Nism 3 a - Compliance - Last Day Revision Test 2

7/26/2019 Nism 3 a - Compliance - Last Day Revision Test 2

1/39


2/39

NISM SERIES III ASECURITIES INTERMEDIARIES

COMPLIANCE ( NON FUND ) CERTIFICATION V.IMP LAST DAY REVISION EXAM 2

About PASS4SURE.in

PASS4SURE is a professional online practice test bank for various NSE NCFM, NISM and BSE exams. The team behind

PASS4SURE has decades of experience in the financial and stock markets and have succeeded in preparing practice

question bank which will help not only to pass the exams easily but also get good knowledge of the subject.

Our online mock exams contain questions which are carefully analysed by the experts and have a high probability of being

asked in the exams. Thus all PASS4SURE questions are highly valued and contribute to an almost 100% success rate.

We do not believe in offering you thousands of questions but most important 400

500 practice questions and answers.

PASS4SURE understands that time and money is valuable for our students, so we regularly update all our exams. The old

questions are deleted and new important questions are added. Our LAST DAY REVISION test are on the spot. This is done

to ensure that the students learns what is most important and pass the exams. You do not have to try again and again

wasting time and money.

Our simple aim is to simplify the NCFM, NISM and BSE exams. ALL THE BEST.

IMPORTANTThe viewing rights for this downloaded Question Bank will automatically

expire after 60 days from the date of purchase.

TEST DETAILSThe SECURITIES INTERMEDIARIES COMPLIANCE ( NON FUND ) CERTIFICATION EXAM is a 100 mark

exam with 60% as passing marks. In all 100 questions will be asked with 0.25% negative marking for Wrong

Answers. The time duration is 2 hours.

All Rights Reserved. No Part of this documents may be reproduced, stored in a retrieval system, or transmitted, in any

form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission

from PASS4SURE.in. For any clarification regarding this document or if you feel there are errors in the question bank,

please write us at [email protected]


3/39



LAST DAY REVISION EXAM 2

Question 1 Department of Financial Services administers government policies relating

to ____________.

(a) Public sector banks

(b) Term-lending financial institutions

(c) Life insurance and general insurance

(d) All of the above

Question 2 As per SEBI (Issue of Capital and Disclosure Requirements - ICDR)

Regulations, a copy of the resolution passed by the board of directors of

the issuer for allotting specified securities to promoters towards amount

received against promoters contribution, before opening of the issuehas to be submitted to _______ .

(a) SEBI

(b) Stock Exchange

(c) Merchant Banker

(d) AMFI

Correct Answer 1 All of the above

Correct Answer 2 SEBI


4/39



Question 3 Can SEBI prohibit any company from issuing prospectus, any offer

document, or advertisement soliciting money from the public for the issue

of securities?

(a) Yes

(b) No

Question 4 As per the SEBI (Prohibition of Fraudulent and Unfair Trade Practices

relating to Securities Market) Regulations, dealing in a security which is

not intended to effect a transfer of beneficial ownership but to serve only

as a device to ________ in the price of such security for wrongful gain or

avoidance of loss.

(a) inflate

(b) depress

(c) cause fluctuations

(d) all of the above

Correct Answer 3 Yes

Answer

Explanation

The Section 11A of the SEBI Act states that without any prejudice to theprovisions of the Companies Act 1956, SEBI may for the protection ofinvestors prohibit any company from issuing prospectus, any offer document,or advertisement soliciting money from the public for the issue of securities.

Correct Answer 4 all of the above


5/39



Question 5 As per the SEBI (Custodian of Securities) Regulations, an applicant for

the Custodian of Securities should have a networth of minimum of

(a) Rs 50 lakhs

(b) Rs 5 crores

(c) Rs 25 crores

(d) Rs 50 crores

Question 6 As per the SEBI (Custodian of Securities) Regulations - every certificate

granted to the applicant as a Custodian of Securities shall be valid for a

period of ______ years from the date of registration or its renewal.

