FP1 FULL PRACTICE EXAM QUESTIONS
2025-2026 WITH 100% CORRECT
ANSWERS
Which statement regarding the traits or values of financial advisors is correct?
A. Professionalism is displayed by being competent and knowledgeable.
B. Diligence is displayed by being honest with clients.
C. Objectivity requires respecting clients' privacy.
D. Confidentiality requires the advisor to make impartial recommendations. - ANSWER -A.
Professionalism is displayed by being competent and knowledgeable.
Professionalism is displayed by being competent and knowledgeable by keeping up to date regarding
key aspects of the financial services industry.
By and large, what statement below is true in regards to the current landscape in Canada for financial
advisors?
A. There has been a dramatic shift to fee based advice as it's perceived as unbiased.
B. The role has shifted to a client driven model where building a strong client relationship is key.
C. The business is now product driven where it's all about selling higher commissioned products.
D. The industry is focusing on reducing costs and finding the most inexpensive investments for clients. -
ANSWER -B. The role has shifted to a client driven model where building a strong client relationship is
key.
The role of the Advisor in the financial services industry has changed in recent years from one that is
product driven to one that is client driven. Reference: Module 1, Section 1
Which statements about the evolution of the role of financial advisors is/are correct?
FP1 FULL PRACTICE EXAM QUESTIONS 2024-2025 WITH 100% CORRECT ANSWERS
,[I] The financial services industry has moved towards an integrated market and so have advisors.
[II] Advisors have fewer products and services to offer to clients.
[III] Advisors require a greater level of knowledge to recommend sophisticated alternatives to clients.
A. I only.
B. I and III only.
C. II and III only.
D. I and II only. - ANSWER -B. I and III only.
Advisors have to work within a highly integrated financial services market and must possess a much
higher level of knowledge than before to satisfy increasingly sophisticated clients.
Select the first step in the financial planning process.
A. Analyzing a client's data and information.
B. Recommending strategies to meet goals.
C. Establishing a relationship with the client.
D. Collecting a client's data and information. - ANSWER -C. Establishing a relationship with the client.
The first step in the financial planning process is for an advisor to establish a relationship with the client;
everything else follows.
Select the item that would provide you with quantitative data about your new client.
A. Profit sharing plan statement.
B. Risk tolerance assessment.
C. Goal setting questionnaire.
D. Fees and services agreement. - ANSWER -A. Profit sharing plan statement.
FP1 FULL PRACTICE EXAM QUESTIONS 2024-2025 WITH 100% CORRECT ANSWERS
,Only the profit-sharing statement would provide you with quantitative data, i.e. numeric or other
specific data that can be quantified. The other options would provide qualitative data. Reference:
Module 1, Section 2.
Your aclient's agoal ais ato aimprove aher acash aflow. aSelect athe astrategy athat awill abe amost aeffective
ain ahelping aher ato areach aher agoal.
A. aImprove ainvestment areturn. a
B. aReduce aflexible aexpenses aand alengthen atime aframe afor ainvestments. a
C. aIncrease aincome aand areduce aexpenses. a
D. aContribute aregularly ato aan aemergency afund. a- aANSWER a-C. aIncrease aincome aand areduce
aexpenses.
Cash aflow ais athe aamount aof amoney aavailable afor ainvestment aor aother apurposes. aIn athis
ascenario, athe aclient ais abest aable ato afree aup amoney afor ainvestments aby aincreasing athe aamount
aof amoney acoming ain a(income) aand areducing athe aamount aof amoney agoing aout a(expenses). aWhile
a(b) awould aimprove acash aflow aby areducing asome aexpenses, athe aaddition aof athe aincrease ain
aincome ain a(c) amakes ait amore aeffective.
Kim adoes anot arecommend aan ainvestment afund ato aher aclients athat ais aheavily apromoted aby aher
aown afirm's amarketing adepartment abecause aher aanalysis ademonstrates athat ait ais anot aconsistent
afor aher aclients' agoals. aSelect athe atype aof aresponsibility athat ashe ais ademonstrating.
A. aIntegrity. a
B. aProfessionalism. a
C. aObjectivity.
D. aDiligence. a- aANSWER a-C. aObjectivity.
Kim ais afulfilling athe aresponsibility aof a"Objectivity" awhich astates athat aan aadviser amust anot amake
arecommendations athat abenefit athe aadviser aor athe aadviser's ainstitution awhen athere aare aother
aproducts aand aservices athat amight aserve aan aadviser's aclients abetter. aReference: aModule a1,
aSection a2.
