AFE Exam Questions

In what, securities involve in repos are not delivered on the settlement date of the agreement and the contract may be extended upon mutual agreement of the buyer-lender and seller...

When securities repurchased under repos commonly have a principal amount that differs from principal amount of the security originally sold under the agreement, is known as:

National Association of Insurance Commissioners stated that, has no effect on the valuation of securities for statutory accounting purposes, provided the amount of the collateral a...

What represent legal agreements between buyers or sellers and represent commitments to buy or sell financial instruments at specified dates and prices?

Insurance entities usually write covered-call options because they consider the premium received for writing the options to be either:

What encompasses investment income and gains and losses, as well as custody of investment and recordkeeping?

The evaluation and subsequent purchase or sale of investments is based on the judgment of the entity's investment and finance committees.

The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date is called:

is the price in a hypothetical transaction at the measurement date in the market in which the reporting entity would transact for the asset or liability

The market in which the reporting entity would sell the asset or transfer the liability with the greatest volume and level of activity for the asset or liability is known as:

The highest and best use of the asset is _______________ if the asset would provide maximum value to market participants principally on the standalone basis.

The risk that the obligation will not be fulfilled and affects the value at which the liability is transferred is known as:

Valuation technique should be used to measure fair value and is consistent with:

Who uses valuation techniques to convert future amounts to a single present amount?

The amount that currently would be required to replace the service capacity of an asset is called:

A change in __________ or its application is appropriate if the change results in a measurement that is equally or more representative of fair value in the circumstances.

To avoid double counting or omitting the effects of risks factors what should reflect assumptions that are consistent with those inherent in the cash flows?

What technique uses a risk-adjusted discount rate and contractual, promised, or most likely cash flows?

Fair quoted techniques used to measure fair value should maximize the use of observable inputs and minimize the use of unobservable inputs.

What is made on an instrument-by-instrument basis, generally when an instrument is initially recognized in the financial statements?

Many companies have developed an asset/liability management approach that is founded on understanding product liabilities. Mortgages meet the primary objective of maintaining:

____________ is an amount of money, loaned at interest for a specified term, secured by real estate and by its improvements such as buildings and infrastructure. This form of instr...

Prepayment of a conventional mortgage loan, prior to its specified maturity, is discouraged through the general market acceptance of significant prepayment penalties. Often these p...

These are securities whose underlying assets consist of commercial mortgage loans. The commercial loans are pooled, which brings diversification and liquidity to the asset class. W...

There are many different sources of CMBS. Conduits and aggregate pools generally consist of loans newly originated, purchased or held by investment bankers until the pool is large...

A ____________ is a special variation on a second mortgage. In this form, the new lender assumes the original or first mortgage and has the responsibility of collecting all payment...

Generally, residential loans are open to prepayment at any time without penalty. To protect against a deficiency, mortgage loans should not exceed the market value of the mortgaged...

Federal Housing Administration:

Direct serving loans method requires a system of good internal control and requires that the functions be split between the Accounting Department and the Investment Department. In...

______________________ allow investments to be made, up to a certain percent of invested or total admitted assets, in assets that do not otherwise meet regulatory requirements. If...

The current representation of asset/liability dynamics is instead through __________________ which measure assets and liabilities according to the cash flows they generate.

Which of the following is NOT the primary consideration for defining the capital of a company for purposes of measuring capital adequacy?

The process of analyzing and projecting the trends of a company's capital position given its current circumstances, its recent past, and its intended business plan under a variety...

Internal Control is:

Identification and documentation of the controls and policies which address the risk management issues for each of the Standards is the necessary step for:

When investments held by life insurance enterprises should be carried in the balance sheet at amortized cost?

It indicates the lender's commitment to make a loan in accordance with the terms specified either in the borrower's loan application or in the terms the company approves for the lo...

Assets that do not otherwise meet regulatory requirements, If their domiciliary jurisdiction regulations have a this, a life insurer with a business purpose of doing so can make a...

Evidences the fair market value of the property that is security for the mortgage loan. The appraisal value is used to determine that the loan to market value ratio is in complianc...

Subsequent to the funding of a loan, the most common document/s obtained is/are: