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Free SOFE AFE Practice Exam with Questions & Answers | Set: 9

Questions 81

agreements may contain par cap provisions that could significantly alter the economics of the transactions.

Options:
A.

Yield-maintenance

B.

Price-cap

C.

Fixed-coupon

D.

Accounting

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Questions 82

Life insurance companies frequently make mortgage loans to affiliated companies (such as subsidiaries or companies owned by a common parent company) and to joint ventures in which the life insurance company is a joint venturer. The company must carefully examine:

Options:
A.

An affiliated company or joint venture and the transactions related to it

B.

The propriety of the accounting treatment for each loan to an affiliated company or joint venture and the transactions related to it

C.

The propriety of the accounting treatment for each loan

D.

None of these

Questions 83

An entity method is applied to corporate joint ventures and to investments in certain less than majority-owned companies in circumstances where:

Options:
A.

the investment is for the long term

B.

the investor company has the ability to exercise significant influence over the operating and financial policies of the investee company.

C.

Both A & B

D.

Neither A nor B

Questions 84

_______________ reserves for income tax purposes are referred to as maximum tax actuarial reserves (MTAR) and replace the actuarial liabilities used for accounting purposes in computing taxable income.

Options:
A.

Procedure-related

B.

Policy-related

C.

Standardized- related act

D.

None of the above

Questions 85

When no tax deductions are allowed if risks are not transferred, whereas premiums paid to insurers are tax deducible, this leads to the formation of:

Options:
A.

Portfolio

B.

Claims

C.

Captives

D.

Fronting

Exam Code: AFE
Certification Provider: SOFE
Exam Name: Accredited Financial Examiner
Last Update: Jul 12, 2025
Questions: 286

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