IFSE FINAL EXAM 2026 ACTUAL QUESTIONS AND
SOLUTIONS SCORED A+
✔✔What kind of integrity requirements are there for registration? - ✔✔- Financial
condition
- Insurance
✔✔What form is completed for an application for registration? - ✔✔Form 33-109F4
(Registration of Individuals and Review of Permitted Individuals)
✔✔Changes must be filed with the securities regulators within 30 days of the date of
change of what? - ✔✔- Change in business history and structure
- Details regarding any change in or termination of the directors or officers of the dealer,
or the
termination or cessation of authority of a registered or permitted individual of the dealer
✔✔What is the fee for failing to notify a regulator of a change in details in Ontario? -
✔✔$100 per business day (subject to a maximum of $5,000 for all documents within
one
financial year)
✔✔Under NI 31-103, an exempt market dealer's registration lasts for how long? -
✔✔Considered permanent unless cancelled,
surrendered, or suspended
✔✔The Northwestern Exemption applies to which prospectus exemptions in NI 45-106?
- ✔✔- accredited investor exemption
- minimum purchase exemption (where an investor invests $150,000 or more in a single
transaction)
- offering memorandum exemption
- family, friends, and business associates exemption
✔✔To rely on a Northwestern Exemption blanket order, an individual or firm must do
what? - ✔✔- NOT BE REGISTERED in any category of registration in any jurisdiction
- NOT PROVIDE SUITABILITY ADVICE about the trade to the purchaser
- NOT OTHERWISE PROVIDE FINANCIAL SERVICES to the purchaser
- NOT HOLD OR HAVE ACCESS TO THE PURCHASER'S ASSETS
- PROVIDE RISK DISCLOSURE in the prescribed form to the purchaser
- FILE AN INFORMATION REPORT with the securities commission/regulator
✔✔National Instrument 31-103 (NI 31-103) section 11 requires all registered firms to do
what? - ✔✔Establish, maintain, and apply a system of controls and supervision
sufficient to provide reasonable assurance that:
- the firm complies with securities legislation; and
,- the risks associated with its business are managed in accordance with prudent
business practices
✔✔Effective compliance programs should do what? - ✔✔- Allocate sufficient
RESOURCES to support an effective compliance regime
- create measures and systems that ENCOURAGE and reward compliant behavior and
DISCOURAGE noncompliant behavior
- ensure that the Chief Compliance Officer (CCO) has access to senior management
and the board of directors to keep them informed of compliance issues and
developments
✔✔Key components of the compliance regime include what? - ✔✔- Visible
COMMITMENT to compliance from senior management and the board of directors
- Adequate RESOURCES committed to compliance including qualified compliance
personnel and proper training programs for everyone in the firm
- DETAILED WRITTEN policies and procedures
- DETAILED RECORDS of compliance activities
✔✔While compliance is an enterprise-wide responsibility, EMDs must designate
qualified individuals who have
specific compliance responsibilities including which? - ✔✔- Ultimate Designated Person
(UDP)
- Chief Compliance Officer (CCO)
- Board of Directors
- Compliance Personnel and Branch Managers
✔✔The CCO must submit a report to the firm's board of directors for the purpose of
assessing compliance with securities legislation how often? - ✔✔Annually
✔✔Who's function is it to:
- supervise the activities of the firm to ensure
compliance with securities legislation and regulations
- promote compliance with securities legislation
and regulations by the firm - ✔✔Ultimate Designated Person (UDP)
✔✔Who's function is it to:
- establish and maintain policies and procedures
for assessing the firm's compliance with securities
legislation and regulations
- monitor and assess the firm's compliance with
securities legislation and regulations - ✔✔Chief Compliance Officer
✔✔Who's function is it to act based on compliance reports? - ✔✔Board of Directors
✔✔Who's function is it to perform supervisory reviews to:
, - monitor and assess business activities
- identify exceptions
- remedy exceptions
- maintain records of supervisory reviews
- escalate instances of non-compliance to their
managers/the CCO where required - ✔✔Compliance Personnel and Branch Managers
✔✔Exempt market dealers' Policies and Procedures Manuals should include what? -
✔✔- establish internal controls to monitor risk
- establish standards of conduct
- clearly outline supervisory procedures
- be easily accessible to everyone who is expected to know and follow the policies and
procedures
- be updated when regulatory requirements or business practices change
- consider the obligation to deal fairly, honestly, and in good faith with clients
✔✔For EMDs, the compliance function is generally comprised of which two distinct
areas of compliance? - ✔✔- business conduct compliance (also known as "sales
compliance")
- financial compliance
✔✔As per NI 31-103, effective day-to-day monitoring includes what? - ✔✔- approving
new account documents
- reviewing transactions
- reviewing marketing materials
- preventing inappropriate use or disclosure of non-public information
✔✔Where Excess Working Capital (EWC) falls below zero, the registered firm must do
what? - ✔✔Notify the securities regulator immediately
✔✔EMDs are required to obtain and maintain bonding and insurance to protect against
losses including which five events? - ✔✔- Fidelity
- Premises
- In Transit and Mail
- Forgery or Alterations
- Securities
✔✔Why are EMDs required to maintain books and records? - ✔✔In order to:
• accurately record its:
- business activities
- financial affairs
- client transactions
• demonstrate the EMD's compliance with regulatory requirements and legislation
SOLUTIONS SCORED A+
✔✔What kind of integrity requirements are there for registration? - ✔✔- Financial
condition
- Insurance
✔✔What form is completed for an application for registration? - ✔✔Form 33-109F4
(Registration of Individuals and Review of Permitted Individuals)
✔✔Changes must be filed with the securities regulators within 30 days of the date of
change of what? - ✔✔- Change in business history and structure
- Details regarding any change in or termination of the directors or officers of the dealer,
or the
termination or cessation of authority of a registered or permitted individual of the dealer
✔✔What is the fee for failing to notify a regulator of a change in details in Ontario? -
✔✔$100 per business day (subject to a maximum of $5,000 for all documents within
one
financial year)
✔✔Under NI 31-103, an exempt market dealer's registration lasts for how long? -
✔✔Considered permanent unless cancelled,
surrendered, or suspended
✔✔The Northwestern Exemption applies to which prospectus exemptions in NI 45-106?
