Page 168 - CAPE Financial Services Syllabus Macmillan_Neat

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27. To create an effective internal controls system, the authorized persons may take all of the
following steps, except

(A) establishing an appropriate organization structure
(B) ensuring the effectiveness of the accounting control
(C) segregating duties so that there are "checks and balances"
(D) combining the authorization and approval processes to avoid delays

28. An effective compliance function mitigates an authorized person's regulatory risk of non-
compliance with Capital Market laws and its implementing regulations.

Which of the following is a benefit of compliance?

(A) Existence of a clear process, standard and procedures that are applied to everyone
(B) Appropriate standard operating procedures and systems
(C) Company failure- incurring losses, fines and penalties
(D) Competent and professional conduct

29. Market intermediaries should be required to comply with which of the following
mandates?

(A) Standards for internal organization and operational conduct
(B) Provide periodic reports to the Board or Governing body
(C) Provide guidance, supervision and training of staff
(D) Prepare compliance report to regulatory authority

30. Which of the following is a consequence of non-compliance in financial services?

(A) Low staff morale
(B) No investor confidence
(C) Lack of Corporate Governance
(D) Loss of good standing and reputation in the market

31. Which of the following are included in Financial statements?

(A) Federal income tax return
(B) Statement of Cash Flows
(C) Current and Capital Statement
(D) Assets and Liabilities statement

32. The primary objective of financial reporting is to provide information about a firm’s

02269010/SPEC2016

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