ACI-Dealing Certificate (2) Set 2

Currency Conversion Factor ✘ Credit Conversion Factor ✘ Credit Contribution Factor ✘ Credit Collateralization Factor ✔

the last calendar day of the month ✘ the last bank business day of the month ✘ value last business day of the month against first business day of the next month ✘ value first business day of the month against last business day of the same month ✔

know whether the European Central Bank or the Federal Reserve is in the market before quoting ✘ be sure that the quoting bank's prices are not shared with other brokers ✘ get the price from a bank or a bid and an offer from different banks in order to make a two-way price, because the broker cannot make prices on his own ✘ make sure that the quoting banks have sufficient credit lines ✔

no transaction should be concluded and the broker should inform both counterparties accordingly ✘ a transaction should be concluded and the broker should inform both counterparties accordingly ✘ the dealer has the choice of either concluding the transaction or not ✘ the broker decides whether the transaction should be concluded or not ✔

agree, since entertainment is a normal part of business ✘ refer this to senior management ✘ agree but insist on paying half the cost ✘ agree, if the broker pays for the event but does not attend it ✔

Management should monitor the form, frequency and cost of entertainment and gifts dealers receive, have a clearly articulated policy towards the giving/receipt

of gifts and ensure the policy is enforced. ✘ As gifts and entertainment may be offered in the normal course of business, employees can offer inducements to conduct business and solicit them from thepersonnel of other institutions. ✘ Although management should not monitor the form, frequency or cost of entertainment/gifts dealers receive, they may have a policy towards the giving/receipt ofgifts and ensure the policy is enforced. ✘ Gifts or entertainment should never be offered in the normal course of business, and employees must never offer any inducements to conduct business, norsolicit them from other institutions. ✔

to promote globalization and deregulation of the financial markets ✘ to maintain the professional level of competence and to disseminate a high level of ethical and professional behavior ✘ to act as the official international market regulator in the absence of government regulation ✘ to become the sole global corporation of wholesale financial market professionals ✔

They must remain neutral and stay out of disputes between their customers. ✘ They must rely on the execution venue to resolve disputes. ✘ They must delegate the resolution of broken trades downstream to their clients. ✘ They must take responsibility for the swift resolution of any disputes. ✔

it need not be confirmed between the counterparties as the broker confirms it immediately with both counterparties ✘ it should also be confirmed directly between the two counterparties ✘ it is important to note that broker confirmations are bilateral confirmations between the principals of the trade ✘ the dealer should obtain acknowledgement that the deal has been agreed to but may assume agreement to the trade in the absence of such acknowledgement ✔

You must be prepared to deal EUR 50,000,000.00. ✘ You may quote without stating the amount you are prepared to deal. ✘ You are only committed to deal in a marketable amount. ✘ You must be prepared to deal for more than EUR 50,000,000.00 in case Bank XYZ wishes to. ✔