(a) 3

(b) 5

(c) 7

(d) 10

Correct Answer 5 Rs 50 crores

Correct Answer 6 3

AnswerExplanation

Every certificate grated to the applicant as a Custodian of Securities shall bevalid for a period of 3 years from the date of registration or its renewal.


6/39



Question 7 To effectively implement the KYC guidelines, SEBI notified the ________.

(a) SEBI (KYC Registration Agency) Regulations, 2011

(b) SEBI (Self Regulatory Organization) Regulations, 2004

(c) PMLA, 2002

(d) None of the above

Question 8 According to the SEBI (Stock Brokers and Sub Brokers) Regulations, the

compliance officer shall immediately and independently report to SEBI

any non-compliance observed by him. True or False ?

(a) TRUE

(b) FALSE

Correct Answer 7 SEBI (KYC Registration Agency) Regulations, 2011

Correct Answer 8 TRUE


7/39



Question 9 As per the SEBI (Prohibition of Fraudulent and Unfair Trade Prac-tices

relating to securities Market) Regulations, in case of fraud, SEBI can

________ the proceeds or securities in respect of any transaction which is

in violation of the SEBI regulations.

(a) Impound

(b) Retain(c) Both 1 and 2

(d) SEBI does not have any such authority.

Question 10 As per SEBI (Intermediaries) Regulations, 2008, what is the next step after

receiving the recommendations of the designated authority who is

appointed to enquire and recommend action in case of violation of rules of

the securities market ?

(a) Gives warning to the intermediary dismissing the recommendations(b) Issues the recommended action without hearing the noticee

(c) issues a show cause notice to the intermediary as to why the recommendedaction should not be taken

(d) none of the above

Correct Answer 9 Both 1 and 2

Correct Answer 10 issues a show cause notice to the intermediary as to why the recommendedaction should not be taken

Answer

Explanation

The designated authority shall, if there are reasonable grounds to do so, issue a

show-cause notice to the concerned person requiring it to show cause as to whythe certificate of registration granted to it, should not be suspended or cancelledor why any other action provided in the regulations should not be taken.


8/39



Question 11 As per SEBI (Prohibition of Fraudulent and Unfair Trade Practices

relating to securities Market) Regulations, SEBI can, both impound and

retain the proceeds or securities in respect of any transaction which is in

violation or prima facie in violation of these regulations - True or False ?

(a) FALSE

(b) TRUE

Question 12 Every member of a recognized stock exchange has to maintain and

preserve the Counterfoils or duplicates of contract notes issued to clients

for a period of _____ years

(a) 2

(b) 5

(c) 7

(d) 10


Correct Answer 12 2

Answer

Explanation

Every member of a recognized stock exchange to maintain and preserve the

following documents for a period of 2 years: Members contract books showing details of all contracts entered into by themember with other members of the same exchange or counterfoils or duplicates

of memos of confirmation issued to such other members. Counterfoils or duplicates of contract notes issued to clients. Written consent of clients in respect of contracts entered into as principals.


9/39



Question 13 A debenture trustee shall pay a sum of Rs. _______ as registration fees at

the time of the grant of certificate by SEBI.

(a) Rs 25 lakhs

(b) Rs 15 lakhs

(c) Rs 10 lakhs

(d) Rs 5 lakhs

Question 14 As per the SEBI code of conduct for underwriters, an Underwriter is

responsible for the acts or omissions only of its employees and not of

agents in respect to the conduct of its business. State True or False ?

(a) FALSE

(b) TRUE

Correct Answer 13 Rs 10 lakhs

Answer

Explanation

Every debenture trustee shall pay a sum of Rs. 10 lakhs as registration fees atthe time of the grant of certificate by SEBI and shall pay renewal fee of Rs. 5

lakh every three years from the fourth year from the date of initial registration.

