IACCP ACTUAL EXAM QUESTIONS WITH SOLUTIONS A+
2025/2026
✔✔Which THREE of the following advisers are exempt from SEC registration?
(Choosethree.) - ✔✔An adviser whose only clients are venture capital funds.
A UK-based adviser whose only client is a private fund with 12 U.S.investors.
A US-based adviser whose only client is a private fund with $100million Regulatory
Assets Under Management (RAUM).
✔✔What is the PRIMARY reason the SEC requires investment advisers to file an
annualupdating amendment to Form ADV Part 1A? - ✔✔To reaffirm eligibility for the
investment adviser to remain registered with the SEC.
✔✔According to the SEC Books and Records Rule, which length of time must advisers
whouse performance data in their advertisements maintain the advertisements and all
datasupporting the performance figures? - ✔✔Five years after the end of the fiscal year
in which theadvertisement/performance was last disseminated.
✔✔Under the Compliance Program Rule, it is a best practice to create which TWO of
thefollowing records? (Choose two.) - ✔✔Written policies and procedures. Amendments
to written policies and procedures.
✔✔Which THREE types of clients can be charged performance-based fees under
theInvestment Advisers Act of 1940? (Choose three.) - ✔✔Hedge funds established
under Investment Company Act Section 3(c)(7) (exemption for private funds).
Clients with at least $1.1 million under management with the adviseror a minimum net
worth of $2.2 million.
Mutual funds having more than $1 million in managed assets.
✔✔Which situation is considered eligible "research" under the SEC's guidance on
softdollars? - ✔✔Proprietary reports from brokers on client-held securities.
✔✔An investment adviser's code of ethics requires a complete report of each firm's
accessperson's securities holdings, at the time the person becomes an access person
and atleast how frequently thereafter? - ✔✔Annually
✔✔All financial institutions including investment advisers must fulfill which THREE
requirements regardingcompliance with OFAC? (Choose three.) - ✔✔Freeze or reject
all funds and transactions of persons on the SDN Listor otherwise subject to an OFAC
administered sanctions program. File by September 30th of each year a comprehensive
report on allblocked property held as of June 30 of the current year.
Notify OFAC within 10 days of any blocked or rejected transactions.
, ✔✔Traders 1, 2, 3, and 4 use Broker A for 5-15% of their trades, while Trader 5 uses
Broker Afor 60% of his trades. An investigation by Compliance discovers that Broker A
hasregularly paid for repairs and maintenance on Trader 5's sports car. However, it
appearsthat Trader 5's use of Broker A is consistent with obtaining best execution. The
firm'sBrochure does not contain any disclosure concerning the receipt of gifts.
If Adviser's code of ethics does not have a prohibition on accepting gifts from brokers,
hasTrader 5 violated the Adviser's fiduciary duties to its clients? - ✔✔Yes, because the
receipt of expensive gifts and concomitant conflicts of interest should be disclosed to
clients.
✔✔Under which TWO circumstances is an investment adviser required to register with
theSEC? (Choose two.) - ✔✔Providing investment advice exclusively through an
interactivewebsite.
Acting as adviser to a registered investment company.
✔✔Great Big Holding Company is the sole owner of two large financial services firms:
GreatBig Adviser (an SEC-registered adviser) and Great Big Broker. Great Big Adviser
is thesole owner of Little Insurance and Great Big Broker is the sole owner of Little Tax
Prep.
Frank is the President of Little Insurance and Vice President of Great Big
HoldingCompany.
Tim is the President of Great Big Broker and President of Little Tax Prep.
Jeff is President of Great Big Adviser and a registered representative of Great
BigBroker.
Greg is the President of Little Tax Prep and an investment adviser representative
ofGreat Big Adviser.
According to the Glossary in the Form ADV instructions, Frank, Tim, Jeff, and Greg are
all"related persons" of Great Big Adviser.
Which person is NOT an "advisory affiliate" of Great Big Adviser? - ✔✔Tim
✔✔Investment Advisory Firm A refers a client to Investment Advisory Firm B for a fee.
Which TWO types of disclosures would Firm A be required to provide to the
client?(Choose two.) - ✔✔The material terms of any compensation arrangement,
including adescription of the compensation provided or to be provided, directly
orindirectly, to Firm A.
A brief statement of any material conflicts of interest on the part ofFirm A.
✔✔An SEC-registered adviser must provide a Form ADV Part 2A Firm Brochure to
whichTWO clients? (Choose two.) - ✔✔The general partner of a hedge fund to which
the SEC-registeredadviser provides portfolio management services. A 401K plan to
which the SEC-registered adviser provides pensionconsulting services.
✔✔An investment adviser's status as a "fiduciary" is derived from - ✔✔U.S. Supreme
Court case law.
