HKSI Paper 7 Applications in the financial sector question: advising on corporate finance Type

HKSI Paper 7Applications in the financial sector

Under Schedule 5 to the SFO, which is advising on corporate finance (Type 6)? I. Advising a listed company on Listing Rules compliance. II. Telling a retail client which bank shares to buy. III. Advising shareholders generally whether to accept a takeover offer. IV. Advising a listed company on varying its share rights.

A I and III only
B I, II and III only
C I, III and IV only
D I, II, III and IV

Show the answer and explanation

Answer: C. I, III and IV only

Schedule 5 Part 2 defines advising on corporate finance as advice (a) on compliance with the Listing Rules and the Takeovers and Share Buy-backs Codes, (b) on offers to the public to buy or sell securities, or acceptance of such offers where the advice is given generally to holders, and (c) to a listed corporation or public company on corporate restructuring in respect of securities, including varying rights attached to securities. Statements I, III and IV fall within (a), (b) and (c). Statement II is advice to an investor on which securities to buy: that is advising on securities (Type 4), and the Type 4 definition excludes advice that falls within corporate finance. Source: SFO (Cap. 571) Sch. 5 Pt 2 ('advising on corporate finance', 'advising on securities') (as at October 2026).

Common mistake

Treating all advice about listed shares as corporate finance. Advice to an investor on what to buy is Type 4.

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