[2026] UAE-Financial-Rules-and-Regulations Exam Dumps, Test Engine Practice Test Questions

Pass UAE-Financial-Rules-and-Regulations exam [Jan 24, 2026] Updated 102 Questions

NEW QUESTION # 47
The last trading day for an India Gold Quanto Futures contract is:

• A. one business day prior to the last business day of the delivery month
• B. the 25th calendar day of the delivery month
• C. four business days prior to the 25th calendar day of the delivery month
• D. two business days prior to the last business day of the delivery month

Answer: D

Explanation:
For India Gold Quanto Futures contracts, the last trading day is defined as two business days prior to the last business day of the delivery month. This rule ensures that there is adequate time for the settlement and adjustment of any open positions before the final day of trading. The two-day buffer also allows for the reconciliation of positions, making the futures market more efficient and reducing the likelihood of disputes regarding settlement. This is in line with global standards for futures contracts where the settlement and final trading days are clearly defined to protect market integrity and investor interests.
Reference: CISI UAE Financial Rules and Regulations - Futures Contract Trading, Section 8.2.4 (2023).

NEW QUESTION # 48
To qualify as a big block deal on the ADX's E-Trading system, the securities to be traded must be a minimum of what proportion of the issuer's capital?

• A. 2.5%
• B. 1.0%
• C. 2.0%
• D. 0.5%

Answer: B

Explanation:
A big block deal on the ADX's E-Trading system must involve securities that are at least 1.0% of the issuer's capital. This threshold ensures that large transactions, which could significantly affect the stock's market price, are categorized appropriately as big block deals. The rule helps to distinguish between regular trades and larger institutional trades, which often have different liquidity and market impact considerations. This also provides transparency for market participants regarding the size and nature of the transaction.
Reference: CISI UAE Financial Rules and Regulations - Big Block Deal Requirements on ADX, Section
6.1.2 (2023).

NEW QUESTION # 49
If the mid-point is used to determine the theoretical auction price for a pre-closing session of the DFM, it is:

• A. rounded to one decimal place
• B. rounded to two decimal places
• C. rounded down to the nearest price tick
• D. rounded up to the nearest price tick

Answer: D

Explanation:
The Dubai Financial Market (DFM) utilizes precise rules to calculate the theoretical auction price during pre- closing sessions to ensure market transparency and fairness. According to the CISI UAE Financial Rules and Regulations and DFM official trading manuals, when the mid-point price is used in price determination, it is roundedupto the nearest price tick. This rounding mechanism ensures consistency in pricing and avoids fractional pricing issues that could disrupt the matchingof buy and sell orders. The concept of a price tick is a minimum price movement allowed in trading, defined by the market's tick size schedule. By rounding up, the market supports price stability and protects sellers during the auction process. This is explicitly stated in DFM' s trading rules section regarding auction price calculation and tick size adjustments.
Reference:CISI UAE Financial Rules and Regulations - Dubai Financial Market Rules, Auction Price Determination, Section 5.2.3 (2023).

NEW QUESTION # 50
The disclosure of a licensed body's legal status, including the fact that it is licensed by the Authority, is important because:

• A. it forces firms to disclose their regulatory status and that they are subject to the Authority's control and supervision
• B. it enables those that might suffer from perceived or actual misbehaviour at the hands of a firm to raise their concerns with the regulator
• C. it ensures that no clients suffer from perceived or actual misbehaviour at the hands of a firm which is regulated
• D. it allows third party firms to use, utilise, or copy the Authority's logo for any reason and this reassures clients

Answer: B

Explanation:
Disclosing a licensed body's legal status and its licensing by the Authority is crucial because it enables clients and others who may suffer from perceived or actual misbehaviour to raise their concerns with the regulator.
This transparency mechanism empowers investors and market participants to seek redress and promotes regulatory oversight. While the disclosure also signifies the firm's subjection to regulatory supervision, the primary benefit is facilitating complaint handling and protection. It does not imply that no misbehaviour occurs, nor does it authorize the unauthorised use of the Authority's branding by third parties.
Reference: CISI UAE Financial Rules and Regulations - Client Protection and Regulatory Disclosure, Section 4.1.8 (2023).

