Investment Management Quiz

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Questions and Answers

What is the minimum paid-up capital required for firms dealing in investment?

AED 30 million

AED 50 million (correct)

AED 10 million

AED 100 million

Which of the following roles is NOT listed as a main function for the second category of dealing in investment?

Investment Administrator (correct)

Category Manager or Official

Compliance Officer

Risk Management Officer

Which type of organization can engage in the investment management activity of an investment fund?

Any partnership or non-profit organization

Only joint-stock companies established within the State (correct)

Branches of foreign companies only

Any legal person incorporated within the State

What is a requirement for firms categorized under dealing in investment?

They must be legal persons incorporated within the State (A) Signup and view all the answers

Which of the following approved jobs is associated with a trading broker?

Trading Manager (A) Signup and view all the answers

What is one of the primary responsibilities of the board in relation to market complaints?

Initiate investigations and impose penalties (C) Signup and view all the answers

Who is typically charged with presiding over board meetings and directing discussions?

The chairman of the board (D) Signup and view all the answers

Under what circumstances can the board temporarily suspend trading in securities?

Upon occurrence of exceptional circumstances (A) Signup and view all the answers

What must the board approve regarding the SCA?

Annual budget (D) Signup and view all the answers

Which of the following actions is NOT a responsibility of the board?

Conduct daily trading operations (D) Signup and view all the answers

How often is the board required to convene?

At least once every two months (B) Signup and view all the answers

Who can be appointed as auditors for the SCA?

Statutory auditors listed as practicing auditors (C) Signup and view all the answers

Which role does the deputy chairman automatically assume?

Chairman when the post becomes vacant (D) Signup and view all the answers

What is the primary focus of maintaining client standards?

Upholding personal and professional integrity (A) Signup and view all the answers

How should conflicts of interest be managed?

By actively managing and reporting them (A) Signup and view all the answers

What is the significance of treating market partners with respect?

It maintains market integrity and mutual trust (C) Signup and view all the answers

Continuous Professional Development (CPD) aims to achieve what?

Continual professional excellence and development of others (C) Signup and view all the answers

What should you do if asked to act on a matter outside your competence?

Decline unless you have access to proper advice or assistance (C) Signup and view all the answers

What is an essential aspect of respecting others and the environment?

Supporting diversity and considering environmental impact (D) Signup and view all the answers

Why is it important to comply with legislation and regulations?

To ensure ethical behavior and legal compliance (D) Signup and view all the answers

What role does awareness of capabilities play in professional conduct?

It entails refusing work that is beyond one's skills without proper support (C) Signup and view all the answers

What is required for a market to be established?

Resolution by the competent local authority (A) Signup and view all the answers

Who cannot be a member of the board of directors of the market?

Members of a public joint-stock company or a broker (C) Signup and view all the answers

Which condition must a market satisfy before being granted a license?

It occupies an appropriate building with necessary technology (C) Signup and view all the answers

What must be linked electronically for a market to operate effectively?

With the other markets in the State (D) Signup and view all the answers

What is legal evidence of trading and ownership in the market?

Records and documents issued by the market (D) Signup and view all the answers

What happens to a transaction in securities not entered according to the regulations?

It is null and void (D) Signup and view all the answers

What is the role of the SCA in relation to the markets?

To conduct inspections and investigations as needed (A) Signup and view all the answers

What can parties in a market do if there is a dispute in trading?

Enter into arbitration under SCA regulations (D) Signup and view all the answers

What is a requirement for transactions considered as transactions with related parties?

They must not grant any board member preferential conditions. (D) Signup and view all the answers

What must the company maintain concerning related parties?

A register of related parties and their transactions. (B) Signup and view all the answers

What is the role of the chairman when engaging in transactions with related parties?

The chairman must provide a notice to the SCA with transaction details. (D) Signup and view all the answers

What information must a related party disclose before a transaction?

The nature of the transaction and the related party’s interest. (C) Signup and view all the answers

What is the consequence for board members in transactions with related parties that are unfair?

They can be held liable for damages to the company. (C) Signup and view all the answers

What documents must a company provide regarding transactions with related parties?

Details about the transactions and the nature of those relationships. (B) Signup and view all the answers

What should remaining board members do when one member is involved in a transaction?

