Loading…
SIDC PrepStudyingModule 6
Switch exam
Investment advice and corporate finance
Module 12Investment Management and Corporate FinanceThese are real Hard Mode questions from SIDC Prep: the long, multi-statement scenario questions that actually test how concepts combine in the SIDC Module 6 exam. Answers and worked explanations are shown. No sign-up needed — see the difficulty for yourself.
The Capital Market Compensation Fund covers 'relevant persons' under Part IV of the CMSA. A CMSL holder is a relevant person if it carries on each of the following businesses EXCEPT:
Why: Section 140 of the CMSA defines a relevant person for Part IV as a holder of a CMSL who carries on the business of dealing in securities, dealing in derivatives as an affiliate of the relevant derivatives exchange, or fund management. The Capital Market Compensation Fund Corporation, set up under s.141, manages the fund under s.142 and handles claims arising when a relevant person suffers an event of default. Advising on corporate finance is a regulated activity, but a CMSL holder carrying on only that business is not a relevant person, so its clients fall outside the fund. Source: CMSA 2007 ss.140, 141, 142 (as at October 2026).
A director approves an investment for a proper purpose and in good faith, with no personal interest, after reading the relevant reports and rationally believing it is in the company's best interest. The investment loses money. Has he breached his duty of care?
These are just a taste. Hard Mode has hundreds of exam-grade scenario questions, plus timed mock papers weighted toward the toughest questions — plus questions across every SIDC Module 6 syllabus topic.
Build a daily practice habit — a few exam-style questions a day, with worked answers. Free to start.
Start practising →Original study material mapped to the public SIDC Module 6 syllabus. Verify any figures and rules against the current SC and Bursa Malaysia publications before relying on them. Independent. Not affiliated with or endorsed by SIDC or the Securities Commission Malaysia.
Why: Section 213(2) of the Companies Act 2016 requires a director to exercise reasonable care, skill and diligence. Section 214(1) deems a director who makes a business judgment to meet that duty if he makes it for a proper purpose and in good faith, has no material personal interest, is informed to the extent he reasonably believes appropriate, and reasonably believes it is in the company's best interest. These facts meet all four conditions. There is no strict liability for losses, prior shareholder approval is not a condition, and the duty applies to every director. Source: Companies Act 2016 (Act 777) ss.213, 214 (as at October 2026).
Rimba Bhd agrees to buy a plot of land from an unrelated vendor. The highest percentage ratio is 20%. Does Chapter 10 of the Main Market LR require Rimba to have the land valued?
Why: Paragraph 10.04(1) requires a valuation where a transaction involves real estate (or a corporation owning real estate) and any percentage ratio is 25% or more for a transaction under Part D (acquisitions and disposals), or 5% or more for a related party transaction under Part E. Rimba's deal is with an unrelated vendor and the highest ratio is 20%, so no valuation is required under Chapter 10. The 5% trigger is for related party transactions only. RM500,000 is the de minimis level below which announcements are not required. The property-development rule in paragraph 10.04(2) concerns acquiring a company that owns real estate. Source: Bursa Malaysia Securities Main Market Listing Requirements (consolidated as at 9 July 2026) paras 10.04(1), 10.04(2), 10.06(3) (as at October 2026).
The aggregated net short position in an Approved Security reaches 52 million shares against 520 million outstanding. When will the resulting short-selling suspension be lifted?
Why: 52 million is 10% of 520 million. Under Directive 8-002 para 5.1(1)(b) and Trading Manual para 7.5.3, reaching the 10% aggregate net short threshold suspends RSS, IDSS and PSS (except ETF market makers' PSS of ETF units). Para 7.5.3(e) says the suspension is lifted only when the aggregated quantity falls below 10%, which can occur only on redelivery of borrowed Eligible Securities under SBL or ISSBNT; the Exchange announces the uplift. The one-day suspension belongs to the 3% daily gross threshold. Trading halts are a different mechanism. A price recovery does not reduce the net short position. Source: Rules of Bursa Malaysia Securities Rule 8.31; Directive No. 8-002 paras 5.1(1)(b), 5.2(2); Trading Manual para 7.5.3 (as at October 2026).
