Morton Moore RE5 Mock Exam: Paper One

1. Which piece of legislation is the main focus of the RE5 Regulatory Examination?

FAIS Act

The Financial Advisory and Intermediary Services ActThe Companies ActThe National Credit ActThe Labour Relations Act

2. Who is responsible for the licensing and supervision of Financial Services Providers in South Africa?

Regulators

The South African Revenue ServiceThe Financial Sector Conduct AuthorityThe Ombud for Financial Services ProvidersThe Prudential Authority

3. What does the abbreviation DOFA stand for?

Fit and Proper

Date of Financial AssessmentDeclaration of Financial AuthorityDate of First AppointmentDuty of Fair Advice

4. A Representative who has not yet met the competence requirements must work under which arrangement?

Supervision

A probation contractSupervision by a suitably qualified personA limited licence issued in their own nameA written exemption from the Ombud

5. Within how many days must a Provider record a change to the Representative Register?

Representative Register

Fifteen daysThirty daysSixty daysNinety days

6. Which of the following is a Fit and Proper requirement for a Representative?

Fit and Proper

Ownership of a share in the ProviderHonesty, integrity and good standingA minimum of ten years of industry serviceMembership of a trade union

7. A client complains about advice given by a Representative. Who may investigate the complaint if the Provider does not resolve it?

Complaints

The Prudential AuthorityThe Ombud for Financial Services ProvidersThe Information RegulatorThe Competition Commission

8. What must a Provider give a client before or at the time of rendering a financial service?

General Code of Conduct

A tax certificateA disclosure of the Provider details and the nature of the serviceA copy of the licence applicationA signed indemnity form

9. A record of advice must be kept for at least how long after the termination of a product?

Record keeping

One yearThree yearsFive yearsTen years

10. Which statement about conflicts of interest is correct?

Conflict of interest

They may never be disclosed to a clientThey must be avoided and, where they cannot be avoided, disclosed to the clientThey only apply to Key IndividualsThey are managed by the product supplier alone

11. What is the purpose of a record of advice?

Advice

To prove that commission was paidTo show the basis on which the advice was given and the products consideredTo register the client with the regulatorTo replace the client agreement

12. Which of the following best describes a Key Individual?

Key Individuals

Any employee who deals with clientsA person who manages or oversees the financial services activities of a ProviderThe largest shareholder of a ProviderThe compliance auditor appointed each year

13. When may a Representative give advice on a product category that is not on the Provider licence?

Licensing

When the client insists in writingNever, because the licence limits the categories that may be advised onWhen a colleague holds that categoryWhen the premium is below a set limit

14. What must a Representative do if a client refuses to give the information needed for suitable advice?

General Code of Conduct

Refuse to deal with the client entirelyRecord the refusal and warn the client that the advice may not be appropriateEstimate the information and proceedAsk the product supplier to supply the information

15. Which body hears appeals against decisions taken by the Financial Sector Conduct Authority?

Regulators

The Financial Services TribunalThe High Court onlyThe Ombud CouncilThe National Treasury

16. How soon must a Provider acknowledge receipt of a written client complaint?

Complaints

Promptly, in line with the complaints management frameworkOnly once the investigation is completeWithin six monthsThere is no requirement to acknowledge

17. Which of the following would most likely disqualify a person from acting as a Representative?

Fit and Proper

A conviction for fraud involving dishonestyA recent change of employerStudying towards a further qualificationWorking under supervision

18. What does Continuous Professional Development require of a Representative?

CPD

Completing approved activities and recording the hours each cycleRewriting the RE5 examination every yearAttending a single annual product launchNothing, once the qualification is achieved

19. Which document sets out the standards a Provider must follow when dealing with clients?

General Code of Conduct

The General Code of ConductThe memorandum of incorporationThe client service level agreementThe product brochure

20. A Provider must at all times have adequate resources, systems and procedures. Which Fit and Proper requirement does this describe?

Fit and Proper

Financial soundnessOperational abilityCompetenceGood standing

Morton Moore RE5 Mock Exam: Paper One

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