BSL201 Finance Law Workshop Questions Chapter 6

Question One

Which of the following statements is correct?

(A) A managed investment scheme is a scheme where members do not have rights or interests in the
property of the scheme.

(B) A managed investment scheme is a scheme where investors manage the operation of the
scheme.

(C) A managed investment scheme is a scheme that involves investors contributing funds to produce
a financial benefit for the management of the business.

(D) A managed investment scheme is a scheme that involves investors contributing funds to acquire
an interest in a common enterprise.

Question Two

Which of the following is not a feature of managed investment schemes under s 9 of the
Corporations Act?

(A) People contribute money as consideration to acquire rights to benefits produced by the scheme

(B) Members do not have total day-to-day control over the operation of the scheme

(C) Members have total and unrestricted day-to-day control over the operation of the scheme –
therefore it is a more hands-on type of investment than every day shareholding

Question Three

A managed investment scheme (MIS) is required to be registered if it involves more than:

(A) 20 retail investor members

(B) 200 members

(C) 2 members

(D) 1 member
Question Four

Which of the following is not a statutory duty of a responsible entity (RE) of a managed investment
scheme?

(A) to act honestly

(B) to exercise reasonable care and diligence

(C) to treat members of the same class equally

(D) to act in the best interests of members, except where there is conflict with the interests of the
responsible entity

Question Five

Responsible entities (RE) of a managed scheme must hold an Australian Financial Services licence
which is administered by ASIC. Any RE must satisfy ASIC that it is

(A) of good fame and character – 912A

(B) has available financial, technological and human resources to run the scheme

(C) has expertise to perform its duties

(D) is a proprietary company limited by guarantee (not shares)

(E) A, B & C

Question Six

In your own words, provide the definition of a managed investment scheme, when a scheme is
required to be registered and why there is this requirement for registration?

Take note of what is a managed investment schemes.

Constitution scheme is important for exam
Compliance committee is important for exam
Withdrawal from schemes (162 and 163) is important for exam

Part 2 – S601ED – Page 148/149

S912A/B