- ✔✔- accredited investor exemption
- minimum purchase exemption (where an investor invests $150,000 or more in a single
transaction)
- offering memorandum exemption
- family, friends, and business associates exemption
✔✔To rely on a Northwestern Exemption blanket order, an individual or firm must do
what? - ✔✔- NOT BE REGISTERED in any category of registration in any jurisdiction
- NOT PROVIDE SUITABILITY ADVICE about the trade to the purchaser
- NOT OTHERWISE PROVIDE FINANCIAL SERVICES to the purchaser
- NOT HOLD OR HAVE ACCESS TO THE PURCHASER'S ASSETS
- PROVIDE RISK DISCLOSURE in the prescribed form to the purchaser
- FILE AN INFORMATION REPORT with the securities commission/regulator
✔✔National Instrument 31-103 (NI 31-103) section 11 requires all registered firms to do
what? - ✔✔Establish, maintain, and apply a system of controls and supervision
sufficient to provide reasonable assurance that:
- the firm complies with securities legislation; and
,- the risks associated with its business are managed in accordance with prudent
business practices
✔✔Effective compliance programs should do what? - ✔✔- Allocate sufficient
RESOURCES to support an effective compliance regime
- create measures and systems that ENCOURAGE and reward compliant behavior and
DISCOURAGE noncompliant behavior
- ensure that the Chief Compliance Officer (CCO) has access to senior management
and the board of directors to keep them informed of compliance issues and
developments
✔✔Key components of the compliance regime include what? - ✔✔- Visible
COMMITMENT to compliance from senior management and the board of directors
- Adequate RESOURCES committed to compliance including qualified compliance
personnel and proper training programs for everyone in the firm
- DETAILED WRITTEN policies and procedures
- DETAILED RECORDS of compliance activities
✔✔While compliance is an enterprise-wide responsibility, EMDs must designate
qualified individuals who have
specific compliance responsibilities including which? - ✔✔- Ultimate Designated Person
(UDP)
- Chief Compliance Officer (CCO)
- Board of Directors
- Compliance Personnel and Branch Managers
✔✔The CCO must submit a report to the firm's board of directors for the purpose of
assessing compliance with securities legislation how often? - ✔✔Annually
✔✔Who's function is it to:
- supervise the activities of the firm to ensure
compliance with securities legislation and regulations
- promote compliance with securities legislation
and regulations by the firm - ✔✔Ultimate Designated Person (UDP)
✔✔Who's function is it to:
- establish and maintain policies and procedures
for assessing the firm's compliance with securities
legislation and regulations
- monitor and assess the firm's compliance with
securities legislation and regulations - ✔✔Chief Compliance Officer
✔✔Who's function is it to act based on compliance reports? - ✔✔Board of Directors
✔✔Who's function is it to perform supervisory reviews to:
, - monitor and assess business activities
- identify exceptions
- remedy exceptions
- maintain records of supervisory reviews
- escalate instances of non-compliance to their
managers/the CCO where required - ✔✔Compliance Personnel and Branch Managers
✔✔Exempt market dealers' Policies and Procedures Manuals should include what? -
✔✔- establish internal controls to monitor risk
- establish standards of conduct
- clearly outline supervisory procedures
- be easily accessible to everyone who is expected to know and follow the policies and
procedures
- be updated when regulatory requirements or business practices change
- consider the obligation to deal fairly, honestly, and in good faith with clients
✔✔For EMDs, the compliance function is generally comprised of which two distinct
areas of compliance? - ✔✔- business conduct compliance (also known as "sales
compliance")
- financial compliance
✔✔As per NI 31-103, effective day-to-day monitoring includes what? - ✔✔- approving
new account documents
- reviewing transactions
- reviewing marketing materials
- preventing inappropriate use or disclosure of non-public information
✔✔Where Excess Working Capital (EWC) falls below zero, the registered firm must do
what? - ✔✔Notify the securities regulator immediately
✔✔EMDs are required to obtain and maintain bonding and insurance to protect against
losses including which five events? - ✔✔- Fidelity
- Premises
- In Transit and Mail
- Forgery or Alterations
- Securities
✔✔Why are EMDs required to maintain books and records? - ✔✔In order to:
• accurately record its:
- business activities
- financial affairs
- client transactions
• demonstrate the EMD's compliance with regulatory requirements and legislation