NEW QUESTION # 51
Where an applicant for a financial activities licence uses a cloud-based server, they must set out provisions to ensure the outsourced party can operate with zero data loss for what stated period?

• A. Five years
• B. Seven years
• C. Ten years
• D. Three years

Answer: A

Explanation:
According to CISI UAE Financial Rules and Regulations, applicants utilizing cloud-based servers must demonstrate that their outsourced service providers have provisions in place to guarantee zero data loss for a minimum of five years. This requirement protects the integrity and availability of critical financial data over the regulatory retention period. The five-year timeframe aligns with data retention standards for audit, compliance, and operational continuity in the UAE financial sector, ensuring that regulatory bodies and firms can access historical information for supervisory purposes.
Reference: CISI UAE Financial Rules and Regulations - IT and Data Management Requirements, Section
3.5.7 (2023).

NEW QUESTION # 52
The role of the authorised agent of the exchange-traded fund (ETF) is to:

• A. ensure that the transfer of ownership of units is completed
• B. regularly announce the indicative value of the net value of assets
• C. announce the net value of the unit's assets on a daily basis
• D. update sell and buy orders

Answer: B

Explanation:
The authorised agent of an ETF has a critical role in maintaining transparency and liquidity in the market.
According to CISI UAE Financial Rules and Regulations, the authorised agent is responsible for regularly announcing the indicative value of the net assets of the ETF units. This indicative net asset value (iNAV) provides investors and market participants with a near real-time estimate of the underlying assets' value, reflecting market fluctuations throughout the trading day. Unlike the official net asset value (NAV), which is typically calculated at the end of the trading day, the iNAV supports intra-day trading decisions and helps maintain price alignment between the ETF units and their underlying assets. This responsibility is fundamental in ensuring efficient price discovery and protecting investor interests in the ETF market.
Reference: CISI UAE Financial Rules and Regulations - Investment Funds and ETF Operations, Section
6.4.2 (2023).

NEW QUESTION # 53
Why might employees in one part of a regulated business be permitted to withhold information from employees in another part of the business?

• A. Prevention of insider trading
• B. To comply with a Chinese wall
• C. Strict privacy of client information
• D. At the request of the audit function

Answer: B

Explanation:
CISI UAE Financial Rules and Regulations recognize the concept of a Chinese wall, which permits employees in one part of a regulated business to withhold certain information from employees in other parts.
This internal information barrier is designed to prevent conflicts of interest and insider trading by restricting the flow of sensitive or non-public information between departments. By implementing Chinese walls, firms ensure compliance with legal and regulatory requirements, uphold market integrity, and protect client interests. While audit requests and privacy concerns are valid, the primary regulatory rationale for withholding information internally is to maintain effective Chinese walls.
Reference: CISI UAE Financial Rules and Regulations - Regulatory Infrastructure and Information Barriers, Section 3.4.10 (2023).

NEW QUESTION # 54
A licensed person who conducts financial activities related to security tokens is required to carry out a suitability check only if:

• A. the client is not a qualified investor
• B. the licensed person has less than 3 years' relevant experience
• C. the token falls into the high risk category
• D. the amount being invested exceeds AED 100,000

Answer: A

Explanation:
According to CISI UAE Financial Rules and Regulations, a licensed person dealing with security tokens must conduct a suitability check when the client is not a qualified investor. This requirement protects less sophisticated investors by ensuring that the financial products offered match their investment knowledge, risk tolerance, and financial circumstances. Qualified investors are presumed to have sufficient expertise and resources, thus not mandating suitability checks. The nature of the token or amount invested is not the primary trigger; rather, client qualification status governs the obligation to perform suitability assessments.
This aligns with investor protection principles embedded in UAE financial regulations.
Reference: CISI UAE Financial Rules and Regulations - Client Protection and Suitability Checks, Section
4.3.9 (2023).

