4.1 Servicing Investors and the Contents of the Prospectus and Disclosure Document

FIMM Combined Examination FCE

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1 Introduction: The FIMM Combined Examination (FCE)

0.1 FCE Exam Facts, Registration Rules and How to Use This Guide

2 Chapter 1: Understanding Collective Investment Schemes in Malaysia

1.1 What a Collective Investment Scheme Is and How Malaysian CIS Are Classified 1.2 Investment-Linked Funds Are Not UTS; Industry Growth and History 1.3 Participants in the CIS Ecosystem: Unit Holders, Managers, Trustees, Distributors and Regulators

3 Chapter 2: Introduction to UTS and PRS

2.1 UTS and PRS as Investments: Mechanics, Unit Calculations and How They Compare 2.2 Types of Funds: By Asset Class, Fund Structure and Investment Objective 2.3 Methods of Investing and Dollar Cost Averaging 2.4 Benefits and Disadvantages of Investing in UTS and PRS 2.5 Understanding Risk and the Risks of Investing in Schemes 2.6 Shariah-Compliant Schemes, Their Risks and the Role of the Shariah Advisory Council

4 Chapter 3: Regulatory Framework

3.1 The Regulatory Framework: The SC, Other Regulators and FIMM's Dual Role 3.2 Legislation, SC Guidelines and FIMM Rules Governing UTS and PRS 3.3 Regulation of Scheme Providers and Oversight Functions 3.4 The Deed, the Prospectus or Disclosure Document, and the Product Highlights Sheet 3.5 Portfolio Constraints: Permitted Investments, Liquidity, Borrowing and Exposure Limits 3.6 Regulations for Other CIS: Real Estate Investment Trusts and Exchange-Traded Funds 3.7 Regulation and Duties of the Scheme Trustee 3.8 Regulation of Marketing and Distribution: Distributor Categories, Collection Points and Agency Structure 3.9 Registration of Consultants: Eligibility, Fit and Proper, Duration, Variation and Revocation

5 Chapter 4 (Part 1): Marketing and Distribution — Disclosure and Transactions

4.1 Servicing Investors and the Contents of the Prospectus and Disclosure Document 4.2 The Product Highlights Sheet, Advertising Standards and Account Maintenance 4.3 The Purchase Process and Suitability Assessment Before Personal Advice 4.4 Cooling-Off Rights, Repurchase of Units, Suspension and Switching 4.5 Financing the Purchase of UTS: Process, Safeguards and the Risk Disclosure Statement 4.6 EPF Transfers and Withdrawals for Investment in Approved Unit Trust Funds

6 Chapter 4 (Part 2): Marketing and Distribution — Distributions, Reporting and Service

4.7 Distributable Income, Distributions and NAV, "Buying" a Distribution and Taxation 4.8 Reporting to Investors: Confirmations, Statements, and Semi-Annual and Annual Reports 4.9 Marketing Principles, Delivering Quality Service and Handling Complaints 4.10 The Effect of Inflation, Taxation and Investment Costs on Returns 4.11 Investment Alternatives to UTS and PRS

7 Chapter 5: Code of Ethics

5.1 Compliance, Ethics and the Structure of the FIMM Code of Ethics 5.2 Core Principle 1: Honesty and Integrity 5.3 Core Principle 2: Professionalism 5.4 Core Principles 3 to 5 and Non-Compliance: Conflicts, Disclosure, Confidentiality and Misconduct

8 Chapter 6: Personal Financial Planning

6.1 Personal Financial Planning: Definition, Features, Five Areas and the Six Steps 6.2 Financial Planner Credentials, Skills, Remuneration, and How a Planner Differs from a Consultant 6.3 The Consultant's Role in Investment Planning and Advising Clients Through the Life Cycle