Correct Answer 14 FALSE

Answer

Explanation

The Underwriter is responsible for the acts or omissions of its employees andagents in respect to the conduct of its business.


10/39



Question 15 The annual fees to keep the registration in force as custodian under the

SEBI (Custodian of Securities) Regulations is ____________.

(a) Rs. 10 lakh or 0.00025% of the assets under custody whichever is higher.

(b) Rs 25 lakh or 0.00025% of the assets under custody whichever is higher.

(c) Rs. 10 lakh or 0.00025% of the assets under custody whichever is lower.

(d) Rs 25 lakh or 0.00025% of the assets under custody whichever is lower.

Question 16 SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to

securities Market) Regulations have been made in exercise of the powers

conferred by __________.

(a) Prevention of Money Laundering Act

(b) Companies Act

(c) Securities Contract ( Regulation ) Act

(d) SEBI Act

Correct Answer 15 Rs. 10 lakh or 0.00025% of the assets under custody whichever is higher.

Answer

Explanation

On being granted the certificate of registration, the Custodian of securities needto pay registra-tion fee of Rs. 15 lakh to SEBI, and an annual fee of Rs. 10 lakhor 0.00025% of the assets under custody of the custodian of securities,whichever is higher.

Correct Answer 16 SEBI Act

Answer

Explanation

The Securities and Exchange Board of India (Prohibition of Fraudulent and

Unfair Trade Practices relating to Securities Market) Regulations, 2003prohibit fraudulent, unfair and manipulative trade practices in securities.These regulations have been made in exercise of the powers conferred bysection 30 of the SEBI Act, 1992.


11/39



Question 17 Fraud includes a willful misrepresentation of truth OR concealment of

material fact, in order that another person may act, to his detriment. State

whether True or False?

(a) FALSE

(b) TRUE

Question 18 _____________ appoints the Registrar of Companies.

(a) SEBI

(b) Central Government

(c) Company Law Board

(d) RBI


Correct Answer 18 Central Government

Answer

Explanation

Pursuant to Section 609(1) of the Companies Act, 1956, the CentralGovernment has appointed Registrars at different places to discharge thefunction of registration of companies.


12/39



Question 19 SEBI in the interest of the securities market may direct an intermediary to

refund the money or securities collected from the investors, however no

interest will be paid on it - State True or False ?

(a) TRUE

(b) FALSE

Question 20 ______________ must be maintained by a Stock Broker while conductinghis business.

(a) High level of profits

(b) High level of Integrity

(c) Prominence amongst his clients



Answer

Explanation

The refund can be with or without interest as per the decision of SEBI.

Correct Answer 20 High level of Integrity

Answer

Explanation

As per the Code of Conduct for Brokers - A stock-broker, must maintain highstandards of integrity, promptitude and fairness in the conduct of all itsbusiness.


13/39



Question 21 The certificate of registration granted as a Underwriter, and its renewal is

valid for a period of _____ from the date of its issue to the applicant.

(a) 2 years

(b) 3 years

(c) 5 years

(d) 7 years

Question 22 For SEBI to consider the application of registration as a credit rating

agency of an entity promoted by a company, the promoter shall have a

continuous networth of minimum __________ for the previous five year.

(a) Rs 1 crore

(b) Rs 10 crores

(c) Rs 50 crores

(d) Rs 100 crores

Correct Answer 21 3 years

Answer

Explanation

The certificate of registration so granted and its renewal is valid for a period of3 years from the date of its issue to the applicant.An underwriter shall apply for renewal of registration three months prior to theexpiry of the period of the certificate along with the appropriate fees as

provided by in the regulations.

Correct Answer 22 Rs 100 crores


14/39



Question 23 As per SEBI(Debenture Trustees) Regulations, debenture trustee shall

communicate to the debenture holders on _____basis regarding

compliance, defaults, etc. and the action taken regarding it.

