Practice Test Geeks(CIRO) Certified Investor Relations Officer Practice Test
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Regulatory Compliance & Governance Flashcards

7 cards from real CIRO practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Regulatory Compliance & Governance flashcards as text

  1. A company's insider trading policy typically establishes 'blackout periods' primarily around which events?

    Answer: Earnings announcements and other predictable material disclosure events

    Blackout periods are imposed around earnings releases and other foreseeable material events to prevent trading while insiders possess MNPI.

  2. A 10b5-1 trading plan allows insiders to trade company securities while aware of MNPI, provided the plan is:

    Answer: Established in good faith when the insider is not aware of MNPI and specifies amount, price, and timing in advance

    A valid 10b5-1 plan must be adopted when the insider lacks MNPI and must specify trade parameters or delegate discretion to a third party without future influence.

  3. Under the Sarbanes-Oxley Act Section 906, the penalties for a CEO or CFO who knowingly certifies a false financial report include:

    Answer: Criminal fines up to $5 million and imprisonment up to 20 years

    SOX Section 906 imposes criminal penalties of up to $5 million in fines and 20 years in prison for knowingly certifying false financial statements.

  4. An IR officer is preparing the company's annual meeting proxy statement. The record date for determining which shareholders may vote is set by:

    Answer: The company's board of directors, typically 10 to 60 days before the meeting

    Under state corporate law and SEC rules, the board sets the record date, which must fall between 10 and 60 days before the shareholder meeting.

  5. The concept of 'materiality' in securities law is most accurately defined as information that:

    Answer: A reasonable investor would consider important in making an investment decision

    The Supreme Court's 'reasonable investor' standard defines material information as information that a reasonable investor would consider significant when making investment decisions.

  6. When a company announces a merger, Rule 14a-9 under the Securities Exchange Act prohibits:

    Answer: Making false or misleading statements or omitting material facts in proxy solicitation materials

    Rule 14a-9 prohibits materially false or misleading statements or material omissions in any proxy solicitation materials, including merger proxies.

  7. A company discovers it must file a restatement due to a revenue recognition error. Which disclosure obligation is triggered FIRST?

    Answer: Filing a Form 8-K disclosing that previously issued financial statements should no longer be relied upon

    SEC guidance requires companies to file a Form 8-K (Item 4.02) promptly when the board or management concludes that prior financials are no longer reliable.