Series 24 Practice Drill – Branch Office Supervision

🧾 Series 24 Practice Drill – Branch Office Supervision
📘 Sharpen Your Knowledge of Supervisory Responsibilities

The Series 24 exam focuses heavily on the responsibilities of principals in supervising broker-dealer activities. One critical area is branch office supervision, including registration, oversight, inspections, and escalation procedures. Below is a focused drill to help you test your understanding of this topic.

🎯 Quick Recap: What Is a Branch Office?

A branch office is any location where one or more associated persons regularly conduct securities business, including:

• Soliciting or making securities sales
• Supervising associated persons

Excluded from this definition are:

• Non-sales locations
• Locations used primarily for administrative purposes
• Occasional use for client meetings (under strict conditions)

🔢 Practice Questions – Branch Office Supervision (6 Questions)

1. Which of the following is TRUE regarding branch office inspections?

A) All branch offices must be inspected quarterly
B) Supervisory branch offices must be inspected monthly
C) Non-supervisory branch offices must be inspected at least every 3 years
D) FINRA requires surprise inspections every 2 months

✅ Answer: C
Explanation: Non-supervisory branch offices must be inspected at least once every three years. Supervisory branch offices are inspected annually.

2. A location is considered a “non-branch” if it meets which of the following criteria?

A) The location is only used for back-office operations
B) It is used by two reps to meet clients 5 times a week
C) It has signage indicating a securities office
D) The location holds customer funds

✅ Answer: A
Explanation: A location used strictly for administrative or operational purposes and not for sales activity is not considered a branch office.

3. Who is responsible for ensuring that branch office activities comply with FINRA Rule 3110?

A) Registered reps assigned to the branch
B) The branch receptionist
C) The designated principal supervisor
D) The municipal securities principal

✅ Answer: C
Explanation: The designated principal is accountable for the supervision of associated persons in the office and compliance with supervisory procedures.

4. A rep works from home and occasionally places trades. Is the home office a branch?

A) No, if no client meetings take place
B) Yes, if it is used regularly to conduct securities business
C) Only if more than 25 trades are placed monthly
D) Only if clients visit the home

✅ Answer: B
Explanation: A home office used regularly for securities business, including placing trades or soliciting, is considered a branch office and must be registered.

5. How must a firm document its inspection of branch offices?

A) Written memo filed with FINRA
B) Oral confirmation from the branch rep
C) Detailed written inspection report retained internally
D) Email sent to the SEC within 7 days

✅ Answer: C
Explanation: Firms must create and retain written inspection reports that include the findings, issues addressed, and follow-up actions.

6. What must be included in the written supervisory procedures (WSPs) related to branches?

A) Names of all reps
B) Sales quotas per location
C) Escalation paths and designated supervisors
D) Compensation breakdown by region

✅ Answer: C
Explanation: WSPs must clearly define supervisory responsibilities, including the escalation path, assigned principals, and methods of oversight.

📊 Scoring

• 6 correct – Principal-level mastery
• 4–5 correct – Strong grasp; refine inspection and registration rules
• Below 4 – Review Rule 3110 and branch definitions carefully

🎓 Need full Series 24 prep kits and more drills like this?
Access study modules, WSP walkthroughs, and mock exams at
👉 https://finra-exam-mastery.com

Know your responsibilities. Pass the Series 24. Supervise with confidence.