(a) Half Yearly

(b) Yearly

(c) Monthly

(d) Every 3 months

Question 24 The Banker to an issue has to submit the collection figures to the Registrar

to the Issue, the lead manager and the body corporate and such figures

should be submitted within ______ working days from the issue closure

date.

(a) seven

(b) three

(c) six

(d) fifteen

Correct Answer 23 Half Yearly

Correct Answer 24 seven


15/39



Question 25 The capital adequacy requirement to become a Debenture Trustee is

__________ .

(a) Total Assets of Rs 1 crore

(b) Total Assets of Rs 5 crores

(c) Networth of Rs 5 crores

(d) Networth of Rs 1 crore

Question 26 As per the SEBI (Credit Rating Agencies) Regulations, a Credit Rating

Agency on being granted the registration certificate shall pay to SEBI the

registration fee of Rs. ______ lakhs

(a) 5

(b) 10

(c) 20

(d) 25

Correct Answer 25 Networth of Rs 1 crore

Answer

Explanation

As per SEBI (Debenture Trustees) Regulations, capital adequacy requirementshall not be less than the networth of one crore rupees, provided that adebenture trustee holding certificate of registration as on the date ofcommence-ment of the SEBI (Debenture trustees) (Amendment) Regulations,2003 shall fulfil the networth requirements within two years from the date ofsuch commencement.

Correct Answer 26 20

Answer

Explanation

The Credit Rating Agency on being granted the registration certificate shall pay

to SEBI the registra-tion fee of Rs. 20 lakh. Application for renewal can bemade to SEBI three months prior to the expiry of the certificate accompaniedwith the renewal fees. The renewal fee is Rs. 10 lakh.


16/39



Question 27 SEBI in the interest of the securities market may direct an intermediary to

refund the money or securities collected from the investors with or without

interest. State whether True or False?

(a) TRUE

(b) FALSE

Question 28 Is it required to verify the source of funds as well as wealth of PoliticallyExposed Persons ?

(a) Yes

(b) No




17/39



Question 29 If a Credit Rating Agency has to change the rating defination, it can be

done ____________.

(a) only with the prior permission of SEBI

(b) only with the approvals of its shareholders

(c) only at certain periodic intervals


Question 30 A SEBI registered stock broker can become a depository participant

provided the stock broker has a minimum net worth of Rs._____ lakhs

(a) 10

(b) 25

(c) 50

(d) 100

Correct Answer 29 only with the prior permission of SEBI

Answer

Explanation

Rating definition, as well as the structure for a particular rating product, shallnot be changed by a credit rating agency, without prior information to SEBI.



18/39



Question 31 Can SEBI prohibit any company from issuing prospectus, any offer

document, or advertisement soliciting money from the public for the issue

of securities? State Yes or No?

(a) Yes

(b) No

Question 32 Which of the following is not a security as per Securities ContractRegulation Act (SCRA) ?

(a) Derivatives

(b) Bonds

(c) Bullion

(d) Shares


Answer

Explanation

The Section 11A of the SEBI Act states that without any prejudice to theprovisions of the Companies Act 1956, SEBI may for the protection ofinvestors prohibit any company from issuing prospectus, any offer document,

or advertisement soliciting money from the public for the issue of securities.

Correct Answer 32 Bullion


19/39



Question 33 Apart from SEBI Regulations, Bankers to an issue shall abide by the

relevant rules and regulations of _______ .

(a) Indian Bank Association

(b) Central Government

(c) RBI


Question 34 Post issue activities, generally co-ordinated by Lead Merchant Banker,

include which of the following?

(a) Finalisation of the basis of allotment

(b) Deciding on centres for holding conferences of stock brokers, investors, etc.

(c) Processing rematerialisation requests



Correct Answer 34 Finalisation of the basis of allotment


20/39



Question 35 As per SEBI (ICDR) Regulation, only audited and consolidated financial

statements need to be prepared in accordance to GAAP. State whether

True or False.

