Chapter 3 Practice Questions
- 1. All of the following activities require an Office of Supervisory Jurisdiction except:
- A. Accepting new customer accounts
- B. Taking customer orders
- C. Maintaining custody of customer securities
- D. Executing customer orders
- 2. A registered principal is conducting his firm’s annual internal inspection at its OSJs. Which of the following is not a specific responsibility with respect to this written report?
- A. To review customer account records for irregularities and abuses
- B. To test policies and procedures for safeguarding funds and securities
- C. To evaluate supervision of customer accounts serviced by branch office managers
- D. To ensure compliance with the telemarketing policy
- 3. All of the following specific duties can only be carried out by a principal at an OSJ except?
- A. Give a written approval for an institutional order
- B. Give final approval of new accounts
- C. Supervise persons at a branch office
- D. Give written approval for a representative’s correspondence that includes a solicitation to buy securities
- 4. After an OSJ receives a complete and correct application package for a deferred variable annuity, when does the principal have to review the application and if approved send it to the insurance company?
- A. Promptly
- B. Within 1 business day
- C. Within 7 business days
- D. Within 30 business days
- 5. An OSJ must be inspected at least once every ___, while a branch office that doesn’t supervise any non-branch offices must be inspected at least once every ___.
- A. Year; three years
- B. Three years; year
- C. Year; two years
- D. Calendar quarter; year
- 6. For a firm with more than 20 reps, what is the threshold at which the firm will be subject to the taping rule?
- A. 10% of the reps are disciplined reps
- B. 20% o