IDSC Cheatsheet — High-Yield Rules, Workflows, Decision Tables & Glossary

Use this as your supervisor “best next step” playbook for IDSC scenarios. Pair it with the Syllabus for coverage and Practice for speed.

IDSC in one picture (supervision loop)

    flowchart TD
	  A["Policies + supervision structure"] --> B["Reviews (risk-based)"]
	  B --> C["Exceptions identified"]
	  C --> D["Action: document / escalate / restrict"]
	  D --> E["Remediate controls + train staff"]
	  E --> B

Official exam snapshot (CSI)

Official exam weightings (IDSC)

Sources: https://www.csi.ca/en/learning/courses/idsc/curriculum and https://www.csi.ca/en/learning/courses/idsc/exam-credits

The supervisor’s three questions (use on every scenario)

1. Do we have permission? (policy, rules, client authority, account type, approvals)
2. Is it defensible? (KYC/suitability, conflicts managed, disclosure delivered, rationale documented)
3. Can we prove it? (evidence on file: forms, notes, review logs, escalation record, closure)

If any answer is “no”, the safest next step is usually: stop / fix / document / escalate.

Supervision fundamentals (Ch. 1–3)

What “reasonable supervision” looks like (exam-friendly)

• documented review schedule (risk-based)
• consistent execution (not ad hoc)
• evidence captured (what was reviewed and what happened next)
• closed-loop follow-up (exceptions resolved and re-tested)

Supervision best practices (fast checklist)

• clear ownership: who supervises what
• good dashboards: exception and trend reports
• escalation map: when to involve compliance/legal
• training loop: fix repeated issues with coaching + monitoring

Regulatory framework + gatekeeper duties (Ch. 4–5)

Gatekeeper mindset

Your job is not “make it pass.”
Your job is “protect the client and the firm by stopping harm early.”

High-scoring answer cues:

• increase documentation quality
• escalate appropriately
• restrict activity when uncertainty is high

AML/ATF supervision cues (high-level)

If you see unusual patterns, identity concerns, or inconsistent explanations:

• escalate
• document what triggered the concern
• preserve evidence

Risk management (Ch. 6)

Risk cycle

    flowchart LR
	  A["Identify"] --> B["Assess"]
	  B --> C["Mitigate (controls)"]
	  C --> D["Monitor + report"]
	  D --> A

Simple risk scoring (concept)

\[ \text{Risk score} = \text{Likelihood} \times \text{Impact} \]

What it tells you: A fast way to prioritize remediation and monitoring effort (higher score → higher urgency).

Common pitfall: scoring without evidence. Use incidents, exceptions, and control test results.

Controls (the three verbs)

• Prevent: stop bad outcomes before they occur (approvals, permissions, training).
• Detect: find issues quickly (surveillance, exception reports, sampling).
• Correct: fix and prevent recurrence (remediation plans + retesting).

Account opening + documentation (Ch. 7)

Account opening quality gate

If any of these are missing, the best next step is often “hold and complete”:

• authority is unclear (who can act)
• KYC fields are blank/contradictory
• account type requirements not met
• documentation is missing signatures/evidence

Older and vulnerable clients (supervision cue)

When vulnerability indicators appear, assume:

• higher documentation expectations
• clearer explanations and confirmations
• heightened escalation readiness

Conflicts + disclosures + communications (Ch. 8)

Conflict handling (high-scoring framing)

• identify the conflict (who benefits, what is at risk)
• choose the correct response (avoid / control / disclose)
• document and evidence the outcome

Sales communications (risk cues)

Watch for:

• overpromising returns
• cherry-picked performance periods
• missing risk context or fees
• unapproved marketing material

Maintaining accounts + trade reviews (Ch. 9)

Trade review triggers (what to look for)

• concentration spikes or drift
• repeated suitability overrides
• leverage usage (or changes)
• unusual trading frequency or patterns
• vulnerable client cues + complex products

“Exception thinking” (simple rule)

If it’s an exception, it needs:

1. documentation
2. review/approval
3. closure proof

Institutional + trade desk + complex product supervision (Ch. 10)

Why complex products get special supervision

• leverage can amplify losses quickly
• suitability is harder to defend
• operational and valuation complexity increases errors

High-scoring answers often include:

• pre-approval / permissions
• training requirements
• surveillance/limits
• escalation triggers

Complaints + regulators (Ch. 11–12)

Complaint handling workflow (must-know)

    flowchart LR
	  A["Complaint received"] --> B["Log + acknowledge"]
	  B --> C["Escalate based on severity"]
	  C --> D["Investigate (preserve evidence)"]
	  D --> E["Resolve + communicate"]
	  E --> F["Remediate controls + train"]

Dealing with regulators (what usually scores)

• preserve evidence and stop further harm
• involve compliance/legal early
• communicate accurately (no speculation)
• implement a remediation plan and track it to completion

Glossary (IDSC terminology)

Supervision

• Reasonable supervision: documented, risk-based reviews with evidence and follow-up closure.
• Escalation: raising issues to compliance/legal/senior management based on severity and policy requirements.
• Exception: an out-of-policy event that requires review, documentation, and closure proof.

Gatekeeping and risk

• Gatekeeper: the role of stopping harm by enforcing rules, challenging decisions, and escalating red flags.
• Risk appetite (concept): overall level and types of risk a firm is willing to accept.
• Control: policy/process/technology that prevents, detects, or corrects problems.

Client accounts

• KYC: client facts used for suitability; must be complete and current.
• Suitability: recommendation/transaction must fit objectives and constraints; requires defensible rationale.
• Documentation discipline: ability to prove what was done, when, and why (forms, notes, review logs).

Conflicts and communications

• Conflict of interest: incentive/relationship that could impair client-first judgment.
• Disclosure: required information delivered in required form, with evidence retained.
• Sales communication: marketing/performance statements that must be fair, balanced, and not misleading.

Complaints and regulators

• Complaint: any expression of dissatisfaction that should be logged and handled through a structured process.
• Evidence preservation: keep records intact for investigations (don’t overwrite the trail).
• Remediation: fix root causes via controls, training, and retesting to prevent recurrence.