2025/2026
✔✔Which THREE of the following advisers are exempt from SEC registration?
(Choosethree.) - ✔✔An adviser whose only clients are venture capital funds.
A UK-based adviser whose only client is a private fund with 12 U.S.investors.
A US-based adviser whose only client is a private fund with $100million Regulatory
Assets Under Management (RAUM).
✔✔What is the PRIMARY reason the SEC requires investment advisers to file an
annualupdating amendment to Form ADV Part 1A? - ✔✔To reaffirm eligibility for the
investment adviser to remain registered with the SEC.
✔✔According to the SEC Books and Records Rule, which length of time must advisers
whouse performance data in their advertisements maintain the advertisements and all
datasupporting the performance figures? - ✔✔Five years after the end of the fiscal year
in which theadvertisement/performance was last disseminated.
✔✔Under the Compliance Program Rule, it is a best practice to create which TWO of
thefollowing records? (Choose two.) - ✔✔Written policies and procedures. Amendments
to written policies and procedures.
✔✔Which THREE types of clients can be charged performance-based fees under
theInvestment Advisers Act of 1940? (Choose three.) - ✔✔Hedge funds established
under Investment Company Act Section 3(c)(7) (exemption for private funds).
Clients with at least $1.1 million under management with the adviseror a minimum net
worth of $2.2 million.
Mutual funds having more than $1 million in managed assets.
✔✔Which situation is considered eligible "research" under the SEC's guidance on
softdollars? - ✔✔Proprietary reports from brokers on client-held securities.
✔✔An investment adviser's code of ethics requires a complete report of each firm's
accessperson's securities holdings, at the time the person becomes an access person
and atleast how frequently thereafter? - ✔✔Annually
✔✔All financial institutions including investment advisers must fulfill which THREE
requirements regardingcompliance with OFAC? (Choose three.) - ✔✔Freeze or reject
all funds and transactions of persons on the SDN Listor otherwise subject to an OFAC
administered sanctions program. File by September 30th of each year a comprehensive
report on allblocked property held as of June 30 of the current year.
Notify OFAC within 10 days of any blocked or rejected transactions.
, ✔✔Traders 1, 2, 3, and 4 use Broker A for 5-15% of their trades, while Trader 5 uses
Broker Afor 60% of his trades. An investigation by Compliance discovers that Broker A
hasregularly paid for repairs and maintenance on Trader 5's sports car. However, it
appearsthat Trader 5's use of Broker A is consistent with obtaining best execution. The
firm'sBrochure does not contain any disclosure concerning the receipt of gifts.
If Adviser's code of ethics does not have a prohibition on accepting gifts from brokers,
hasTrader 5 violated the Adviser's fiduciary duties to its clients? - ✔✔Yes, because the
receipt of expensive gifts and concomitant conflicts of interest should be disclosed to
clients.
✔✔Under which TWO circumstances is an investment adviser required to register with
theSEC? (Choose two.) - ✔✔Providing investment advice exclusively through an
interactivewebsite.
Acting as adviser to a registered investment company.
✔✔Great Big Holding Company is the sole owner of two large financial services firms:
GreatBig Adviser (an SEC-registered adviser) and Great Big Broker. Great Big Adviser
is thesole owner of Little Insurance and Great Big Broker is the sole owner of Little Tax
Prep.
Frank is the President of Little Insurance and Vice President of Great Big
HoldingCompany.
Tim is the President of Great Big Broker and President of Little Tax Prep.
Jeff is President of Great Big Adviser and a registered representative of Great
BigBroker.
Greg is the President of Little Tax Prep and an investment adviser representative
ofGreat Big Adviser.
According to the Glossary in the Form ADV instructions, Frank, Tim, Jeff, and Greg are
all"related persons" of Great Big Adviser.
Which person is NOT an "advisory affiliate" of Great Big Adviser? - ✔✔Tim
✔✔Investment Advisory Firm A refers a client to Investment Advisory Firm B for a fee.
Which TWO types of disclosures would Firm A be required to provide to the
client?(Choose two.) - ✔✔The material terms of any compensation arrangement,
including adescription of the compensation provided or to be provided, directly
orindirectly, to Firm A.
A brief statement of any material conflicts of interest on the part ofFirm A.
✔✔An SEC-registered adviser must provide a Form ADV Part 2A Firm Brochure to
whichTWO clients? (Choose two.) - ✔✔The general partner of a hedge fund to which
the SEC-registeredadviser provides portfolio management services. A 401K plan to
which the SEC-registered adviser provides pensionconsulting services.
✔✔An investment adviser's status as a "fiduciary" is derived from - ✔✔U.S. Supreme
Court case law.
