General Securities Principal Exam (Series 24) Flashcards
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What score is required to pass the Series 24, and what does it cost?
A passing score of 70%; the exam fee is $235.
What prerequisite exam must you generally hold before the Series 24?
A qualifying representative-level exam — most commonly the SIE plus a representative exam such as the Series 7 (General Securities Representative).
What is the purpose of an annual compliance meeting and branch office inspections?
To review compliance with rules; each registered person must attend an annual compliance interview/meeting, and offices must be inspected on a risk-based schedule (OSJs at least annually).
What is an OSJ?
An Office of Supervisory Jurisdiction — a location where key supervisory or securities functions occur (e.g., order execution, approving new accounts, structuring offerings, supervising other offices). Each OSJ must have an on-site principal.
Who must approve the opening of a new customer account, and when?
A principal must approve each new account, generally promptly after the first transaction, evidenced in writing.
What is the difference between a firm-commitment and a best-efforts underwriting?
In a firm-commitment underwriting the underwriter buys the entire issue and assumes the risk of reselling it; in best-efforts the underwriter acts as agent and only sells what it can, with no purchase obligation.
Under Reg M, what does Rule 101 restrict?
It restricts distribution participants (underwriters, broker-dealers) from bidding for or purchasing the security being distributed during the applicable restricted period, to prevent manipulation.
When must a firm file a communication with FINRA, and who approves retail communications?
A registered principal must approve retail communications before use; certain communications (e.g., those concerning specified products) must be filed with FINRA's Advertising Regulation Department.
How many questions are on the Series 24 exam, and how long is it?
150 multiple-choice questions, with a time limit of 225 minutes (3 hours and 45 minutes).
What does the Series 24 (General Securities Principal) qualification allow?
It qualifies a person to supervise and manage a broker-dealer's investment banking and securities business, including supervision of associated persons in those activities.