Series 63: Exercise

Exercise

Choose proper or improper

1. 1. _ Client funds and broker-dealer funds are held in the same account.
2. 2. _ Client funds are audited by an independent accountant on a scheduled date at least once a year.
3. 3. _ Clients receive account statements every three months.
4. 4. _ A broker-dealer receives written consent and then hypothecates a client’s securities

Answers

1. 1. Improper. Commingling of funds is a violation of custody rules.
2. 2. Improper. Although an annual audit by a third party is required, it must be unannounced.
3. 3. Proper. Quarterly account statements must be provided to