Innovation & Change Management Flashcards

A new CFTC rule takes effect that changes recordkeeping duties for an FCM. What is the most appropriate first internal step?

Answer: Update written procedures and train affected staff

Compliance requires revising procedures and training personnel to meet the new rule.

NFA Compliance Rule 2-9 requires members to do what?

Answer: Diligently supervise employees and agents

Rule 2-9 imposes a supervisory duty over employees and agents' commodity activities.

Before opening a speculative futures account, an FCM or IB must generally provide the customer with what?

Answer: A risk disclosure statement and obtain a signed acknowledgment

CFTC Regulation 1.55 requires a risk disclosure document with a signed acknowledgment.

Under CFTC Regulation 1.31, how long must most required records generally be kept?

Answer: Five years

Records must generally be kept five years and be readily accessible during the first two years.

A firm plans to deploy new order-routing software. Which practice best manages change risk?

Answer: Test in a non-production environment and document approval before go-live

Controlled testing and documented approval limit operational and compliance risk.

An introducing broker's main business address changes. Which body must be updated through its registration system?

Answer: The NFA

Registrants keep registration information current with the NFA's online registration system.

When a firm materially changes its fee schedule, what is the best practice toward existing customers?

Answer: Provide clear advance written notice

Fair dealing and disclosure principles call for clear advance notice of material changes.