FSA EXAM QUESTIONS AND CORRECT ANSWERS WITH EXPLANATIONS
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Course
FSA
Institution
FSA
FSA EXAM QUESTIONS AND CORRECT ANSWERS WITH EXPLANATIONS
Which of the following statements is TRUE regarding an omitting prospectus for an investment company?
Investment advisers may not omit a prospectus under any circumstances
Performance data may not be included
An application to invest may...
FSA EXAM QUESTIONS AND CORRECT
ANSWERS WITH EXPLANATIONS
Which of the following statements is TRUE regarding an omitting prospectus for an
investment company?
Investment advisers may not omit a prospectus under any circumstances
Performance data may not be included
An application to invest may be included
An investor must be informed that she should read the full prospectus - Answer-D
Certain investment company advertising may be published even if it meets the definition
of a prospectus. An omitting prospectus is an exempt investment company
advertisement that only includes information available in the full prospectus (such as
performance). An application to invest may not be included. The customer must be
informed as to how she may obtain the actual prospectus, and that the prospectus
should be read prior to investing any money. An application to receive a prospectus
may be included
Under the Securities Act of 1933, with whom are nonexempt issuers required to file
registration statements?
FINRA
Only the state in which the issuer is headquartered
Only the state in which the securities will be sold
SEC - Answer-D
If issuers do not qualify for an exemption from the Securities Act of 1933, they are
required to register with the SEC. Broker-dealers and their registered representatives
file their registration statements with FINRA, while the Administrator handles all filings
required under the Uniform Securities Act
Under the Securities Act of 1933, which of the following would MOST LIKELY be
included in the definition of an underwriter?
An agent
A broker-dealer
An investment adviser representative
An issuer - Answer-B
A broker-dealer is considered an underwriter when it helps issuers raise capital through
the sale of their new issues. Agents (of broker-dealers) and investment adviser
representatives (of investment advisers) are the individual employees of their respective
firms and are, therefore, not considered broker-dealers
, In order to clarify items in the balance sheet or income statement, a corporation may
include them as:
An addendum
Footnotes
A supplement
A correcting amendment - Answer-B
Footnotes on a financial statement are used to provide additional information or to
clarify information, i.e., methods of depreciation used, inventory valuation methods,
reserves for future events, etc.
According to Sarbanes-Oxley, a public corporation's financial statements must be
certified by the corporation's:
Chief auditor
Chief executive officer
Legal counsel
Chief financial officer
Compliance officer
I only
I and II only
II and IV only
II, III, and V only - Answer-C
Sarbanes-Oxley is a federal law that, among other things, requires a corporation's
annual and quarterly financial reports to be certified by the CEO and CFO of the
corporation
Which of the following would NOT be defined as an affiliated person under the
Investment Company Act of 1940?
An insider who owns more than 10% of an investment company's shares
An officer or director of an investment company
The outside legal counsel for an investment company
An employee of an investment company - Answer-C
According to the Investment Company Act of 1940, an affiliated person is considered
any officer, director, partner, copartner, or employee of the investment company. The
term also includes any person who directly or indirectly owns, controls, or holds, with
power to vote, 5% or more of the outstanding securities.
Which of the following forms would a publicly traded corporation typically file with the
SEC during its lifetime?
SEC Form 1092
Form 10-K
Form 8-K
Form 10-Q
I and III only
I, II, and III only
II, III, and IV only
I, II, III, and IV - Answer-C
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