(a) TRUE

(b) FALSE

Question 36 SEBI was set up under which act ?(a) Competition Act 2002

(b) SEBI Act 1992

(c) Securities Contract (Regulation) Act 1956

(d) Securities Contract (Regulation) Rules 1957


Answer

Explanation

In accordance with requirements of the ICDR, the information requiredincludes audited consolidated or unconsolidated financial statements preparedin accordance with Indian GAAP standards.

Correct Answer 36 SEBI Act 1992

Answer

Explanation

The SEBI Act of 1992 was enacted upon to provide for the establishment of a

Board to protect the interests of investors in securities and to promote thedevelopment of, and to regulate, the securities market and for mattersconnected therewith or incidental thereto.


21/39



Question 37 To bring in uniformity in the KYC procedure across intermediaries, the In

Person Verification (IPV) has to be done by which of the foll

intermediaries -

(a) Stock Brokers

(b) KRAs & Depository Participants

(c) Venture Capital Funds and Collective Investment Schemes


Question 38 Can a common order be passed in respect of a number of noticees where

the subject matter in question is substantially the same or similar in

nature?

(a) Yes

(b) No


Answer

Explanation

To bring in uniformity in the KYC procedure across intermediaries, the IPVrequirements for all the intermediaries have been streamlined by SEBI.Intermediaries registered with SEBI as Stock Brokers, KRAs, DepositoryParticipants, Mutual Funds, Portfolio Managers, Venture Capital Funds and

Collective Investment Schemes need to mandatorily carry out IPV for all theirclients.


AnswerExplanation As per the SEBI (Intermediaries) Regulations - Action in case of default - TheDesignated member may pass a common order in respect of a number of

notices where the subject matter in question is substantially the same or similarin nature.


22/39



Question 39 A Merchant Banker has to disclose its track record for a period of _______

from the date of listing for each public issue managed by the merchant

banker.

(a) 5 Financial Years

(b) 4 Calendar years

(c) 3 Financial Years

(d) 4 Financial Years

Question 40 A member of a recognised stock exchange can enter into a contract as a

principal with another member who is also a member of a recognised

stock exchange after obtaining his consent - True or False ?

(a) TRUE

(b) FALSE

Correct Answer 39 3 Financial Years

AnswerExplanation As per SEBI, the merchant bankers shall disclose the track record of theperformance of the public issues managed by them.The track record shall be disclosed for a period of three financial years fromthe date of listing for each public issue managed by the merchant banker. Thisinformation should be made available on the website and a reference to the

same should be made in the offer document.


Answer

Explanation

Section 15 of SCRA provides that no member of a recognised stock exchangeshall in respect of any securities enter into any contract as a principal with any

person other than a member of a recognised stock exchange, unless he hassecured the consent or authority of such person and discloses in the note,memorandum or agreement of sale or purchase that he is acting as a principal.


23/39



Question 41 The certificate of registration as Underwriter is valid for a period of how

many years ?

(a) 2

(b) 3

(c) 5

(d) 10

Question 42 As per Securities Contracts (Regulation) Rules - SCRR, the trading

members of the stock exchanges are required to maintain the counterfoils

or duplicates of contract notes issued to clients for how many years?

(a) 1

(b) 2

(c) 3

(d) 5

Correct Answer 41 3

Correct Answer 42 2

Answer

Explanation

Rule 15(2) od SCRR requires every member of a recognized stock exchange to

maintain and preserve the following documents for a period of 2 years: Members contractbooks showing details of all contracts entered into by themember with other members of the same exchange or counterfoils or duplicatesof memos of confirmation issued to such other members. Counterfoils or duplicates of contract notes issued to clients. Written consent of clients in respect of contracts entered into as principals.


24/39



Question 43 As per the SEBI (Underwriters) Regulations - code of conduct, theunderwriters shall not be a party to or instrumental for ____________.