9 Chapter 7A: Features and Operations of UTS

7A.1 Structure of a UTS, the Trust Deed, the Parties and Modifying the Deed 7A.2 UTS Fees, Charges and Expenses, and the Management Expense Ratio 7A.3 Dealing in Units, Valuation, NAV Calculation and Unit Prices 7A.4 Forward and Historical Pricing, and the UTMC's Holding of Units 7A.5 Unit Splits, Distributions and Their Effect on NAV 7A.6 Measuring UTS Performance: Returns, Performance Tables, Risk Measures and Qualitative Factors 7A.7 Operational Aspects of Shariah-Compliant UTS and PRS and the Shariah Contracts Between the Parties 7A.8 Borrowing to Invest in UTS and the Risks of Loan Financing

10 Chapter 7B (Part 1): The Pension Landscape and the PRS Framework

7B.1 The Malaysian Pension Landscape and the Adequacy of Retirement Savings 7B.2 The World Bank's Five-Pillar Pension Framework in the Malaysian Context 7B.3 Key Players: EPF, KWAP, LTAT, Employer-Sponsored Schemes and Annuities 7B.4 Why Malaysia Needs PRS: Ageing, Longevity Risk and the Benefits of PRS 7B.5 The PRS Framework and the Private Pension Administrator (PPA) 7B.6 PRS Structure, the Trust and Deed, Advantages over Other Products, Eligibility and Contributions

11 Chapter 7B (Part 2): PRS Operations

7B.7 The PRS Default Option and Tax Incentives for Members and Employers 7B.8 The PRS Account Structure (Sub-Accounts A and B) and Vesting 7B.9 PRS Withdrawals: Pre-Retirement, Retirement, Permanent Departure, Incapacity and Death 7B.10 Switching Between Funds and Transferring Between PRS Providers (Portability) 7B.11 Unclaimed Monies, Death of a Member and PRS Nomination 7B.12 PRS Funds: Number, Core and Non-Core Funds, Objectives, Risk Profiles, Asset Classes, Authorisation and Naming 7B.13 PRS Fees, Charges and Expenses 7B.14 PRS Unit Creation, Forward Pricing, Valuation, Distributions, Performance Measurement and Electronic Communication

4.1 Servicing Investors and the Contents of the Prospectus and Disclosure Document

Key Takeaways Explain This Topic AI

No sale of units in a UTS can be made without a prospectus, and no contribution can be made to a PRS without a disclosure document.

The inside cover of a prospectus or disclosure document must carry a responsibility statement by the directors and a disclaimer that SC registration is not a recommendation to invest.

A fund whose assets consist, or will consist, of derivatives exceeding 30% of NAV must state its substantial investment in derivatives in bold on the cover.

A fund that may distribute out of capital must warn that capital will be eroded and that the cycle may continue until all capital is depleted.

The application form must include the unit trust loan financing risk disclosure statement.

Last updated: October 2026

What Good Service Looks Like

Investors are not just buying a product; they are entering a relationship with the Consultant, Distributor and Trustee. Success is measured in performance and also in:

• how easily transactions can be made;
• how responsive the provider is to requests and complaints;
• the knowledge of investor-service staff and Consultants; and

the quality of ongoing reporting and care.

Most new business comes from repeat business and referrals from satisfied investors. Satisfied investors are those who get exactly what they thought they were buying, with no unexpected surprises. The study guide warns that many investors were attracted in the past by promises of extraordinary returns and later disappointed, so the selling process must include a full explanation of risks to manage expectations.

The Disclosure Materials

• Material Scheme Purpose
• Prospectus UTS Full information so the investor can make an informed decision
• Disclosure document PRS The PRS equivalent of a prospectus

Product Highlights Sheet (PHS) UTS and PRS Short summary of key features for understanding and comparison (section 4.2)

Key rules:

No sale of UTS units without a prospectus , and no PRS contribution without a disclosure document .

Investors must get a copy (hard or soft) when they ask to subscribe, and be advised to read and understand it.

Changes must be captured in supplementary documents issued under the CMSA and SC guidelines.