NEW QUESTION # 55
When collecting data from official authorities, evaluators of investment fund in-kind shares are required to abide by the principles of honesty, justice and:

• A. equality
• B. confidentiality
• C. governance
• D. prudence

Answer: B

Explanation:
Evaluators of in-kind shares for investment funds must adhere to key ethical principles including honesty, justice, and confidentiality when collecting data from official authorities. Confidentiality ensures sensitive information obtained during valuation processes is protected against unauthorized disclosure, preserving trust and compliance with legal requirements. This principle complements honesty and justice by maintaining the integrity of the evaluation process and protecting the interests of the fund and its investors. Governance, equality, and prudence are important but not the specifically mandated principles in this context.
Reference: CISI UAE Financial Rules and Regulations - Investment Funds Valuation and Ethical Standards, Section 6.2.9 (2023).

NEW QUESTION # 56
When licence applicants submit behaviour regulations including a professional code of ethics, this falls under the category of:

• A. technical system
• B. administration regulation
• C. governance regulation
• D. employee regulation

Answer: C

Explanation:
Behaviour regulations submitted by license applicants, such as a professional code of ethics, are classified undergovernance regulationswithin the CISI UAE Financial Rules and Regulations framework. Governance regulations encompass policies, standards, and codes that guide the ethical conduct, integrity, and responsibilities of licensed entities and their employees. They are designed to promote accountability, compliance, and good corporate citizenship within the financial industry. Unlike technical systems, which relate to operational infrastructure, or employee regulations focused on HR and workplace rules, governance regulations provide the overarching ethical and procedural guidelines essential for sustaining market confidence and protecting stakeholders. The inclusion of a professional code of ethics ensures license applicants demonstrate commitment to the principles of fairness, transparency, and fiduciary duty, which are fundamental requirements by the Securities and Commodities Authority (SCA) for licensing approval.
Reference:CISI UAE Financial Rules and Regulations - Regulatory Infrastructure and Governance, Section
3.1.4 (2023).

NEW QUESTION # 57
If an offering person arranges the issuance of crypto assets for which funds have been subscribed by investors, controls must be set up to avoid:

• A. prices being determined at the discretion of the issuer
• B. subscriptions being taken at different threshold levels
• C. subscriptions being taken at excessive levels from non-qualified investors
• D. prices being allowed to fluctuate during the opening offer period

Answer: C

Explanation:
Under Federal Law No. 20 of 2018 and related CISI UAE Financial Rules and Regulations, issuers arranging crypto asset offerings must establish controls to prevent subscriptions being taken at excessive levels from non-qualified investors. This is a key investor protection and anti-money laundering measure designed to restrict high-risk investment exposure to those with adequate knowledge, resources, and risk appetite. By enforcing subscription limits for non-qualified investors, the regulations mitigate fraud, market manipulation, and financial losses while ensuring regulatory compliance. Controls over pricing discretion or fluctuations, while relevant, are not the central regulatory concern in this context.
Reference: CISI UAE Financial Rules and Regulations - AML and Crypto Asset Issuance Controls, Section
8.2.4 (2023).

NEW QUESTION # 58
Establishing a local investment fund requires the approval of the Authority, for a public fund this will either be granted or rejected within:

• A. 5 working days
• B. 10 working days
• C. 20 working days
• D. 30 working days

Answer: C

Explanation:
According to the CISI UAE Financial Rules and Regulations, the process for establishing a local investment fund, including a public fund, involves obtaining approval from the relevant regulatory authority, which is usually the Securities and Commodities Authority (SCA). For public funds, the authority is required to either grant or reject the application within 20 working days from the submission date. This time frame ensures that there is adequate time for the Authority to review the application, conduct necessary evaluations, and ensure that the fund complies with all regulatory and legal requirements. The 20-working-day period ensures efficiency while allowing for a thorough review.
Reference: CISI UAE Financial Rules and Regulations - Investment Fund Establishment Process, Section
6.2.1 (2023).

NEW QUESTION # 59
Following a public subscription, what must a Special Purpose Acquisition Company do with the proceeds?