(a) creation of false market

(b) price rigging or manipulation

(c) passing of unpublished price sensitive information in respect of securities

which are listed and proposed to be listed in any stock exchange to any personor intermediary.


Question 44 Any person aggrieved by an order of the SEBI may prefer an appeal to the

Securities Appellate Tribunal within a period of 60 days from the date on

which a copy of the order made by SEBI has been received by such person.

True or False ?

(a) TRUE

(b) FALSE



Answer

Explanation

An appeal shall be filed within a period of 45 days and not 60 days.

(Any person aggrieved by any decision of the Securities Appellate Tribunalmay file an appeal to the Supreme Court within 60 days).


25/39



Question 45 __________of SEBI act relates to defaults by mutual funds(MFs) andprescribes penalties.

(a) Section 15A

(b) Section 15B

(c) Section 15C

(d) Section 15D

Question 46 In case of buy-back, the company shall ensure that all the securities

bought back are extinguished within ____ days of the last date ofcompletion of buy-back.

(a) 4

(b) 6

(c) 7

(d) 15

Correct Answer 45 Section 15D

Correct Answer 46 7


26/39



Question 47 As per SEBI (Substantial Acquisition of Shares & Takeovers - SAST)Regulations, within how many days a merchant banker has to make an

open offer before making the public announcement of entering into an

agreement for acquisition of shares or voting rights ?

(a) 4 working days

(b) 7 working days

(c) 15 working days

(d) 30 working days

Question 48 Which of the following come under the scope of compliance ?

(a) Checklists

(b) Compliance's and redressing investor grievances

(c) Minutes of Board Meeting


Correct Answer 47 4 working days

Answer

Explanation

The acquirer company is required to appoint a SEBI registered MerchantBanker, as a manager to the open offer before making the publicannouncement.The public announcement shall be made by the merchant banker not later than4 working days of entering into an agreement for acquisition of shares or

voting rights or deciding to acquire shares or voting rights.

Correct Answer 48 Compliance's and redressing investor grievances


27/39



Question 49 State True or False - The SEBI Act vests SEBI with the power to issue the

certificate of registration to Securities MArket Intermediaries.

(a) TRUE

(b) FALSE

Question 50 Any person aggrieved by any decision or order of the Securities Appellate

Tribunal may file an appeal to the Supreme Court within ______ days

from the date of communication of the decision or order of the SAT to

him.

(a) 30

(b) 60

(c) 75

(d) 90


Answer

Explanation

Section 12 of SEBI Act vests SEBI with the power to issue the certificate ofregistration without which no stockbroker, sub-broker, share transfer agent,

banker to an issue, trustee of trust deed, registrar to an issue, merchant banker,underwriter, portfolio manager, investment adviser or such other intermediarywho may be associated with the securities market shall buy, sell or deal insecurities.



28/39



Question 51 The guaranteeing of trades done on an registered securities market is doneby ____________.

(a) Nationalised Banks

(b) Clearing House

(c) Merchant Bankers

(d) The Stock Broker who executes the trade

Question 52 An intermediary cannot sponsor or cause to be sponsored or carry on or

caused to be carried on any venture capital funds or collective investmentschemes including mutual funds if the same does not obtain a certificate of

registration from the SEBI - True or False ?

(a) TRUE

(b) FALSE

Correct Answer 51 Clearing House

Answer

Explanation

Clearing House is the intermediary which performs two important functions:

a) aggregating transactions over a trading period, netting the positions to

determine the liabilities of members and ensures movement of funds andsecurities to meet respective liabilities; andb) guarantee those trades, in the event of default by either buyer or seller.


Answer

Explanation

As per the rules of registration of Intermediaries, SEBI can suspend or cancel acertificate of registration after giving the person concerned a reasonableopportunity of presenting his case if he sponsors any venture capital funds orcollective investment schemes including mutual funds if the same does notobtain a certificate of registration from the SEBI.


