ACI ACI Certifications 3I0-012 Questions & Answers

• Question 141:

  The Model Code recommends that, in the case or complaints about transactions, management should:

  A. Ensure complaints are investigated by the senior management or a firm not involved in the disputed transaction.

  B. Ensure complaints are rairly and independently investigated, in the first instance, by the ACIs Committee for Professionalism.

  C. Ensure complaints are investigated by representatives of a broking firm not directly involved in the disputed transaction and selected by both parties to the dispute.

  D. Ensure complaints are fairly and independently investigated, whenever practicable, by staff not directly involved in the disputed transaction.

  Correct Answer: D

• Question 142:

  It is now permissible in most markets for brokers to be owned by banks and other principals. Where there is shared management, or a share holding or other investment in a broker by a counterparty:

  A. The broker is not obligated to reveal the connection provided Chinese Walls are in place.

  B. The broker is not obligated to reveal the connection in the professional market.

  C. The broker should advise the other counterparty of the connection.

  D. The matter is covered in the Model Code.

  Correct Answer: C

• Question 143:

  If a dealer has any intention of assigning an interest rate swap to a third party soon after transacting that swap:

  A. The dealer should not reveal his future dealing intentions to his counterparty.

  B. The dealer should make his intention to assign clear before transacting.

  C. The dealer should agree the method of assignment before transacting.

  D. The counterparty should specify whether or not assignment would be acceptable in negotiations.

  Correct Answer: B

• Question 144:

  A broker offers a dealer an incentive in the form of a reduction to the agreed schedule of brokerage between the firms.

  A. This is a normal volume discount.

  B. The offer requires approval in writing by both senior managements.

  C. The offer requires agreement in writing between the broker and the dealer.

  D. This is illegal.

  Correct Answer: B

• Question 145:

  You deal over the phone with a counterparty. The subsequent confirmation differs from the terms agreed verbally. What is the result?

  A. The confirmation takes precedence as it is a written contract.

  B. The matter will have to be submitted to arbitration in order to establish the mutual intent of the parties.

  C. It depends on local law.

  D. The verbal agreement is binding.

  Correct Answer: D

• Question 146:

  Deliberately inputting incorrect big figures into an electronic dealing platform is:

  A. Technically impossible on electronic platforms

  B. Not an uncommon practice and something which professional dealers should be able to guard against.

  C. Not good practice.

  D. A criminal offence.

  Correct Answer: C

• Question 147:

  You are quoting forward FX prices to a broker subject to finding a counterparly for a matching transaction. The Model Code says:

  A. You must tell the broker, who must qualify your quotes.

  B. For credit reasons, you must tell the broker when he presents a name.

  C. You cannot do this.

  D. The Model Code does not make recommendations on this subject.

  Correct Answer: A

• Question 148:

  The Model Code rules that deals at non-current rates:

  A. Are forbidden.

  B. Require prior regulatory approval.

  C. Require the prior express permission of the senior management of both counterparties.

  D. Should be marked to market daily.

  Correct Answer: C

• Question 149:

  You quote a price to a broker on EUR 100 million. Your price is hit for EUR 50 million. What does the Model Code say about this situation?

  A. You have a right to qualify your quotes in terms of amounts, if you do so when you make the price.

  B. You have a right to qualify your quotes in terms of amounts, provided the amounts are marketable.

  C. You have a right to qualify your quotes in terms of amounts, once you have discovered the name of the counterparty for credit reasons.

  D. You have a right to qualify your quotes in terms of amounts.

  Correct Answer: A

• Question 150:

  Payment and settlement instructions should be passed:

  A. As quickly as possible.

  B. Within 24 hours of the transaction.

  C. Setore 10:00 am on the value date.

  D. Betore close of business on the transaction date.

  Correct Answer: A