IACCP Actual Questions and Correct Answers
Q1
Which THREE are consistent with Form ADV amendment requirements under the Investment
Advisers Act of 1940? (Choose three.) Update Form ADV Part 1 annually and file within 90 days
of adviser's fiscal year end. Amend Form ADV Part 1 within three months of a change in control
or in executive officers. File amendments to Form ADV Part 1 electronically via the IARD
system. Upload Form ADV Part 2 amendments to the SEC via the IARD system.
Answer: Update Form ADV Part 1 annually and file within 90 days of adviser's fiscal
year end. Amend Form ADV Part 1 within three months of a change in control or in
executive officers.C. File amendments to Form ADV Part 1 electronically via the IARD
system.
Q2
XYZ Investment Adviser has been found to have engaged in numerous prohibited activities.
Which THREE measures may the SEC impose? (Choose three.) Censure Suspension Revocation
of registration Criminal indictment
Answer: A. Censure B. Suspension D. Criminal indictment
Q3
Which THREE items must be included on an order memorandum as required by the Books and
Records Rule under the Investment Advisers Act of 1940? (Choose three.) Identification of
discretionary/non-discretionary authority. Name of the individual entering the order. Date the
order was entered with the broker. Name of the exchange involved.
Answer: A. Identification of discretionary/non-discretionary authority.B. Name of the
individual entering the order. C. Date the order was entered with the broker.
Q4
Which activity is NOT a retention requirement of the Books and Records Rule under the
Investment Advisers Act of 1940? All books and records must be maintained and preserved in
an easily accessible place for five years from the end of the fiscal year in which the record was
created. All records must be maintained for the first two years in an appropriate office of the
adviser. Duplicate copies of any electronic records must be maintained. Corporate records must
be maintained with the attorney of record.
Answer: D. Corporate records must be maintained with the attorney of record.
Q5
An investment adviser stopped
Answer: B. 2009
, Q6
It must maintain all worksheets
Answer: B. 2009
Q7
Which example is INSUFFICIENT to support a finding of fraud under the Investment Advisers Act
of 1940? Directing trades to a broker that refunds back a portion of client commissions to the
firm. Allocating trades to benefit those accounts paying the highest fees or the firm's
proprietary account. Paying an adviser's operating costs with funds received from a broker for
client reimbursements. Violating a client's sector guidelines due to capital appreciation in that
particular sector.
Answer: D. Violating a client's sector guidelines due to capital appreciation in that
particular sector.
Q8
Sam travels weekly from his Alabama office to Georgia to meet with clients at his vacation
home. Under the Investment Advisers Act of 1940, the vacation home would technically be
considered: A principal place of business. An office of supervisory jurisdiction. A place of
business. A convenient meeting place for his clients.
Answer: C. A place of business.
Q9
States have the authority to enforce which TWO of the following for SEC-registered advisers?
(Choose two.) Additional books and records requirements. Advisory notice filing. Errors and
omissions insurance. Investment Adviser Representative registrations.
Answer: B. Advisory notice filing. D. Investment Adviser Representative registrations.
Q10
In determining materiality for purposes of disclosing disciplinary information in Form ADV Part
2, all of the following are considered EXCEPT the: proximity of the person to the investment
function. nature of the infraction that lead to the disciplinary event. severity of the disciplinary
sanctions. degree of internal control weakness surrounding the event.
Answer: A. proximity of the person to the investment function.
Q11
An investment adviser manages
Answer: B. 3
Q1
Which THREE are consistent with Form ADV amendment requirements under the Investment
Advisers Act of 1940? (Choose three.) Update Form ADV Part 1 annually and file within 90 days
of adviser's fiscal year end. Amend Form ADV Part 1 within three months of a change in control
or in executive officers. File amendments to Form ADV Part 1 electronically via the IARD
system. Upload Form ADV Part 2 amendments to the SEC via the IARD system.
Answer: Update Form ADV Part 1 annually and file within 90 days of adviser's fiscal
year end. Amend Form ADV Part 1 within three months of a change in control or in
executive officers.C. File amendments to Form ADV Part 1 electronically via the IARD
system.
Q2
XYZ Investment Adviser has been found to have engaged in numerous prohibited activities.
Which THREE measures may the SEC impose? (Choose three.) Censure Suspension Revocation
of registration Criminal indictment
Answer: A. Censure B. Suspension D. Criminal indictment
Q3
Which THREE items must be included on an order memorandum as required by the Books and
Records Rule under the Investment Advisers Act of 1940? (Choose three.) Identification of
discretionary/non-discretionary authority. Name of the individual entering the order. Date the
order was entered with the broker. Name of the exchange involved.
Answer: A. Identification of discretionary/non-discretionary authority.B. Name of the
individual entering the order. C. Date the order was entered with the broker.
Q4
Which activity is NOT a retention requirement of the Books and Records Rule under the
Investment Advisers Act of 1940? All books and records must be maintained and preserved in
an easily accessible place for five years from the end of the fiscal year in which the record was
created. All records must be maintained for the first two years in an appropriate office of the
adviser. Duplicate copies of any electronic records must be maintained. Corporate records must
be maintained with the attorney of record.
Answer: D. Corporate records must be maintained with the attorney of record.
Q5
An investment adviser stopped
Answer: B. 2009
, Q6
It must maintain all worksheets
Answer: B. 2009
Q7
Which example is INSUFFICIENT to support a finding of fraud under the Investment Advisers Act
of 1940? Directing trades to a broker that refunds back a portion of client commissions to the
firm. Allocating trades to benefit those accounts paying the highest fees or the firm's
proprietary account. Paying an adviser's operating costs with funds received from a broker for
client reimbursements. Violating a client's sector guidelines due to capital appreciation in that
particular sector.
Answer: D. Violating a client's sector guidelines due to capital appreciation in that
particular sector.
Q8
Sam travels weekly from his Alabama office to Georgia to meet with clients at his vacation
home. Under the Investment Advisers Act of 1940, the vacation home would technically be
considered: A principal place of business. An office of supervisory jurisdiction. A place of
business. A convenient meeting place for his clients.
Answer: C. A place of business.
Q9
States have the authority to enforce which TWO of the following for SEC-registered advisers?
(Choose two.) Additional books and records requirements. Advisory notice filing. Errors and
omissions insurance. Investment Adviser Representative registrations.
Answer: B. Advisory notice filing. D. Investment Adviser Representative registrations.
Q10
In determining materiality for purposes of disclosing disciplinary information in Form ADV Part
2, all of the following are considered EXCEPT the: proximity of the person to the investment
function. nature of the infraction that lead to the disciplinary event. severity of the disciplinary
sanctions. degree of internal control weakness surrounding the event.
Answer: A. proximity of the person to the investment function.
Q11
An investment adviser manages
Answer: B. 3