29/39



Question 53 All the employees, directors etc of the intermediary need to strictly adhere

to the Code of Conduct as prescribed in the SEBI Regulations. State

Whether True or False?

(a) TRUE

(b) FALSE

Question 54 ___________ carries out the inspection and investigation of the books andaccounts maintained by the members of the Stock Exchange.

(a) the respective Stock Exchange

(b) Economic Offence Wing

(c) Ministry of Finance



Correct Answer 54 None of the above

Answer

Explanation

Regulation 19 of the SEBI (Stock Brokers and Sub-Brokers) Regulations givesthe SEBI Board the right to inspect.

SEBI may appoint inspecting authority to undertake inspection of the books ofaccount, other records and documents of the stock brokers, with or withoutnotice.


30/39



Question 55 As per the Code of Conduct for the Debenture Trustees, a Debenture

Trustee is responsible for the acts or omissions of its __________ in respect

to the conduct of its business.

(a) Employees

(b) Agents

(c) Both 1 and 2


Question 56 Whenever there is a violation of any regulations, the designated authority

issues a show cause notice. The show-cause notice shall specify the period

,not exceeding _________, within which reply should be submitted in

written representation along with documentary evidence, if any, in

support of the representation to the designated authority.

(a) 7 days

(b) 15 days

(c) 21 days

(d) 30 days


Correct Answer 56 21 days


31/39



Question 57 The Department of Disinvestment is concerned with which of the following

options?

(a) Pension Regulation and Reforms

(b) Direct Taxes

(c) Disinvestment of Public Sector units


Question 58 _______ is the central nodal agency responsible for receiving, processing,

analyzing and disseminating information regarding suspicious financial

transactions in order to support anti-money laundering efforts.

(a) Financial Intelligence Unit - India (FIU-I)

(b) Economic Offence Wing (EOW)

(c) SEBI

(d) RBI

Correct Answer 57 Disinvestment of Public Sector units

Answer

Explanation

Department of Disinvestment oversees, among other things, all matters relatingto the disinvestment of Central Government equity from Central Public Sectorundertakings.The department is also concerned with the financial policy relating to theutilization of proceeds of disinvestment.

Correct Answer 58 Financial Intelligence Unit - India (FIU-I)

Answer

Explanation

FIU-I is an independent body reporting directly to the Economic IntelligenceCouncil headed by the Finance Minister and is the central nodal agencyresponsible for receiving, processing, analyzing and disseminating informationregarding suspicious financial transactions in order to support anti-moneylaundering efforts


32/39



Question 59 Which of the following is/are considered critical reporting for a

Compliance Officer ?

(a) Money Laundering Activities

(b) Submission of books of accounts

(c) Submission of sauda books


Question 60 The objective of the SEBI (Prohibition of Insider Trading) Regulation is to

prohibit insider from ___________ on matters relating to insider trading?

(a) Dealing

(b) Counselling

(c) Communicating


Correct Answer 59 Money Laundering Activities



33/39



Question 61 Self Regulatory Organisations need to conform to the conditions as laid

down under SEBI (Intermediaries) Regulations, 2008 - State True or False

?

(a) FALSE

(b) TRUE

Question 62 A KYC Registering Agency (KRA) need not have a electronic connectivity

in order to establish interoperability with KRA's - State True or False ?

(a) TRUE

(b) FALSE


Answer

Explanation

For recognition as an SRO, certain conditions have to be met as prescribedunder the SEBI (Self Regulatory Organizations) Regulations, 2004.


AnswerExplanation

KRA has to have a electronic connectivity in order to establish interoperabilitywith other KRA's.


34/39



Question 63 Which of these organisations are not covered under PLMA ?

(a) Mutual Funds

(b) Manufacturing Firms taking Fixed Deposits for business expansion

(c) Stock Brokers

(d) Sub Brokers

Question 64 As per SEBI (Depositories and Participants) Regulations code of conduct,a Depository Participant shall not make untrue statements or suppress any

material fact in any __________ furnished to SEBI.

