessment.

C4A/E5/37(b)
58. When recommending on a life policy, a financial adviser does not need to provide his client
with a copy of the:

A. Product Summary
B. Policy Illustration
C. Product Highlights Sheet
D. Profile Statement

C6/8.1
59. Which one of the following do Not require Enhanced Customer Due Diligence measures?

A. Immediate family of Politically Exposed Persons

B. Senior Management Director
C. Government Minister
D. Close associate of a head of state

C1/2.9
60. The FAA provides that the Monetary Authority Of Singapore has the power of authority to
issue written directions, such as ________________which will have legal effect.

A. notices
B. policy statements
C. codes
D. all of the above

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C1/2.11
61. Which instruments issued by MAS do not have the force of the law that financial institutions or
other specified persons such as financial adviser’s representatives have to adhere to?

A. Acts
B. Subsidiary Legislation
C. Directives
D. Codes

C2/5.8(a)
62. MAS may refuse an application for the grant of a financial adviser’s licence. What could be the
possible reason(s)?

A. The applicant is a corporation.

B. The applicant is a representative.
C. The applicant has in force a professional indemnity insurance policy.
D. None of the above

C2/6.2
63. The FAA provides for a category of persons to be exempted from holding a financial adviser’s
licence. Which one of the following falls under the category of “exempt persons”?

A. Exempt fund managers who serve up to 30 qualified investors.

B. Exempt fund managers who serve up to 30 accredited investors.
C. Exempt fund managers who serve up to 30 accredited investors on any one occasion.
D. All of the above

C4C/A1/6
64. No Financial adviser or its representatives shall, label a dual currency investment that maybe
misleading to its investors. Which one of the following statement(s) is/are considered
misleading?

A. a deposit
B. a structured deposit
C. principal guaranteed in terms of the base currency
D. all of the above

C5E/1.7
65. Mary is a representative of a financial adviser. What misconduct did Mary committed that
need not be reported to MAS?

A. Failure to meet continuing education requirements.

B. Failure to satisfy the “Guideline On Fit and Proper Criteria”
C. Failure to disclose all material information relating to any designated investment product
recommended by the FAR.
D. Failure to give consideration to a client’s investment objectives, financial situation or
particular needs relating to any designated investment product recommended by the
FAR.

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C2/13.2
66. Which one of the following is correct regarding being appointed as a provisional representative
of a financial adviser?

A. Be at least 18 years old.

B. Holds a least 3 GCE “O” level passes.
C. Passes all the relevant CMFAS examinations within 3 months.
D. Possess at least 2 years of working experience in the financial services industry.

C2/18.1
67. If an appointed representative’s status has been revoked by MAS, he may appeal this decision
within ______days to the Minister, whose decision shall be final.

A. 7
B. 15
C. 21
D. 30

C5E/1.9
68. Under the MAS Notice No: FAA – N14, a financial adviser is required to submit an annual
report to the MAS, even though there is no misconduct committed by its representative not
later than ______ days after 31 December of that calendar year.

A. 7
B. 14
C. 21
D. 30

C7B/7
69. A financial adviser discovered a hacking of its critical system with disrupted services to
customers. It should give notice of the disruption to the Monetary Authority of Singapore no
later than ________ from the discovery of the incident.

A. 1 hour
B. 3 hours
C. 5 hours
D. 7 hours

C13/3.3
70. The Basic Retirement Sum (BRS) for CPF members who reach age 55 from 2023 to 2027 will
increase by ______ for each successive cohort to account for long term-term inflation and
improvements in living standard.

A. 2%
B. 2.5%
C. 3%
D. 3.5%

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C13/3.11(a)(i)
71. Members who do not choose a plan under CPF Life, will be placed under which plan
by default?

A. CPF Life Basic Plan

B. CPF Life Escalating Plan
C. CPF Life Standard Plan
D. CPF Balanced Plan

C11E/ 1.1
72. Financial institutions today have various marketing and distribution arrangements such as
roadshows and tie-ups with retailers to market their products and services to customers.
Which one of the following has the responsibility to set the right tone in conducting such
marketing cum distribution arrangements and activities in public places in a responsible and
professional manner?

A. Sales and marketing

B. Distribution and tie-ups
C. Board and senior management
D. Internal control and compliance

C9A/1
73. The “Guidelines on Criteria for the Grant of a Financial Adviser’s Licence” are intended to:

A. providing guidance on the licensing admission criteria for persons applying for a financial
licence’s licence under the Act.
B. providing guidance to fit and proper criteria to all relevant persons applying for a license.
C. set out the disclosure obligations of the Financial Advisers
D. All of the above

C9A/7(ii)
74. To be the Chief Executive Officer of a licensed financial adviser, one of the following criteria
that need Not be fulfilled is:

A. having the relevant academic and professional qualifications

B. having a minimum of 7 years; relevant working experience
C. performing in a relevant managerial capacity for at least 3 years

D. meeting the fit and proper criteria as set out on MAS Guideline No:FSG-G01

C13/3.33
75. Which one of the following schemes best describe the following sentence?
“It will feature higher payouts that increase over time with no cap on payout duration, to
provide better protection against the uncertainty of long-term care costs if you become
severely disabled”.

