Securities lending refers to the practice of temporarily transferring securities to a borrower with the intent that the lender will buy them back at a future date. The borrower is required to return the securities to the lender, either on demand or at a specified time. A major reason for securities lending is:
Answer(s): B
Auditors should be aware of the following control and monitoring activities typically associated with securities lending EXCEPT:
Answer(s): D
Which of the following activity/ies should be considered by the auditors whenever reviewing situations where broker-dealer finance proprietary or customer activity through collateralized bank loans?
Answer(s): A,B
Reviewing counterparties for creditworthiness and obtaining master trade agreements and credit approval for counterparties before entering into a repurchase or reverse repurchase agreement Obtaining collateral from the counterparty Marking to market all collateral daily; if a deficit (within established guidelines) exists, additional collateral may be obtained from the counterparty Reconciling the repurchase and reverse repurchase subsidiary ledgers to the stock record and general ledger daily. Out-of-balances are recorded as suspense items and researched immediately These are actually:
Answer(s): A
"A valid contract involves each party giving something of value. This exchange of value, or consideration, may take the form of money, action, or promise. For insurance contracts, the insured's consideration is the payment or premiums and a promise to fulfill the conditions of the contracts, and the insurer's consideration is the promise to pay after a loss occurs." This is related to an element in an insurance policy contract. It is known as:
Post your Comments and Discuss Financial CFSA exam prep with other Community members:
Our website is free, but we have to fight against AI bots and content theft. We're sorry for the inconvenience caused by these security measures. You can access the rest of the CFSA content, but please register or login to continue.