(a) Information

(b) Reports

(c) Documents


Correct Answer 63 Manufacturing Firms taking Fixed Deposits for business expansion

Answer

Explanation

The PMLA ie. Prevention of Money Laundering Act covers all FinancialIntermediaries, and this includes Mutual Funds, Stock and Sub Brokers.


Answer

Explanation

A Participant shall not make any untrue statement or suppress any material factin any documents, reports, papers or information furnished to SEBI.


35/39



Question 65 The functions of SEBI as per the SEBI Act includes __________.

(a) Promoting and regulating self-regulatory organisations

(b) Regulating substantial acquisition of shares and take-over of companies

(c) Regulating the business in stock exchanges and any other securities markets


Question 66 Dealing in securities shall be deemed to be a fraudulent or an unfair trade

practice if it involves fraud and may include an intermediary promising a

certain price in respect of buying or selling of a security to a client and

___________.

(a) waiting till a discrepancy arises in the price of such security and retaining the

difference in prices as profit for himself.(b) promising an opposite transaction at a different price to another client

(c) promising an opposite transaction at a different price at a later date to sameclient

(d) all of the above


Correct Answer 66 waiting till a discrepancy arises in the price of such security and retaining thedifference in prices as profit for himself.


36/39



Question 67 As per Section 19A of the Depositories Act, the penalty for delay in

dematerialization or issue of certificate of securities is Rs. _____ per day or

Rs 1 crore which ever is less.

(a) 25000

(b) 50000

(c) 1 lakh

(d) 3 lakhs

Question 68 Which following is/are deemed to be price sensitive information ?

(a) Issue of securities or buy back of securities

(b) Amalgamation, mergers or takeovers

(c) Periodic financial results of the company


Correct Answer 67 1 lakh

Answer

Explanation

Penalties for delay in dematerialization or issue of certificate of securities is Rs.

1 crore or Rs.1 lakh for each day of default, whichever is less.


Answer

Explanation

Price sensitive information is any information which if published, is likely tomaterially affect the price of securities of that company.

The following are deemed to be price sensitive information:- Periodic financial results of the company.- Intended declaration of dividends (both interim and final).-Issue of securities or buy back of securities.-Any major expansion plans or execution of new projects.

-Amalgamation, mergers or takeovers.- Disposal of the whole or substantial part of the undertaking.

-Any significant changes in policies, plans or operations of the company.


37/39



Question 69 Interest rate futures can have the underlying as ___________.(a) Government Securities

(b) T Bills

(c) Both 1 and 2


Question 70 As an integral part of Client Due Diligence, an intermediary has to verify

the customer identity using reliable, independent source documents, data

or in-formation - True or False ?

(a) TRUE

(b) FALSE


Answer

Explanation

Interest-rate Futures are contracts in which the underlying asset is a debtsecurity, like futures on Treasury Bills (T-Bills), Commercial Paper (CP) orGovernment Securities.



38/39



Practice Question Banks also available for :

NISM

NISM Series I: Currency Derivatives Certification Exam

NISM Series V A: Mutual Fund Distributors Certification ExamNISM Series VI: NISM Series VI - Depository Operations Certification Exam

NISM Series VII: Securities Operations and Risk Management

NISM Series VII: Equity Derivatives Certification Exam

NISM Series III A: Securities Intermediaries Compliance certification Exam

NISM Series X A : Investment Adviser (Level 1) Certification Exam

NISM Series X B: Investment Adviser (Level 2) Certification Exam

NCFM

NCFM Financial Markets: A Beginners Module

NCFM Capital Market (Dealers) Module

NCFM Derivative Market (Dealers) Module

BSE

Certificate on Security Market (BCSM)


39/39



Nism 3 a - Compliance - Last Day Revision Test 2

Documents

Transcript of Nism 3 a - Compliance - Last Day Revision Test 2