US31856/US31857 Assignment 3

 Instructions:

1. Answer all the questions in the space provided below.
2. Where applicable, you will be instructed on how many answers are required e.g. minimum of 2.
3. For many questions, an example has been provided for you. This is to indicate the type of answer and level of detail that is required.
4. Instances of academic dishonesty (e.g. plagiarism) will not be tolerated and will be subject to disciplinary action.
5. Submit your assignment in Word format via your assignment portal on Radar. You have already been emailed a user guide with step-by-step instructions on how to upload your assignments.
6. Please contact support@strategi.ac.nz OR assessor@strategi.ac.nz should you require any assistance.

Task 1 (US 31857 1.1, 1.2) (LO1)

This task assesses your understanding of the economic factors and their impact on participants in the New Zealand financial services sector.

Six key factors are listed in the table below. For each factor,

• Describe what the factor is, and
• explain how it can impact participants in New Zealand’s regulatory and financial environment, and
• use an example to illustrate the impact on a minimum of three participants.

Participants may include any or all of the following:

• FMCA-licensed market participants
• Insurance companies
• Reinsurance companies
• Trustee corporations
• Licensed supervisors
• Clients and Public
• RBNZ licensed and unlicensed participants (e.g. banks and non-bank deposit taking lenders (NBDTLs))
• FMA
• AML/CFT supervisors
• FAPs including FAs and NRs

An example using the Official Cash Rate (OCR) has been completed for you.

Task 2 (US 31857 2.1, 2.2) (LO2)

This task requires you to identify key factors in the economic environment and how those factors might impact on clients and the financial advice solutions that are suitable.

Please read carefully through the scenario below and base your answer on the clients’ circumstances.

Using the given scenario:

• Identify five (5) key economic factors and how each could change and impact on Simon and Judith’s financial situation, then
• describe an appropriate financial advice solution you can provide them with, and
• explain why it is appropriate.

When answering the questions, think about how it impacts on their insurances, mortgages and investments.

Note that the answers to this question may not be found directly in the manual. Candidates are expected to build on the knowledge from the manual and think about its implications on the given scenario. You may need to do some research into the potential impact and possible solutions.

Consider all three financial services areas – insurances, mortgages and investments, to determine the impact of the economic factor. For each economic factor, you must provide a financial advice solution for at least one area.

An example has been provided for you using an increase in the OCR.

Task 3 (US 31856 1.1) (LO1)

For this task you are required to demonstrate your knowledge of the different financial markets and systems.

For the financial markets and systems listed in the table below:

• Describe the system (what it is) and
• Explain its role (what it does) – a minimum of two (2) points is required.

Please use your own words when providing your answers.

An example describing the tax system has been provided for you.

Task 4 (31856 1.2) (LO1)

There are a large number of participants in New Zealand’s financial markets and systems – both institutional and individual. The participants work together to support the operation of New Zealand’s financial markets and the economy.

For the participants listed in the table below, describe the role (s) of that participant in New Zealand’s financial markets and systems.

Please use your own words when providing your answers.

An example of a participant, financial advisers, has been completed for you.

Task 5 (31856 2.1) (LO2)

The table below lists the common types of financial services and products used by retail and wholesale customers. Describe each product/service.

Please use your own words when providing your answers.

Task 6 (31856 2.2) (LO2)

For the estate planning tools listed in the table below, outline (using bullet points):

• The applicable law, i.e. what is the relevant Act(s) under which the tool is created?
• The rules that apply, i.e. how the tool is created under the appliable law.
• How it operates, and
• What is it used for/why is it used?

An example has been provided for you.

Task 7 (31856 2.3) (LO2)

For the types of tax listed in the table below,

• outline (using bullet points) the key aspects of that type of tax, and
• how it applies in relation to financial services.

An example has been provided for you.

Task 8 (31856 3.1, 3.2) (LO3)

Clients look to financial service providers to provide them with financial advice solutions. This task requires you to apply what you have learned about the financial markets, systems, participants, services and products, to identify a suitable financial advice product or solution based on the scenario provided.

Note that your solutions are only required to be generic and you are NOT required to identify specific products or provider.

For each scenario given in the table below:

• identify a suitable financial advice solution(s);
• explain why you have chosen that solution(s), and
• list who/what entity would be able to assist the client and would be involved.

An example has been provided for you.