Conduct and Practices Handbook (CPH)
EXAM STUDY GUIDE 2026 COMPLETE
QUESTIONS WITH CORRECT DETAILED
ANSWERS || 100% GUARANTEED PASS
<LATEST VERSION>
1. Formal Take-over Bid - ANSWER ✔ An offer made to the security holders
of a company to purchase the voting securities of a company which, with the
offeror's already-owned securities, will in total exceed 20% of the
outstanding voting securities of the company.
2. Compliance - ANSWER ✔ Compliance is following the rules, whether those
rules are legal and regulatory requirements or internal policies.
3. Confidentiality - ANSWER ✔ The ethical principle that a securities industry
professional will hold secret all information relating to a client and the
client's account unless the client consents to its disclosure, or a formal
request is made by the appropriate regulators
4. Conflict of Interest - ANSWER ✔ A situation in which a registrant's
personal or financial interests conflict with those of a client or the
registrant's dealer member. In cases of potential or actual conflict of interest,
, a client's interests must be given priority and the conflict should be
disclosed.
5. Discretionary Account - ANSWER ✔ A securities account for which the
client has given a dealer member specific written authorization to make
decisions regarding the security, price, quantity or timing of orders in the
account.
6. Due Diligence - ANSWER ✔ Investigation into and verification of the
details of a potential investment, such as an examination of operations and
management, and the verification of material facts.
7. Duty of Care - ANSWER ✔ An IA's duty to his client to ensure that he/she
does everything "reasonably practicable" to protect the client's assets. This
involves devoting the time and attention necessary to make informed
decisions.
8. Also known as Standard A
9. Fiduciary Duty - ANSWER ✔ A legal term that describes a high degree of
duty of care.
10.Know Your Client (KYC) Rule - ANSWER ✔ The cardinal rule in making
investment recommendations. The IA must know all relevant information
about every client and every order to ensure that his/her recommendations to
clients are suitable.
,11.Personal Information Protection and Electronic Documents Act (PIPEDA) -
ANSWER ✔ The Act that governs each dealer member's information-
gathering processes and regulates how firms may use and disclose the
personal information that is collected in the course of doing business.
12.Registrant Standards of Conduct - ANSWER ✔ The Standards of Conduct
amplify the Code of Ethics and set out certain specifics of required behavior.
These requirements are based in large part on the provincial Securities Acts
and the SRO rules.
13.Suitability - ANSWER ✔ A registrant's major concern in making investment
recommendations. Unless a suitability exemption applies, all information
about a client and a security must be analyzed to determine whether a
particular investment is suitable for a client.
14.Unsolicited Order - ANSWER ✔ An order entered by a client where neither
the client's IA or his/her dealer member recommended the order.
15.Autorité des marchés financiers (Financial Services Authority) (AMF) -
ANSWER ✔ The body that administers the regulatory framework
surrounding Québec's financial sector securities sector.
16.Canadian Investor Protection Fund (CIPF) - ANSWER ✔ A fund that
protects investors against the insolvency of any dealer member.
, 17.Disclosure - ANSWER ✔ One of the principles of securities regulation in
Canada. This principle entails full, true and plain disclosure of all material
facts necessary to make reasoned investment decisions.
18.Financial Transactions Reports Analysis Centre of Canada (FINTRAC) -
ANSWER ✔ FINTRAC receives, analyzes, assesses and discloses financial
intelligence on suspected money laundering, terrorist financing, and threats
to the security of Canada.
19.Integrated Market Enforcement Teams (IMETs) - ANSWER ✔ An initiative
of the RCMP and the federal government to detect, investigate and deter
capital markets fraud.
20.Joint Serious Offences Team (JSOTs) - ANSWER ✔ JSOT is an
enforcement partnership between the OSC, the RCMP Financial Crime
program and the Ontario Provincial Police Anti-Rackets Branch. JSOT
investigates and prosecutes serious violations of the law using provisions of
the Securities Act (Ontario) and Criminal Code.
21.Investment Industry Association of Canada (IIAC) - ANSWER ✔ IIAC is a
member-based, advocacy association that advances the growth and
development of the Canadian investment industry.
22.Investment Industry Regulatory Organization of Canada (IIROC) -
ANSWER ✔ The national self-regulatory organization overseeing all
investment dealers and trading activity on equity and debt marketplaces in
EXAM STUDY GUIDE 2026 COMPLETE
QUESTIONS WITH CORRECT DETAILED
ANSWERS || 100% GUARANTEED PASS
<LATEST VERSION>
1. Formal Take-over Bid - ANSWER ✔ An offer made to the security holders
of a company to purchase the voting securities of a company which, with the
offeror's already-owned securities, will in total exceed 20% of the
outstanding voting securities of the company.
2. Compliance - ANSWER ✔ Compliance is following the rules, whether those
rules are legal and regulatory requirements or internal policies.
3. Confidentiality - ANSWER ✔ The ethical principle that a securities industry
professional will hold secret all information relating to a client and the
client's account unless the client consents to its disclosure, or a formal
request is made by the appropriate regulators
4. Conflict of Interest - ANSWER ✔ A situation in which a registrant's
personal or financial interests conflict with those of a client or the
registrant's dealer member. In cases of potential or actual conflict of interest,
, a client's interests must be given priority and the conflict should be
disclosed.
5. Discretionary Account - ANSWER ✔ A securities account for which the
client has given a dealer member specific written authorization to make
decisions regarding the security, price, quantity or timing of orders in the
account.
6. Due Diligence - ANSWER ✔ Investigation into and verification of the
details of a potential investment, such as an examination of operations and
management, and the verification of material facts.
7. Duty of Care - ANSWER ✔ An IA's duty to his client to ensure that he/she
does everything "reasonably practicable" to protect the client's assets. This
involves devoting the time and attention necessary to make informed
decisions.
8. Also known as Standard A
9. Fiduciary Duty - ANSWER ✔ A legal term that describes a high degree of
duty of care.
10.Know Your Client (KYC) Rule - ANSWER ✔ The cardinal rule in making
investment recommendations. The IA must know all relevant information
about every client and every order to ensure that his/her recommendations to
clients are suitable.
,11.Personal Information Protection and Electronic Documents Act (PIPEDA) -
ANSWER ✔ The Act that governs each dealer member's information-
gathering processes and regulates how firms may use and disclose the
personal information that is collected in the course of doing business.
12.Registrant Standards of Conduct - ANSWER ✔ The Standards of Conduct
amplify the Code of Ethics and set out certain specifics of required behavior.
These requirements are based in large part on the provincial Securities Acts
and the SRO rules.
13.Suitability - ANSWER ✔ A registrant's major concern in making investment
recommendations. Unless a suitability exemption applies, all information
about a client and a security must be analyzed to determine whether a
particular investment is suitable for a client.
14.Unsolicited Order - ANSWER ✔ An order entered by a client where neither
the client's IA or his/her dealer member recommended the order.
15.Autorité des marchés financiers (Financial Services Authority) (AMF) -
ANSWER ✔ The body that administers the regulatory framework
surrounding Québec's financial sector securities sector.
16.Canadian Investor Protection Fund (CIPF) - ANSWER ✔ A fund that
protects investors against the insolvency of any dealer member.
, 17.Disclosure - ANSWER ✔ One of the principles of securities regulation in
Canada. This principle entails full, true and plain disclosure of all material
facts necessary to make reasoned investment decisions.
18.Financial Transactions Reports Analysis Centre of Canada (FINTRAC) -
ANSWER ✔ FINTRAC receives, analyzes, assesses and discloses financial
intelligence on suspected money laundering, terrorist financing, and threats
to the security of Canada.
19.Integrated Market Enforcement Teams (IMETs) - ANSWER ✔ An initiative
of the RCMP and the federal government to detect, investigate and deter
capital markets fraud.
20.Joint Serious Offences Team (JSOTs) - ANSWER ✔ JSOT is an
enforcement partnership between the OSC, the RCMP Financial Crime
program and the Ontario Provincial Police Anti-Rackets Branch. JSOT
investigates and prosecutes serious violations of the law using provisions of
the Securities Act (Ontario) and Criminal Code.
21.Investment Industry Association of Canada (IIAC) - ANSWER ✔ IIAC is a
member-based, advocacy association that advances the growth and
development of the Canadian investment industry.
22.Investment Industry Regulatory Organization of Canada (IIROC) -
ANSWER ✔ The national self-regulatory organization overseeing all
investment dealers and trading activity on equity and debt marketplaces in
