Disclosures, Client Onboarding, and Documentation
What this domain tests
This domain tests required pre-investment disclosures, onboarding documents, acknowledgments, periodic reporting, and record retention. Questions often ask which document must be delivered and when.
Core rules and concepts
- The Key Information and Investment Disclosure Statement, or KIIDS, summarizes the fund objective, strategy, risks, fees, valuation, and performance. It must be provided before or at subscription.
- Onboarding includes the trust agreement or account opening form, client identification, risk disclosure statement, suitability assessment, and acknowledgment of receipt of disclosures.
- Fees must be clearly disclosed, including trustee, custodian, audit, and other fund-level charges, plus any redemption or early exit fees.
- Investors receive confirmations and periodic statements showing units, NAVPU, and value. Material changes to plan rules or risk profile require notice.
- Records must be complete, retrievable, and retained under BSP and AML requirements. Electronic delivery must be evidenced.
Worked example
A client signs the trust agreement and funds the account, but the file has no signed risk disclosure or KIIDS acknowledgment. The subscription should not be treated as complete onboarding. Compliance should obtain the missing signed documents, confirm the client received the KIIDS, and record the remediation date. If the client refuses to acknowledge the risk disclosure, escalate before accepting the investment.
Traps that cost marks
Bundling the KIIDS into a generic welcome pack with no proof of delivery; using an outdated KIIDS after a material change; omitting fund-level fees; accepting an oral risk acknowledgment; failing to document electronic delivery.