Decide if the involved board member should participate in discussion. (D) Signup and view all the answers

What is a key purpose of the disclosure requirements for related party transactions?

To ensure transactions are favorable to shareholders. (C) Signup and view all the answers

Which professional role is NOT expected within firms providing 'ranking and advice'?

Credit Rating Analyst (A) Signup and view all the answers

What is the required capital for firms engaged in ranking and advice?

No capital requirement (B) Signup and view all the answers

Which of the following roles is associated with financial consulting activities under ranking and advice?

Financial Analyst (D) Signup and view all the answers

Which authority is responsible for accrediting credit rating analysts?

Regulatory authority similar to the Authority (B) Signup and view all the answers

What type of electronic accounting system must firms licensed for dealing in securities implement?

Unified Centralised Back Office System (D) Signup and view all the answers

What function does a Promotion Manager serve within the ranking and advice category?

Promotion Specialist (D) Signup and view all the answers

Which statement is true regarding the obligations of licensed bodies for accounting systems?

They must provide a password and user-specific access. (B) Signup and view all the answers

Which of the following entities can provide ranking and advice?

A body licensed for another category by the Authority (A) Signup and view all the answers

Signup and view all the answers

Study Notes

UAE Financial Rules and Regulations

This workbook relates to syllabus version 4.0 and will cover exams from 10 September 2023 to 30 November 2025
The workbook is for study purposes only and the Chartered Institute for Securities & Investment accepts no responsibility for persons undertaking trading or investments in whatever form.
No part of this publication 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 permission of the copyright owner.
Any unauthorised act in relation to all or any part of the material may result in both a civil claim for damages and criminal prosecution.

Regulatory Infrastructure

Licensed Bodies (page 37)
Investment Funds (page 57)
Anti-Money Laundering and Combating the Financing of Terrorism (page 81)
Client Protection (page 123)
Trading (page 169)
Dubai Financial Market (DFM) (page 201)
Glossary (page 225)
Multiple Choice Questions (page 231)
Syllabus Learning Map (page 269)

Chapter One: The Regulatory Infrastructure

Introduction (page 3)
Federal Law of No. 4 of 2000 (page 3)
Securities & Commodities Authority (SCA) (page 10)
SCA Resolutions (page 16)
Corporate Governance (page 20)
Codes of Conduct (page 26)
Licence Categories and Requirements (page 28)
Accounting System Controls (page 33)

Chapter Two: Licensed Bodies

Introduction (page 39)
General Provisions (page 39)
Licensing Financial Activities (page 44)
Further Licence Applicant Requirements (page 47)

Chapter Three: Investment Funds

Local Funds (page 59)
Provisions Specific to Certain Public Investment Funds (page 64)
Cash Investment Funds (page 68)
Exchange-Traded Funds (ETFs) (page 69)
Real Estate Funds (page 72)
Evaluation of In-Kind Shares of Investment Funds (page 74)

Chapter Four: Markets

The Central Depository (page 83)
Issuing and Offering Shares in Public Joint-Stock Companies (page 86)
Troubled Public Joint-Stock Companies (page 90)
Conciliation (page 93)
Debt Securities (page 94)
Islamic Securities (page 99)
Derivatives (page 104)
Crypto Assets (page 105)

Chapter Five: Anti-Money Laundering and Combating the Financing of Terrorism

Introduction (page 125)
Offences (page 125)
The Role of the Financial Services Sector (page 126)
Prohibitions (page 130)
Politically Exposed Persons (PEPs) (page 131)
Practical Measures (page 133)
Record Keeping Requirements (page 135)
Penalties (page 135)
Market Abuse Regulations in the UAE (page 138)
Conflicts of Interest (page 139)

Chapter Six: Client Protection

Suitability Standards (page 145)
Appropriateness Standards (page 147)
Client Assets Accepted Practice (page 149)
Client Communications (page 151)
Promoters and Introducers (page 153)
Regulations for Special Purpose Acquisition Companies (page 158)

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Description

Test your knowledge about the requirements and functions related to dealing in investments. This quiz covers topics such as paid-up capital, roles within investment firms, and the types of organizations permitted to manage investment funds. Challenge yourself and see how much you know about investment management!