A client's account was closed in March 2018 and an STR on him was lodged in 2019. In October 2026 the status of the case is unknown. May the reporting institution now destroy his records?
Why: Paragraph 10.2(a) sets a minimum seven-year retention period from account closure for CDD records, which on its own would have ended in March 2025. Paragraph 10.3, however, requires records to be retained beyond that period if they relate to an STR lodged with the FIED, a transaction under investigation by a law enforcement agency, or a transaction subject to prosecution, until it is confirmed that the case is closed or the records are no longer required. Acknowledgement of the STR does not end the obligation, and there is no general rule requiring permanent retention. Source: SC Guidelines on Prevention of Money Laundering, Countering Financing of Terrorism, Countering Proliferation Financing and Targeted Financial Sanctions for Reporting Institutions in the Capital Market (SC-GL/AML-2014 (R3-2024), revised 13 June 2024) paras 10.2-10.3 (as at October 2026).
Which of the following statements about settlement with the Clearing House are correct? (i) Title to securities delivered under a Novated Contract does not pass until the Clearing House is paid (ii) Until paid, the Clearing House may use the delivered securities to limit its liability (iii) Financial settlement with the Clearing House is gross, trade by trade (iv) A transfer of unpaid securities out of the buyer's account passes good title to the recipient
Why: Clearing Rule 5.7(a) reserves title: until the Clearing House is satisfied that it has been paid in full, title to securities delivered under a Novated Contract does not pass. Rule 5.7(b) lets the Clearing House use or apply such securities to limit its liability, and says that if the participant transfers them before good payment, no title passes to the recipient, so (iv) is wrong. Rule 5.3(a) requires financial settlement on a net basis, pooling and offsetting each participant's money obligations into one final position, so (iii) is wrong. Source: Rules of Bursa Malaysia Securities Clearing Rules 5.3(a), 5.7 (as at October 2026).
A PO opens an account for an individual who neither comes to its office nor signs before an Acceptable Witness. Which of the following may it use for non face-to-face verification under Bursa's Directives? (i) Receiving and encashing his personal cheque for RM100, with name and signature matching the application (ii) A video conference with him (iii) Asking him to make a nominal payment from his own account with a licensed bank (iv) Accepting a copy of his identity card that he emails to the PO
Why: Paragraph 9.1(4) of Directive No. 5-001 lists methods of non face-to-face verification, of which the PO may use one or more: confirmation from an independent source; receiving and encashing a personal cheque of not less than RM100 whose name and signature match the application form; contact by video conference or a video recording; confirmation from a group entity that is a reporting institution; a nominal payment from, or to, the Client's account with a licensed bank or licensed Islamic bank; or another effective technology solution such as biometrics. So (i), (ii) and (iii) are permitted. An emailed copy of an identity card is not on the list and, on its own, verifies neither identity nor the authenticity of the application, so (iv) is wrong. Source: Directive No. 5-001 paras 9.1(2)(b), 9.1(4)-(5); Rules of Bursa Malaysia Securities Rule 5.15(1)(b) (as at October 2026).
In which of these cases may the SC revoke or suspend dealer's representative Gopal's CMSRL WITHOUT first giving him an opportunity to be heard? (i) He becomes an undischarged bankrupt (ii) He is convicted of an offence involving dishonesty (iii) He fails to pay his annual licence fee (iv) He stops acting as a representative
Why: Section 72(4) requires the SC to give a licensed person an opportunity to be heard before revoking or suspending a licence, subject to s.72(5). For a CMSRL holder, s.72(5)(b) allows revocation or suspension without a hearing where (i) he is an undischarged bankrupt or (ii) he has been convicted of an offence described in s.65(1)(g)(i) or (ii), which includes offences involving fraud or dishonesty. Failure to pay the fee and ceasing to act are grounds for revocation under s.72(2)(b), but the hearing requirement in s.72(4) still applies to them. Source: CMSA 2007 s.72(2)(b), (4), (5)(b) (as at October 2026).