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Chief Financial Officer Exam — Information & Free Practice

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About Chief Financial Officer Exam

Chief Financial Officer Exam · CA

Key exam facts

Format
Multiple choice: 60 standard and 30 item set
Exam questions
Total questions: 90.
Time limit
3 hours

Topics covered

  • General regulatory framework

    • Understand the role and authority of the CSA and provincial/territorial securities and derivatives regulators
    • Understand the role and authority of CIRO
    • Understand the role and authority of exchanges and other marketplaces
    • Understand the role of the Canadian Investor Protection Fund
    • Understand the function and purpose of other financial regulators and agencies
    • Understand the purpose of specified federal statutes
    • Remember the purpose of specified federal statutes

  • General financial requirements

    • Apply to specific situations the responsibilities of the CFO of an Investment Dealer
    • Apply best practice in preparing for and undertaking internal and regulatory financial examinations, investigations and enforcement
    • Understand the authority and purpose of the CIPF
    • Understand rules and procedures relating to the funding of the CIPF by Investment Dealers
    • Analyze accounting policies required of Investment Dealers

  • Investment Dealer business model and related areas

    • Analyze risks, opportunities and requirements associated with client types
    • Analyze risks, opportunities and requirements associated with business models
    • Analyze risks, opportunities and requirements associated with services
    • Analyze risks, opportunities and requirements associated with account types
    • Analyze risks, opportunities and requirements associated with basic types of securities
    • Analyze risks, opportunities and requirements associated with complex securities and products
    • Analyze risks, opportunities and requirements associated with types of derivatives
    • Analyze risks, opportunities and requirements associated with compensation structures
    • Analyze risks, opportunities and requirements associated with profitability measures
    • Understand requirements for development, evaluation and delivery of products and services
    • Understand product due diligence requirements and exemptions
    • Understand requirements for product due diligence policies and procedures

  • Offering and distribution of securities

    • Understand prospectus requirements under NI 41-101, NI 44-101 and provincial and territorial securities legislation
    • Understand selective disclosure relating to securities issuance
    • Understand commonly used prospectus exemptions under NI 45-106
    • Understand investor information and protections relating to issuance of securities
    • Analyze the rights and obligations of the Investment Dealer when underwriting securities issuers
    • Understand public-company continuous disclosure requirements
    • Understand public-company requirements relating to statutory shareholder rights
    • Remember additional common and civil law liabilities applicable to issuers

  • Capital adequacy, books and records, and reporting

    • Analyze capital adequacy reporting and risk-adjusted capital controls
    • Analyze financial risks faced by an Investment Dealer
    • Apply the Capital Formula to identify and quantify risk activities
    • Analyze risk-adjusted capital calculation and apply working knowledge of its results
    • Analyze CIRO requirements on the early warning system, tests and related requirements
    • Analyze CIRO requirements for reports, books and records and their impact on regulatory reporting
    • Apply financial and other reporting requirements, timing and filing methods to CFO situations
    • Apply the need to update policies and procedures when business activities or regulatory requirements change
    • Understand the need to notify the regulator of material changes
    • Understand regulatory requirements and disclosures for non-arms-length or related-party transactions affecting dealer risk
    • Apply investment-dealer insurance coverage requirements to CFO situations
    • Apply best practice in ensuring an appropriate Investment Dealer audit
    • Understand substantive audit procedures regarding the Investment Dealer financial position

  • Corporate governance and ethics

    • Analyze components of effective corporate governance
    • Understand the impact of corporate bylaws
    • Remember the relevance and impact of environmental, social and governance considerations
    • Analyze ethics and integrity in the securities industry for Directors and Executives including the CFO
    • Analyze ethics and integrity in corporate governance for Directors and Executives including the CFO
    • Analyze consequences and risks of unethical behaviour
    • Analyze CIRO requirements relating to conflicts of interest
    • Apply outside activity requirements to Directors and Executives including the CFO
    • Apply requirements relating to personal financial dealings with clients
    • Analyze requirements for containment of confidential and material non-public information

  • Duties, liabilities and defences

    • Analyze factors relating to strategic company objectives and positions
    • Analyze situations and obligations relating to Director or Executive duties
    • Analyze corporate Director or Executive fiduciary obligations
    • Analyze situations and potential legal liabilities
    • Remember securities-related criminal penalties
    • Understand limitation of liability
    • Understand legal defences available to officers and Directors