FP1 FULL PRACTICE EXAM QUESTIONS 2024-2025 WITH 100% CORRECT ANSWERS
, Select athe amost auseful agoal afor asetting ainvestment apriorities.
A. a"I'm anot asure awhen awe'll aretire, abut awe awant ato abe aable ato atravel afor a10 aor aso ayears aat
athat atime." a
B. a"We awant ato abuy aa abig ahouse ain aa anice aneighbourhood" a
aC. a"We awill aneed a70% aof aour acurrent aincome alevel ato aretire aand amaintain aour alifestyle." a
D. a"I awant ato abe aable ato aretire acomfortably abased aon amy acurrent alifestyle." a- aANSWER a-C. a"We
awill aneed a70% aof aour acurrent aincome alevel ato aretire aand amaintain aour alifestyle."
General aFeedback:
Options aa, ab, aand ad aare anot ameasurable aor aquantifiable; aonly ac ais ameasurable aand aquantifiable.
aThus, aonly a"c" ais ausual afor asetting apriorities. aEncouraging aclients ato aset aspecific, ameasurable
atargets ainstead aof avague aand ageneral agoals aserves atwo afunctions:
It ahelps ato aclearly aand aexplicitly adefine afinancial aobjectives.
It ahelps ato ameasure aand amonitor athe aperformance aof athe afinancial aplan.
Reference: aModule a1, aSection a2
Nabila, aan aadvisor, areceives aa acall afrom aan ainsurance abroker aasking afor ainformation aabout athe
aassets ashe amanages afor aa aclient. aNabila arefuses ato aspeak ato athe abroker aabout aher aclient
awithout athe aclient's apermission. aWhat atype aof aresponsibility ais ahe ademonstrating?
A. aIntegrity. a
B. aProfessionalism. a
C. aConfidentiality.
D. aDiligence. a- aANSWER a-C. aConfidentiality.
General aFeedback: aNabila ais afulfilling athe aresponsibility aof aConfidentiality, awhich astates athat aan
aadviser amust arespect aa aclients' aprivacy aand atreat atheir ainformation awith aconfidentiality.
aReference: aModule a1, aSection a2.
FP1 FULL PRACTICE EXAM QUESTIONS 2024-2025 WITH 100% CORRECT ANSWERS
2025-2026 WITH 100% CORRECT
ANSWERS
Which statement regarding the traits or values of financial advisors is correct?
A. Professionalism is displayed by being competent and knowledgeable.
B. Diligence is displayed by being honest with clients.
C. Objectivity requires respecting clients' privacy.
D. Confidentiality requires the advisor to make impartial recommendations. - ANSWER -A.
Professionalism is displayed by being competent and knowledgeable.
Professionalism is displayed by being competent and knowledgeable by keeping up to date regarding
key aspects of the financial services industry.
By and large, what statement below is true in regards to the current landscape in Canada for financial
advisors?
A. There has been a dramatic shift to fee based advice as it's perceived as unbiased.
B. The role has shifted to a client driven model where building a strong client relationship is key.
C. The business is now product driven where it's all about selling higher commissioned products.
D. The industry is focusing on reducing costs and finding the most inexpensive investments for clients. -
ANSWER -B. The role has shifted to a client driven model where building a strong client relationship is
key.
The role of the Advisor in the financial services industry has changed in recent years from one that is
product driven to one that is client driven. Reference: Module 1, Section 1
Which statements about the evolution of the role of financial advisors is/are correct?
FP1 FULL PRACTICE EXAM QUESTIONS 2024-2025 WITH 100% CORRECT ANSWERS
,[I] The financial services industry has moved towards an integrated market and so have advisors.
[II] Advisors have fewer products and services to offer to clients.
[III] Advisors require a greater level of knowledge to recommend sophisticated alternatives to clients.
A. I only.
B. I and III only.
C. II and III only.
D. I and II only. - ANSWER -B. I and III only.
Advisors have to work within a highly integrated financial services market and must possess a much
higher level of knowledge than before to satisfy increasingly sophisticated clients.
Select the first step in the financial planning process.
A. Analyzing a client's data and information.
B. Recommending strategies to meet goals.
C. Establishing a relationship with the client.
D. Collecting a client's data and information. - ANSWER -C. Establishing a relationship with the client.
The first step in the financial planning process is for an advisor to establish a relationship with the client;
everything else follows.
Select the item that would provide you with quantitative data about your new client.
