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What will you learn about?

  • The CIPF minimum standards, capital formulas, audit requirements
  • Inventory, insurance, and segregation
  • Introducing and carrying arrangements, related companies, and cross-guarantees
  • Customer accounts and registered account plans
  • Risk Management and the capital formula
  • Accounting standards and audit requirements
  • Custody, settlement, and stock record balancing
  • Securities concentration, segregation, and safe keeping
  • Foreign exchange
  • Underwriting capital rules
  • Provider of capital concentration
  • Requirements to complete IIROC Form 1

How will you learn?

CSI’s online learning system helps you meet your study goals. You’ll benefit from:

  • Learning objectives that keep you focused
  • Textbook readings available in PDF, eBook, and printed format
  • Online post-chapter review questions to assess your progress
  • Course updates to ensure you’re learning the most current and up-to-date practical material in your studies
  • Assistance from CSI’s academic support specialists

What is the course syllabus?

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Chapter 1 - Canadian Investor Protection Fund

Topics covered in this chapter are:

  • Overview of the Canadian Investor Protection Fund
  • Funding
  • Protection Provided to Customers

Chapter 2 - IIROC Prudential Rules

Topics covered in this chapter are:

  • Books and Records
  • Capital Formula
  • Internal Controls
  • Insurance Coverage Requirements
  • Client Documentation and Settlement
  • Financial Reporting and Examination

Chapter 3 - Capital Formula

Topics covered in this chapter are:

  • Ensuring Liquidity
  • Additional Financial Risks
  • Insurance Against “Other Losses”
  • The Uniform Capital Formula
  • The Early Warning System
  • Parameters and Sanctions
  • Free Credit Segregation Limit (Statement D)
  • Capital Reporting Requirements
  • Failure to Maintain Adequate Risk Adjusted Capital

Chapter 4 - Risk Management

Topics covered in this chapter are:

  • Risk Management in the Securities Industry
  • IIROC Risk Trend Report (RTR)
  • IIROC Financial & Operations (FinOps) Compliance Risk Model
  • Maintaining an Effective Compliance Regime
  • Reporting of Changes to Business Models

Chapter 5 - Accounting Standards - IFRS

Topics covered in this chapter are:

  • Summary of Accounting Departures from IFRS
  • Balance Sheet Implications

Chapter 6 - Audit Requirements

Topics covered in this chapter are:

  • Substantive Audit Approach
  • Amendments to Audit Instructions
  • Adoption of Canadian Auditing Standards (CAS)
  • Special compliance report on insurance, segregation and guarantee arrangements
  • Common Audit Deficiencies

Chapter 7 - Related and Affiliated Companies and Cross-Guarantees

Topics covered in this chapter are:

  • Non-Arms Length Transactions
  • Rule Amendments
  • Limited Guarantees
  • Consolidated Financial Reporting of Related Companies
  • Financial Assistance
  • Changes in Ownership or Share Capital of Dealer Members and Holding Companies
  • Diversification – Distribution of Insurance Products
  • Principal/Agent Relationships

Chapter 8 - Bank Balances

Topics covered in this chapter are:

  • Indications That the Banking System Is Inadequate
  • Considerations in Assessing Possible Errors in the Risk Adjusted Capital Calculation

Chapter 9 - Inventory

Topics covered in this chapter are:

  • Financing and Security Margin Rates
  • Debt And Equity Margin Rates
  • Short “Squeeze”
  • Equity Margin Offset Rules
  • Debt Margin Offsets
  • Bond Margin Surcharge
  • Reduced Margin for Listed Equities
  • Unlisted Securities Acceptable for Margin Purposes
  • Pricing and Valuations
  • Rule 2600 – Pricing of Securities
  • Pricing of Securities
  • Control Objectives
  • Minimum Required Firm Policies and Procedures
  • Indications That Internal Control is Not Adequate
  • Case Study – Internal Controls and the Rogue Trader
  • Regulatory Approach
  • Considerations in Assessing Inventory Margin Errors

Chapter 10 - Insurance

Topics covered in this chapter are:

  • Insurance Formula
  • Full Re-instatement or Double Aggregate
  • Prescribed Minimum Insurance Clauses
  • Insurance Deficiency
  • Coverage on Amalgamation
  • Maximum Insurance
  • Global Policies
  • Excess CIPF Insurance
  • Rule 4400 part C
  • FAQ – Insurance
  • Regulatory Approach
  • Indicators of Possible Errors in Insurance Calculation

Chapter 11 - Introducing and Carrying Arrangements

Topics covered in this chapter are:

  • Introducing Broker/Carrying Broker Rules
  • Prescribed Contractual Agreements
  • Summary of Salient Features
  • Activity Matrix for Identifying Introducing/Carrying Broker Types
  • Frequently Asked Questions (FAQ)

Chapter 12 - Customer Accounts

Topics covered in this chapter are:

  • Credit Risk Management
  • Margin Accounts
  • Cash Account Settlement Practices
  • Cash Account Rule Amendments
  • Cash Account Rule
  • Counterparty Categorization and Related Margin Rules
  • Acceptable Institutions (AIs)
  • Account Guarantees
  • Recognition of Contingent Loss arising from Litigation
  • Regulatory Approach
  • Indications of Poor Credit Controls
  • Indications of Possible Errors in Customer Margin Requirements
  • Regulatory Approach
  • Indications of Poor Credit Controls
  • Indications of Possible Errors in Customer Margin Requirements