  • Risk management and internal controls

    • Understand the definition and objectives of risk management
    • Analyze risk management in a principles-based regulatory environment
    • Understand regulatory expectations of risk management
    • Understand the definition and objectives of internal controls
    • Analyze an Investment Dealer’s use of risk management frameworks
    • Apply Director or Executive actions to ensure appropriate independent risk management
    • Understand the role of the auditor and auditor reports in internal controls
    • Analyze risk in growth and value creation and risk management in preservation of value
    • Understand reporting requirements for legal actions against the Investment Dealer
    • Analyze risk identification, measurement, monitoring, control and reporting considerations
    • Analyze effectiveness of risk management tools
    • Understand requirements for credit risk management policies and procedures

  • Inventory, pricing of securities and underwriting

    • Understand principal trading activities and controls
    • Analyze inventory margin and offset rules and calculations
    • Apply oversight of approved Traders and trading desks
    • Apply considerations in assessing inventory margin errors
    • Apply oversight of policies, procedures and processes for pricing financial instruments
    • Apply minimum requirements for pricing securities
    • Apply assessment of red flags and indications of inadequate internal controls
    • Analyze syndicate accounting policies, procedures and processes
    • Analyze underwriting commitment margin rate policies, procedures and processes

  • Credit risk management and client accounts

    • Apply credit risk management best practices
    • Analyze types and classifications of credit risk
    • Apply margin rules, capital provisions and the use of margin accounts
    • Apply cash account rules and practices
    • Understand CIRO account guarantee requirements
    • Apply counterparty risk and margin requirements for AI, AC and RE
    • Apply requirements for specific written agreements
    • Apply oversight of identification, documentation and corrective measures for client accounts
    • Understand policies and procedures for registered account plans
    • Apply oversight of registered account operations

  • Significant areas of risk

    • Understand the definition of significant areas of risk
    • Apply requirements for managing significant areas of risk
    • Analyze significant risks specific to the Investment Dealer and its business lines
    • Analyze the impact of significant risks and ways to mitigate them

  • Operations and settlement

    • Understand rules, policies and roles of clearing agencies and depositories
    • Understand roles of foreign clearing and settlement agencies
    • Apply oversight of clearing and settlement
    • Apply oversight of specific back-office arrangements
    • Apply oversight of regulatory requirements and financial implications for outsourcing
    • Apply general knowledge for oversight of back-office procedures and activities
    • Apply oversight of financial implications relating to trading
    • Understand general requirements for stock record balancing
    • Apply oversight of procedures for addressing unresolved differences
    • Analyze techniques for managing liquidity needs and financing costs
    • Analyze Investment Dealer use of client free credits
    • Analyze financing arrangements including economics, collateral, controls, reporting and margin rules

  • Protection of dealer and client assets

    • Apply internal control standards for handling and custody of money and securities
    • Apply oversight of acceptable securities locations
    • Apply oversight of capital and early warning charges
    • Apply oversight of segregation of securities
    • Apply oversight of segregation problem indicators and corrective measures
    • Apply oversight of client free credit policies and disclosure controls
    • Apply minimum safekeeping requirements for client securities
    • Apply oversight of loss prevention policies and safeguarding controls

  • Other capital provisions

    • Apply oversight of securities concentration
    • Apply the importance of regulation, oversight and controls related to providers of capital
    • Understand dealer and liquidity provider roles in foreign exchange and exposure
    • Apply foreign exchange margin rules

  • Ultimate Designated Person (UDP) responsibilities

    • Analyze specific UDP responsibilities in dealer situations
    • Analyze UDP monitoring and supervision responsibilities
    • Analyze UDP oversight of Executives managing significant risks
    • Apply impact and risks associated with early warning rules
    • Understand UDP requirement to address issues raised by examination reports
    • Understand the purpose of annual risk questionnaires and risk trend reports

How to prepare

Work through the topics, read the explanation after each answer, and revisit the areas where you miss questions. Use the official outline and reference materials below to guide your study.

These independent practice questions are not actual exam items and do not guarantee a passing result.

Frequently asked questions

What is the exam format?

Multiple choice: 60 standard and 30 item set

How many questions are on the exam?

Total questions: 90.

How long is the exam?

3 hours

Official sources and references

Confirm current exam arrangements with the exam provider.