A. Profit sharing plan statement.
B. Risk tolerance assessment.
C. Goal setting questionnaire.
D. Fees and services agreement. - ANSWER -A. Profit sharing plan statement.
FP1 FULL PRACTICE EXAM QUESTIONS 2024-2025 WITH 100% CORRECT ANSWERS
,Only the profit-sharing statement would provide you with quantitative data, i.e. numeric or other
specific data that can be quantified. The other options would provide qualitative data. Reference:
Module 1, Section 2.
Your aclient's agoal ais ato aimprove aher acash aflow. aSelect athe astrategy athat awill abe amost aeffective
ain ahelping aher ato areach aher agoal.
A. aImprove ainvestment areturn. a
B. aReduce aflexible aexpenses aand alengthen atime aframe afor ainvestments. a
C. aIncrease aincome aand areduce aexpenses. a
D. aContribute aregularly ato aan aemergency afund. a- aANSWER a-C. aIncrease aincome aand areduce
aexpenses.
Cash aflow ais athe aamount aof amoney aavailable afor ainvestment aor aother apurposes. aIn athis
ascenario, athe aclient ais abest aable ato afree aup amoney afor ainvestments aby aincreasing athe aamount
aof amoney acoming ain a(income) aand areducing athe aamount aof amoney agoing aout a(expenses). aWhile
a(b) awould aimprove acash aflow aby areducing asome aexpenses, athe aaddition aof athe aincrease ain
aincome ain a(c) amakes ait amore aeffective.
Kim adoes anot arecommend aan ainvestment afund ato aher aclients athat ais aheavily apromoted aby aher
aown afirm's amarketing adepartment abecause aher aanalysis ademonstrates athat ait ais anot aconsistent
afor aher aclients' agoals. aSelect athe atype aof aresponsibility athat ashe ais ademonstrating.
A. aIntegrity. a
B. aProfessionalism. a
C. aObjectivity.
D. aDiligence. a- aANSWER a-C. aObjectivity.
Kim ais afulfilling athe aresponsibility aof a"Objectivity" awhich astates athat aan aadviser amust anot amake
arecommendations athat abenefit athe aadviser aor athe aadviser's ainstitution awhen athere aare aother
aproducts aand aservices athat amight aserve aan aadviser's aclients abetter. aReference: aModule a1,
aSection a2.
FP1 FULL PRACTICE EXAM QUESTIONS 2024-2025 WITH 100% CORRECT ANSWERS
, Select athe amost auseful agoal afor asetting ainvestment apriorities.
A. a"I'm anot asure awhen awe'll aretire, abut awe awant ato abe aable ato atravel afor a10 aor aso ayears aat
athat atime." a
B. a"We awant ato abuy aa abig ahouse ain aa anice aneighbourhood" a
aC. a"We awill aneed a70% aof aour acurrent aincome alevel ato aretire aand amaintain aour alifestyle." a
D. a"I awant ato abe aable ato aretire acomfortably abased aon amy acurrent alifestyle." a- aANSWER a-C. a"We
awill aneed a70% aof aour acurrent aincome alevel ato aretire aand amaintain aour alifestyle."
General aFeedback:
Options aa, ab, aand ad aare anot ameasurable aor aquantifiable; aonly ac ais ameasurable aand aquantifiable.
aThus, aonly a"c" ais ausual afor asetting apriorities. aEncouraging aclients ato aset aspecific, ameasurable
atargets ainstead aof avague aand ageneral agoals aserves atwo afunctions:
It ahelps ato aclearly aand aexplicitly adefine afinancial aobjectives.
It ahelps ato ameasure aand amonitor athe aperformance aof athe afinancial aplan.
Reference: aModule a1, aSection a2
Nabila, aan aadvisor, areceives aa acall afrom aan ainsurance abroker aasking afor ainformation aabout athe
aassets ashe amanages afor aa aclient. aNabila arefuses ato aspeak ato athe abroker aabout aher aclient
awithout athe aclient's apermission. aWhat atype aof aresponsibility ais ahe ademonstrating?
A. aIntegrity. a
B. aProfessionalism. a
C. aConfidentiality.
D. aDiligence. a- aANSWER a-C. aConfidentiality.
General aFeedback: aNabila ais afulfilling athe aresponsibility aof aConfidentiality, awhich astates athat aan
aadviser amust arespect aa aclients' aprivacy aand atreat atheir ainformation awith aconfidentiality.
aReference: aModule a1, aSection a2.
FP1 FULL PRACTICE EXAM QUESTIONS 2024-2025 WITH 100% CORRECT ANSWERS