• A. Deposit not less than 90% of the public subscription proceeds within two business days of receipt
• B. Deposit not less than 90% of the public subscription proceeds within one business day of receipt
• C. Deposit not less than 100% of the public subscription proceeds within two business days of receipt
• D. Deposit not less than 100% of the public subscription proceeds within one business day of receipt

Answer: D

Explanation:
Special Purpose Acquisition Companies (SPACs) operating under UAE financial regulations must safeguard investors' funds post-public subscription. According to the CISI UAE Financial Rules and Regulations, SPACs are required to deposit100% of the public subscription proceeds within one business day of receipt into an escrow or segregated account. This requirement ensures that the funds are secured and managed transparently while awaiting acquisition activities. The strict one-business-day deadline prevents misuse or misallocation of investor money and aligns with international best practices for fund protection. This is critical in maintaining market confidence and regulatory compliance, as SPACs act as investment vehicles with inherent risk related to future mergers or acquisitions.
Reference:CISI UAE Financial Rules and Regulations - Investment Funds and SPAC Requirements, Section 6.3.1 (2023).

NEW QUESTION # 60
In cases where securities are bought and sold during the same trading session, the client must have in its cash account enough:

• A. credit to cover the value of purchase
• B. credit to cover the value of any losses
• C. credit to cover the value of sale
• D. securities to the value of purchase

Answer: A

Explanation:
According to the CISI UAE Financial Rules and Regulations under Client Protection provisions, when a client buys and sells securities within the same trading session (day trading), the client must maintain sufficient credit to cover the value of purchase in their cash account at the time of the transaction. This rule ensures that clients have the necessary funds to settle their purchase obligations promptly, reducing settlement risk and maintaining market stability. Credit to cover sales is not required since sales generate funds rather than consume them. This provision supports orderly trading and financial discipline among market participants by preventing unsettled trades and possible defaults.
Reference: CISI UAE Financial Rules and Regulations - Client Protection, Trading and Settlement Rules, Section 4.3.2 (2023).

NEW QUESTION # 61
If the perpetrator of a money laundering crime is a repeat offender, what impact does this have on the minimum fine compared to a first offence?

• A. It is quadrupled
• B. It is doubled
• C. It is tripled
• D. It is increased by 50%

Answer: B

Explanation:
Under Federal Law No. 20 of 2018 and CISI UAE Financial Rules and Regulations, if a person convicted of a money laundering offence is a repeat offender, the minimum fine imposed is doubled compared to the first offence. This increased penalty reflects the heightened regulatory and punitive response to repeated non- compliance, emphasizing deterrence and the protection of the financial system. Repeat offenders face more severe consequences to underscore the seriousness of continued illegal activity and to promote adherence to AML laws.
Reference: CISI UAE Financial Rules and Regulations - AML Penalties and Repeat Offences, Section 8.4.6 (2023).

NEW QUESTION # 62
An in-kind shares evaluation report must be based on data covering what maximum period before the evaluation date?

• A. One month
• B. Two months
• C. Four months
• D. Three months

Answer: D

Explanation:
Under CISI UAE Financial Rules and Regulations, an in-kind shares evaluation report must be based on data covering a maximum period of three months prior to the evaluation date. This ensures the valuation reflects recent market conditions and financial information, maintaining accuracy and relevance. Longer periods could risk outdated or misleading valuations, affecting investor decisions and fund reporting. The three-month timeframe is aligned with international valuation standards applied to in-kind contributions to investment funds.
Reference: CISI UAE Financial Rules and Regulations - Investment Funds, In-Kind Share Valuation Requirements, Section 6.2.8 (2023).

NEW QUESTION # 63
If a discrepancy comes to light when conducting an external reconciliation, what must the firm do?

• A. Immediately suspend operations with the third party
• B. Close the client's account by close of business on the same day
• C. Immediately inform the regulator verbally and follow this up in writing
• D. Investigate and correct it as soon as possible

Answer: D

Explanation:
If a discrepancy is identified during an external reconciliation process, the firm is required to investigate and correct it as soon as possible. The CISI UAE Financial Rules and Regulations emphasize that discrepancies, whether in financial data or operational procedures, must be thoroughly examined to determine the root cause and rectified promptly. Immediate corrective action helps to ensure that financial statements and other reports remain accurate and reliable, preventing any further errors or compliance issues. While it may be necessary to inform the regulator or suspend operations in extreme cases, the first priority is to address the discrepancy through investigation and correction.
Reference: CISI UAE Financial Rules and Regulations - Reconciliation and Error Resolution, Section 8.1.4 (2023).

NEW QUESTION # 64
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