A. ElderShield Life
B. CareShield Life
C. MediShield Life
D. Medifund

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CMFAS Module 5 Set B

C13/3.49
76. Upon the sale of a HDB property, purchased using CPF savings, the CPF member is required
to ________________.

A. refund the CPF Savings withdrawn to his OA, SA and Medisave account assuming he is
below 55 years of age
B. refund the CPF Savings withdrawn to his CPF account
C. refund the CPF Savings withdrawn plus accrued interest to his CPF account and this
does not include housing grant used.
D. refund the CPF Savings withdrawn plus accrued interest to his CPF account.

C1/2.15/(d)
77. On June 2010, MAS issued a monograph on Tenets Of Effective Regulation to communicate
MAS’ approach to developing effective regulation. Which Tenets flows solely from the principle
of “Risk Focused”?

A. Tenet 5 – Impact Sensitive

B. Tenet 2 – Shared Responsibility
C. Tenet 6 – Clear and Consistent
D. Tenet 4 – Responsive To Change and Cycles

C1/3.12
78. Which one of the following statements about Singapore Exchange Limited’s regulatory
functions is True?

A. It acts as a central bank of Singapore.

B. It regulates the volatility of stock prices.
C. It conducts on-site inspections of its members.
D. It monitors the financial health of all companies in Singapore.

C5F/1.3
79. The MAS Notice No: FAA-N15 on the cancellation period for unlisted debentures applies to
specified persons when they sell, whether directly or indirectly an unlisted debenture to a
client. This Notice shall apply to:

A. exempt financial advisers

B. holders of a financial adviser’s licence
C. persons who are exempted under Regulation 29 of the FAR
D. all of the above

C2/6.8(b)
80. Which one of the following is considered an accredited investor under the Financial Advisers
Regulations?

A. A corporation with net assets exceeding S$2 million in value.

B. A corporation with net assets exceeding S$5 million in value.
C. A corporation with net assets exceeding S$7 million in value.
D. A corporation with net assets exceeding S$10 million in value.

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C2/7/21(1)
81. The words “Life Insurance Broker” is not allowed to be used by which of the following,
indicating that the person carries on as a business, in the name, description or title under
which it carries on business in Singapore?

A. Exempt Financial Adviser

B. Licensed Financial Adviser
C. Excluded Financial Adviser
D. Persons approved by the MAS.

C5A/1.5(b)(ii)
82. Which one of the following actions by the introducer fall under the definitions of “introducing
activity” in MAS Notice No: FAA –N02?

A. He works full time for the introducee.

B. He performs a need analysis for the client.
C. He conducts the Customer Knowledge Assessment for a client.
D. He provides factual information on investment products to a client.

C6/8.3(a)
83. What should the financial adviser (FA) do, in addition to performing enhanced CDD where a
customer or any beneficial owner of the customer is determined by the FA to be a politically
exposed person, or a family member or close associate of a politically exposed person?

A. obtain approval from the FA's senior management.

B. proceed to established business relations with customer, and file an STR Report.
C. reduce the scrutiny of transactions, based on reasonable monetary threshold.
D. freeze without delay, the funds or assets of the customer.

C2/9.4
84. Which of the following statements is False with regard to the Representative Notification
Framework (RNF) launched by the MAS?

A. A notice of intent by the principal will have to be lodged with MAS.

B. A “fit and proper” certification is to be provided to MAS in respect of the representative.
C. Onus is on the principals to accept only fit and proper individuals to be their
representatives.
D. The RNF is only applicable to financial advisers which are exempted from having to
apply for a licence.

C2/10.8
85. The Financial Advisers Act provides for how many classes of financial advisers’
representatives?

A. 2
B. 3
C. 4
D. 5

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CMFAS Module 5 Set B

C3/10.1(b)
86. No licensed financial advisers shall grant any unsecured advance or unsecured loan to an
officer or an employee (including a director) or any of its representatives, which in the
aggregate and outstanding at any one time, exceeds____________.

A. S$3,000
B. S$5,000
C. S$7,000
D. S$10,000

C6/12.4
87. When a financial adviser forms a suspicion of money laundering or terrorism financing, and
reasonably believes that performing any measures required, will tip-off the customer, the
financial adviser should file ________Report.

A. Enhanced Customer Due Diligence

B. Police
C. Anti-Money Laundering
D. Suspicious Transaction

C3/14.1
88. Which one of the following is the objective of a prohibition order issued by the Monetary
Authority of Singapore under the FAA (Cap110)?

