Discuss Acams Advanced-CAMS-Audit Exam Topic 2 Question 16

When assessing the KYC process which should an auditor observe from the customer risk assessment? (Select Two)

ASelf-declaration or Beneficial ownership should not be accepted as it is not adequate.

BOverseas shareholders not involved in the customer's dally operations are not beneficial owners.

CThe purpose and intended nature of the business relationship were not reviewed m the assessment.

DThe ultimate beneficial owners of the customer need to be Identified and verified.

EIf this was a face-to-face customer, the overall customer risk rating should be changed to low.
C: The purpose and intended nature of the business relationship are fundamental elements of customer due diligence (CDD) and should be reviewed in the risk assessment process to understand the rationale behind the customer's activities and their alignment with expected patterns.
D: Identifying and verifying the ultimate beneficial owners (UBOs) is a core principle of the KYC process to ensure transparency and mitigate risks related to hidden ownership or illicit activities.

Suggested Answer: C, D

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30 comments · newest first

Hui 10 months ago

Self-declaration alone? That's a red flag!

Son 11 months ago

Wait, are we really saying overseas shareholders aren't beneficial?

Lenna 11 months ago

Not sure about changing risk ratings just for face-to-face meetings.

Emeline 11 months ago

I agree, C is crucial too!

Aja 11 months ago

D is definitely a must for proper KYC.

Kelvin 11 months ago

I’m a bit confused about option A; I thought self-declaration could sometimes be acceptable if backed by other documentation.

Rosita 12 months ago

I feel like I’ve seen a question similar to this before, and I think both C and D might be correct since they relate to understanding the customer better.

Hollis 12 months ago

I'm not entirely sure about option C, but I remember something about the purpose of the business relationship being key in risk assessments.

Milly 1 year ago

I think option D is definitely important because identifying the ultimate beneficial owners is crucial for KYC compliance.

Golda 1 year ago

I feel pretty confident about this one. Options C and D seem like the clear choices - the auditor needs to ensure the KYC process adequately covered those fundamental elements.

Annmarie 1 year ago

The key here is understanding the core principles of KYC and customer due diligence. Identifying the ultimate beneficial owners and reviewing the purpose/nature of the business are critical steps that the auditor should be observing.

Sylvia 1 year ago

Hmm, I'm a bit confused about the options here. I'll need to carefully review the details on beneficial ownership and the purpose/nature of the business relationship to determine the best answers.

Lili 1 year ago

This question seems straightforward - the auditor should be looking at whether the customer's self-declaration and beneficial ownership information were properly assessed and verified as part of the KYC process.

Evangelina 1 year ago

I feel like the auditor should just follow the money. If the trail leads to shadowy beneficial owners, that's a problem (D). And the business purpose is key (C). Simple as that.

Blair 1 year ago

B is a bold choice. Overseas shareholders not involved? Yeah, right, that's a big red flag. D and C are the correct answers, no doubt.

Lettie 1 year ago

↳ replying to Blair

I agree, D and C are crucial for a thorough KYC process.

Cassie 1 year ago

↳ replying to Blair

B is definitely a red flag, overseas shareholders not involved is suspicious.

German 1 year ago

E is just ridiculous. Face-to-face doesn't automatically mean low risk. Gotta dig deeper with D and C.

Youlanda 1 year ago

↳ replying to German

Agreed, understanding the purpose of the business relationship and verifying the ultimate beneficial owners are key steps in the KYC process.

Shakira 1 year ago

↳ replying to German

E is not the only factor to consider. Diving into C and D is crucial for a thorough assessment.

Aretha 1 year ago

Yes, Jacki. It helps ensure transparency and mitigate risks related to hidden ownership.

Jacki 1 year ago

I believe identifying and verifying the ultimate beneficial owners is crucial in the KYC process.

Louvenia 1 year ago

Haha, self-declaration? What is this, the honor system? Definitely need to go beyond that for KYC. D and C are the way to go.

Theresia 1 year ago

↳ replying to Louvenia

Yeah, self-declaration is not reliable at all. D is crucial for identifying and verifying the ultimate beneficial owners.

Blossom 1 year ago

D and C seem like the obvious choices here. Can't have a proper KYC process without identifying the real owners and understanding the business purpose.

Valentin 1 year ago

↳ replying to Blossom

Absolutely, those two aspects are essential for a thorough KYC assessment. It's all about transparency and risk mitigation.

Rhea 1 year ago

↳ replying to Blossom

Agreed, without identifying the ultimate beneficial owners and understanding the business relationship, the KYC process would be incomplete.

Fernanda 1 year ago

↳ replying to Blossom

D and C are definitely key factors in assessing the KYC process. It's crucial to know who really owns the customer and the purpose of their business.

Kenny 1 year ago

I agree with you, Aretha. It's important to understand the rationale behind the customer's activities.

Aretha 1 year ago

I think we should observe the purpose and nature of the business relationship in the customer risk assessment.

Acams Advanced-CAMS-Audit Exam - Topic 2 Question 16 Discussion