Consultants must give investors the current prospectus or disclosure document, explain anything the investor needs clarified before the application is made, and know each document well enough to point investors to the relevant sections.

Minimum Contents of a Prospectus or Disclosure Document

Based on the SC's Prospectus Guidelines for CIS and the PRS Guidelines (study guide Table 4.1):

No. Part Selected required content

1 Cover page Fund name; provider and Trustee names and registration numbers; date; date of constitution; offer period (if limited); foreign-fund statements; bold statement to read the document and consult an adviser; bold pointer to the Risk Factors page; bold statement if derivatives exceed 30% of NAV

2 Inside cover Responsibility statement by the directors; disclaimer that SC authorisation and registration are not a recommendation; investors' recourse under the CMSA; Shariah certification statement for Islamic funds; expiry statement for limited-offer funds; capital-erosion warning if distributions may come from capital

3 Contents and directory Sections, definitions, glossary; addresses, telephone numbers, email and website of the provider and Trustee (and Shariah adviser or foreign-fund representative)

4 Fund details Name and category; base currency; initial offer period and price; investment objective (with a statement that material changes need investors' approval); policy and strategy; derivatives use; securities lending; distribution policy ; benchmark; permitted investments and limits; cross-trade policy; "capital not guaranteed" warning for capital-preservation funds; Shariah approval process

5 Fees, charges and expenses Charges for buying and redeeming; fund fees and expenses; policy on rebates and soft commissions

6 Transaction information Valuation bases (including suspended counters); valuation point; pricing policy (forward or historical) ; procedures for buying, redeeming, switching and transferring; cooling-off right ; distribution channels; how unit prices are calculated; warning not to pay cash to any individual agent ; mode of distribution and policy on unclaimed money

7 Scheme Provider Corporate profile, directors, the person responsible for fund management, Shariah adviser, material litigation

8 Trustee Corporate details, experience, duties, litigation, delegate (custodian) details

9 Salient terms of the deed Investors' rights, liabilities and limits; maximum fees allowed by the deed and how fees can rise; permitted expenses; removal and retirement of the provider and Trustee; termination; unit holders' meetings

• 10 Approvals and conditions Approvals obtained; any SC waivers granted
• 11 Related-party transactions and conflicts Existing and proposed transactions; how conflicts are handled
• 12 Taxation Tax adviser's opinion on the fund's and investors' tax position
• 13 Experts' reports Where applicable

14 Additional information How to follow the fund and its NAV; list of deeds; financial year-end and when reports are sent

• 15 Documents for inspection Available at the provider's registered office
• 16 Specific requirements Extra disclosures for index, money market, guaranteed, feeder funds and others

17 Application form Must comply with the CMSA and include the unit trust loan financing risk disclosure statement

Extra contents of a PRS disclosure document (Table 4.2)

Key data summary – scheme information, fund information, fees and charges, with page cross-references.

Scheme details – the scheme's name, benefits and operations.

PRS Provider – including its audit committee (members' backgrounds, functions, meeting frequency) and any Shariah advisers.

Contributions and withdrawals – procedures for contributing, withdrawals (including the tax penalty deduction on pre-retirement withdrawals), switching between funds and transferring accrued benefits to another provider.

Consents – from advisers, reporting accountants, auditors and others named in the document.

How Consultants Use This in Practice

Investor question Where to point the investor

"What does this fund invest in, and what is it trying to achieve?" Fund details: objective, policy and strategy

• "How much will it cost me?" Fees, charges and expenses; maximum fees in the salient terms of the deed
• "Can I change my mind?" Transaction information: cooling-off right
• "What could go wrong?" Risk Factors section (flagged on the cover)
• "Who looks after my money?" Trustee section and the custody arrangements
• "Will I be taxed?" Taxation report
• Exam Pointers

The responsibility statement is made by the provider's directors , collectively and individually.

The disclaimer says SC registration is not a recommendation .

Derivatives above 30% of NAV need a bold cover statement.

The cash-payment warning appears in the transaction information and in the PHS .