Investment Advisor SEC Registration and Regulatory Compliance 2

Question 1

What is the primary purpose of the Investment Advisers Act of 1940?

Accepted Answer

To regulate the activities of investment advisers and protect advisory clients

Answer

To regulate mutual fund expenses

Answer

To establish capital requirements for banks

Answer

To govern securities trading on exchanges

Question 2

Under SEC rules, investment advisers must maintain client records for a minimum of how many years?

Accepted Answer

5 years

Answer

3 years

Answer

7 years

Answer

10 years

Question 3

Which SEC rule requires investment advisers to adopt written compliance policies and procedures?

Accepted Answer

Rule 206(4)-7

Answer

Rule 205-3

Answer

Rule 203A-1

Answer

Rule 204-2

Question 4

An investment adviser must deliver their Form ADV brochure to a prospective client no later than:

Accepted Answer

At the time of or before entering into an advisory contract

Answer

30 days after the advisory contract is signed

Answer

60 days before the contract is signed

Answer

Only upon client request

Question 5

Under the Dodd-Frank Act, family offices are excluded from the definition of investment adviser if they:

Accepted Answer

Advise only family members and have no public clients

Answer

Manage less than $100 million

Answer

Are registered as broker-dealers

Answer

File Form 13F with the SEC

Question 6

Which of the following is considered an 'investment adviser' under the Investment Advisers Act of 1940?

Accepted Answer

A firm that manages client portfolios for a fee

Answer

A newspaper financial columnist

Answer

A bank providing trust services only

Answer

A licensed attorney giving incidental investment advice