A. To safeguard the interests of exempt financial adviser firms.

B. To maximize competition among the representatives of licensed financial advisers.
C. To prevent foreign financial advisers from monopolizing the local financial markets.
D. To keep unfit persons from engaging in the financial advisory services regulated under
the FAA.

C4A/I/42-44
89. Which one of the following statements is FALSE regarding recommending a client to switch
from one designated investment product to another designated investment product under MAS
Notice No:FAA-N16?

A. Ensure that the client genuinely benefits from the switch.

B. Ensure that the client makes an informed decision on the switch.
C. Inform the client in writing to seek independent financial advice should he wish to make
that switch.
D. Inform the client in writing of any fees or charges that he would bear if he were to make
the switch.

C4B/5/19
90. Which one of the following need Not be disclosed in writing, regarding the remuneration that a
financial adviser will received from the product providers?

A. Soft commissions
B. Trailer commissions
C. Details of all fees payable to be charged to the client.
D. Details of all fess charged for non-financial advisory activities.

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C5D/29
91. Which organization administers Module 6A of the Capital Market and Financial Advisory
Services Examination?

A. Institute of Banking and Finance

B. Singapore College of Insurance
C. Monetary Authority of Singapore
D. Association of Financial Advisers (Singapore)

C8B/1
92. MAS Notice No:307 on Investment-Linked Policies is issued pursuant to the _________ Act.

A. Insurance
B. Financial Advisers
C. Monetary Authority
D. Securities & Futures

C8B/21
93. Where the audit is carried out on the internal control and processes of the ILP sub-funds, the
period under review of shall be for a period of Not less than _________months.

A. 6
B. 9
C. 12
D. 18

C9B/1.8
94. Under Guideline No: FSG-G01, in assessing an application for a financial adviser’s licence is
“fitness and propriety”. Which one of the following group of people is Not required to satisfy
the fit and proper criteria?

A. Applicant
B. Substantial Shareholders
C. Directors and Chief Executive Officer
D. None of the above

C10D/1.59
95. To deliver fair dealing outcomes, financial institutions should provide customers with clear and
relevant information to enable them to make informed decisions. Hence information should be
given at what stage(s) of the advisory and sales process?

A. before
B. during
C. after
D. all of the above stages

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CMFAS Module 5 Set B

C10D/1.75
96. Which one of the following statements concerning a financial institution’s handling of customer
complaints for the delivery of fair dealing outcomes to customers under the Guideline No:
FAA-G11 is correct?
Customer complaints are:

A. handled by head of compliance

B. dealt with by Board of Directors
C. potential indicators of areas for improvement
D. referred to the Monetary Authority of Singapore

C9B/1.11
97. The factors set out in the following are relevant to the assessment of honesty, integrity and
reputation of a relevant person to be employed by a financial adviser. Which one of the
factors is Not true?

A. refused a fidelity bond in Singapore

B. served with a divorce proceeding for infidelity in Singapore
C. issued with a prohibition order by the MAS
D. a subject of complaint relating to activities regulated by the MAS

C9G/1.5(c)
98. To qualify as a “high net worth individual” under the FAA, the annual income of an individual
must Not be less than:

A. S$150,000
B. S$200,000
C. S$250,000
D. S$300,000

C10B/1.14(a)
99. When any financial adviser or its representatives offer any recommendation on structured
deposit, the financial adviser is required to convey a warning message to the customer.
Which of the following is correct regarding a structured deposit?

A. It has a fixed rate of return.

B. It has an investment element.
C. It is like a traditional deposit.
D. It is a well-structured product.

C14/5.22
100. For parents, you could add another _______ years to the life expectancy to arrive at the
years needed to support them.

A. 4
B. 6
C. 8
D. 10

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CMFAS Module 5 Set B

Answers – Set B

1 A 26 A 51 D 76 D
2 B 27 D 52 D 77 D
3 A 28 A 53 A 78 C
4 D 29 D 54 B 79 D
5 C 30 D 55 A 80 D
6 B 31 A 56 C 81 C
7 C 32 B 57 D 82 D
8 B 33 D 58 D 83 A
9 C 34 D 59 B 84 D
10 A 35 B 60 A 85 A
11 C 36 C 61 D 86 A
12 A 37 D 62 B 87 D
13 B 38 A 63 D 88 D
14 A 39 B 64 D 89 C
15 B 40 C 65 A 90 D
16 D 41 C 66 C 91 A
17 D 42 D 67 D 92 A
18 B 43 C 68 B 93 C
19 C 44 C 69 A 94 D
20 A 45 B 70 D 95 D
21 A 46 D 71 C 96 C
22 D 47 C 72 C 97 B
23 D 48 A 73 A 98 D
24 C 49 D 74 B 99 B
25 C 50 B 75 B 100 C

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