Chapter 13 - Registered Account Plans

Topics covered in this chapter are:

  • Trust Arrangements
  • Proposed National Instrument 33-101
  • RRSP Segregation
  • RRSP Cash Accounts
  • Introducing Broker Arrangements
  • Regulatory Approach
  • Considerations in Assessing RRSP Systems

Chapter 14 - Financing

Topics covered in this chapter are:

  • Financing Costs
  • Cash and Securities Loans
  • Call Loans
  • Repos/Reverse Repos
  • Financing Case Examples
  • Illustration of Financing Activity and Accounting Records
  • Financing: Income Tax Considerations
  • Regulatory Approach
  • Considerations in Assessing Risk Adjusted Capital Errors for Financing

Chapter 15 - Custody, Settlement and Stock Record Balancing

Topics covered in this chapter are:

  • Reconciliation of Books and Records
  • Back-Office Relationship to Financial Capital Rules
  • Stock Record Balancing
  • Unresolved Differences
  • Acceptable Securities Locations and Custody Agreements
  • Clearing Organizations and Settlements
  • Clearing House Deposits
  • Euroclear and Clearstream
  • Margin on Unsettled Clearing/Broker Trading Balances
  • Recording of CDS (Clearing) Trades
  • Back-Office Internal Controls
  • Outsourcing Arrangements
  • Regulatory Approach
  • Indicators of Weak Internal Controls
  • Indicators of Possible Errors in Financial Presentation
  • Indicators of Possible Errors in Broker Margin Requirements

Chapter 16 - Segregation

Topics covered in this chapter are:

  • Registration of Securities
  • Securities Held in Safekeeping
  • Bulk Segregation
  • Illustration of Stock Record Accounts
  • Book-Based System
  • Bulk Segregation Calculation
  • Detailed Segregation Examples
  • Corrective Action for Segregation Deficiencies
  • IIROC Segregation Rule References
  • Priority for Segregation and Desegregation
  • Self-Directed Registered Savings Plan Accounts
  • Securities in Transfer
  • Implications in Using House Margin Rates
  • Implications for Short Sales
  • Internal Control Standards
  • Effect of New Bankruptcy Rules
  • Audit Requirements
  • Auditing Introducing/Carrying Broker Relationships
  • Regulatory Approach
  • Indicators of Possible Problems with the Segregation System

Chapter 17 - Securities Concentration

Topics covered in this chapter are:

  • Concentration Rule
  • Introducing/Carrying Broker Issues
  • Regulatory Approach
  • Indications of Possible Errors in Concentration Calculation

Chapter 18 - Foreign Exchange

Topics covered in this chapter are:

  • Foreign Exchange Markets
  • Foreign Exchange Risks
  • Foreign Exchange Margin Rules
  • Currency Groups
  • Spot and Term Risks
  • Margin Surcharge Mechanism
  • Concentration
  • Client Margin

Chapter 19 - Underwriting Capital Rules

Topics covered in this chapter are:

  • Time Chart
  • Reduction in Normal New Issue Margin Rates
  • Expressions of Interest
  • Standard Form New Issue Letters (SFNIL)
  • Margin Reduction Permitted for Out Clauses in Underwriting Agreements
  • Applicability of Out Clauses
  • Summary Margin Requirements
  • Non-Lead Members of the Underwriting Syndicate
  • Definition of Underwriting Commitment
  • Formalization of Capital Rental Arrangements between Dealer Members
  • Mark-to-Market Provisions for Underwriting
  • Underwriting Commitment Concentration
  • Determining Unsold Position of an Underwriting
  • New Issue Holdbacks
  • Syndication Accounting
  • Definitions and Price Structure
  • Management Fee
  • Syndicate Profit
  • Allowable Syndicate Expenses
  • Payment of Underwriting Profits
  • Regulatory Approach
  • Indicators of Possible Errors in Underwriting Margin

Chapter 20 - Provider of Capital Concentration

Topics covered in this chapter are:

  • Dealer Members Affected
  • Purpose of the Concentration Test
  • Determination of Counterparties
  • Determination of Affiliates
  • Trade Date vs. Settlement Date
  • Transactions Reported
  • How to Minimize Exposure
  • Effect on Early Warning

Course Completion, Wall Certificate and Digital Badge

Upon successfully completing this course, you will be able to download a Notice of Course Completion available through your student profile. This will remain on your profile as formal confirmation of course completion.

You can also accept a digital badge through your student profile after successful course completion. Digital badges are portable image files that allow you to share your credentials across the web. You can post them to your email signature, personal website, social media channels—even to electronic copies of your resume.

CSI will mail you a wall certificate within 4 – 6 weeks of course completion. Frames to display your certificate are available. Please ensure that your First and Last Name on your profile matches your First and Last Name on your Government Issued Photo identification – this will ensure you receive an accurate certificate.

CSI will be pleased to issue an Honours Certificate to all students who obtain a final course mark of 85% or higher.

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