Exam Change Announcement

NASAA recently completed its periodic review and content update of the Series 63, 65, and 66 examinations. NASAA, with the assistance of Prometric, a leading test development company, undertook a more than year-long review of each examination’s content and scoring, incorporating the feedback received by more than 1,000 industry participants and regulators. As a result of this content review, NASAA has updated the test specifications for each of its examinations to better reflect the skills and knowledge needed by broker-dealer agents and investment adviser representatives in today’s ever-changing financial industry.

While the test specifications for each examination have been updated, the content of the examinations has not dramatically shifted. Instead, some new topic areas were added, while others were modified or deemphasized.

NASAA will implement these new test specifications and scoring changes on July 1, 2016.

Below is a brief summary of the changes made to the content and scoring of each examination. The summary is not intended as a comprehensive annotation of all of the changes made to the test specifications. The full test specifications are linked below for your reference.

Series 63

The Series 63 test specifications were modified to better reflect the skills and knowledge required to be an agent of a broker dealer. With this in mind, content related to investment adviser and investment adviser representative regulation was deemphasized and focused more on definitional concepts. Further, certain subject areas, or domains, were combined or renamed to increase clarity. Finally, two new topic areas were added to the examination, highlighting the importance of advertising and correspondence, including social media, and cybersecurity and data protection.

The number of items on the Series 63 remains unchanged, as does the passing score. The weighting of the examination and the number of questions in each topic area, however, has been adjusted slightly to better reflect the importance of certain skills or knowledge.

Series 65

The Series 65 test specifications were modified to better reflect the skills and knowledge required to be an investment adviser representative. With this in mind, certain content areas were combined and/or renamed to increase clarity. Further, content regarding types of securities, such as fixed income securities, equity securities, pooled investment vehicles, and derivatives were updated to better cover topics such as asset backed securities, resale restrictions, private funds, and certain valuation methods. Also, the new specifications emphasize the characteristics of different types of investments, including pooled investment vehicles. The section on alternative investments was also updated in light of the changing marketplace. Certain topics regarding broker-dealer registration and regulation were deemphasized and limited. Finally, new areas were added to highlight the importance of advertising and correspondence, including social media; cybersecurity and data protection; custody obligations; and antimoney laundering.

The number of items on the Series 65 remains unchanged, as does the passing score. The weighting of the examination and the number of questions in each topic area, however, has been adjusted slightly to better reflect the importance of certain skills or knowledge.

Series 66

The Series 66 test specifications were modified to better reflect the skills and knowledge required to be a dually registered agent of a broker dealer and investment adviser representative, keeping in mind that FINRA’s Series 7 Examination remains a co-requisite for registration based on the Series 66. Certain content areas on the Series 66 were renamed, combined, and/or reorganized to increase clarity. In other content areas, additional examples were added to clarify certain topics, such as valuation methods of fixed income securities and equity securities. Also, content regarding alternative investments was expanded to include additional investment types, given changing market conditions, and new areas regarding other assets were included. Further, topics regarding client type and ownership and estate planning techniques were expanded. Also, topics were added in respect to exemptions for exempt reporting advisers and private fund advisers, along with areas regarding broker-dealer agent and investment adviser representative supervision. Finally, new areas were added to highlight the importance of advertising and correspondence, including social media; cybersecurity and data protection; custody obligations; and antimoney laundering.

The number of items on the Series 66 remains unchanged. The passing score for the Series 66, however, has been modified to better reflect the weighting of the examination and the number of questions on each topic. The new passing score on the Series 66 is 73 correct out of 100.

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