FINRA Series 162: 6 Sample Questions & Simulator
Series 162 sample questions, mock-exam practice, and simulator access for FINRA Supervisory Analyst Part II: Valuation of Securities in Securities Prep on web, iOS, and Android.
Series 162 is Part II of Series 16, the supervisory analyst route focused on valuation of securities. It is built around whether the supervisory analyst can validate data sources, catch weak calculations, challenge unsupported assumptions, and decide whether a research conclusion has a reasonable basis. If you are searching for Series 162 sample questions, a practice test, mock exam, or simulator, this is the main Securities Prep page to start on web and continue on iOS or Android with the same account. This page includes 6 sample questions with detailed explanations so you can validate the valuation-review style before opening the full simulator.
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What this Series 162 practice page gives you
- a direct route into the Securities Prep simulator for Series 162
- a compact public sample set focused on valuation-review decisions
- topic guidance for source validation, model logic, price-target support, and reasonable-basis review
- the same subscription across web and mobile
Series 162 exam snapshot
- Provider: FINRA
- Exam: Supervisory Analyst Qualification Examination, Part II: Valuation of Securities
- Current training reference: 50 scored questions in 120 minutes
- Registration context: valuation half of the Series 16 supervisory analyst route
Topic weighting for Series 162 practice
| Blueprint area | Approx. weight |
|---|---|
| Function 1 — Review report content for data accuracy, consistency, and calculations | 32% |
| Function 2 — Review report content to ensure a reasonable basis exists for conclusions | 68% |
How Series 162 fits the stack
Series 162 is the valuation-and-reasonable-basis half of Series 16. If your weak point is disclosure rules or dissemination controls rather than model review, open Series 161 next. If you still need the research-analyst technical base first, open Series 86 .
How to use the Series 162 simulator efficiently
- Start with source-checking and data-integrity drills before moving into larger valuation judgment calls.
- Review every miss until you can explain whether the problem is a source issue, a calculation issue, or a weak conclusion.
- Move into mixed sets once you can switch between multiples, DCF logic, forecast support, and price-target alignment smoothly.
- Finish with timed runs so the 120-minute pace feels controlled.
Free preview vs premium
- Free preview: the sample set on this page so you can validate the valuation-review style and explanation depth.
- Premium: full Series 162 simulator access on web and mobile with mixed practice, timed mock exams, detailed explanations, and progress tracking.
6 Series 162 sample questions with detailed explanations
Question 1
Topic: Function 1 — Review the Content of the Report to Assess the Accuracy, Consistency, and Sources of Data and Calculations Included in the Report
A draft report shows enterprise value calculated as equity market capitalization plus total debt, but the supporting worksheet also subtracts cash and then subtracts cash again in a later adjustment line.
What is the strongest supervisory conclusion?
- A. The model is conservative, so no change is needed
- B. The report contains a calculation-control problem because cash appears to be deducted twice
- C. The issue affects only formatting, not valuation
- D. The report is acceptable if the price target still exceeds the current market price
Best answer: B
Explanation: Series 162 expects the supervisory analyst to catch calculation integrity problems quickly. Double-adjusting cash is not a style issue. It changes the valuation logic itself and must be corrected before the report can be considered reliable.
Question 2
Topic: Function 2 — Review the Content of the Report to Ensure a Reasonable Basis Exists for the Analyst’s Conclusions
An analyst raises a stock from Hold to Buy and increases the price target by 25%, but the report shows almost no change in revenue growth, margins, or valuation multiple assumptions.
What is the main review issue?
- A. The report may lack a reasonable basis linking the new conclusion to the unchanged assumptions
- B. The price target is automatically valid because the analyst used the same model
- C. The only issue is whether the disclosure block was updated
- D. A recommendation change never needs additional explanation
Best answer: A
Explanation: Series 162 is about whether the conclusion actually follows from the analysis. If the thesis, target, and recommendation move materially while the underlying assumptions barely change, the supervisory analyst should challenge the reasonable basis for that conclusion.
Question 3
Topic: Function 1 — Review the Content of the Report to Assess the Accuracy, Consistency, and Sources of Data and Calculations Included in the Report
The report cites a market-share figure from a third-party industry source, but the analyst cannot show where the number came from or when it was last updated.
What is the best supervisory response?
- A. Accept the figure because third-party data is presumed reliable
- B. Require source support or remove the figure before approval
- C. Keep the figure if it is not central to the conclusion
- D. Replace the source citation with a generic note that the data is “industry based”
Best answer: B
Explanation: Source integrity matters. The supervisory analyst does not need to reject all third-party data, but the report should not rely on unsupported figures that cannot be traced or validated, especially when they influence the thesis.
Question 4
Topic: Function 2 — Review the Content of the Report to Ensure a Reasonable Basis Exists for the Analyst’s Conclusions
An analyst uses a peer multiple significantly above the rest of the group because one peer had a temporary takeover rumor that inflated its price.
What is the strongest review conclusion?
- A. The high peer multiple is fine because market price is always the best indicator
- B. The peer set may be distorted, weakening the reasonableness of the conclusion
- C. The issue affects only disclosure, not valuation
- D. The report is acceptable if the same peer was used last quarter
Best answer: B
Explanation: Series 162 often tests whether the analyst’s chosen benchmark is still analytically sound. If a peer multiple is distorted by a special event, the supervisory analyst should question whether using it still creates a reasonable valuation basis.
Question 5
Topic: Function 1 — Review the Content of the Report to Assess the Accuracy, Consistency, and Sources of Data and Calculations Included in the Report
The report states that free cash flow rose because depreciation increased. The cash-flow model, however, shows no change in capital expenditures, working capital, or operating income.
What should the supervisory analyst challenge first?
- A. Whether the report is confusing a non-cash expense with a true improvement in cash generation
- B. Whether the company should change auditors
- C. Whether the stock should be placed on a restricted list
- D. Whether the report needs a quiet-period legend
Best answer: A
Explanation: Depreciation can affect accounting earnings and indirect cash-flow presentation, but a claim that cash generation improved needs to be supported by the actual cash drivers. The supervisory analyst should challenge the logic and not let a weak statement pass as valuation support.
Question 6
Topic: Function 2 — Review the Content of the Report to Ensure a Reasonable Basis Exists for the Analyst’s Conclusions
The analyst’s report argues for a premium valuation because the company has “exceptional visibility,” but the forecast assumes flat backlog, declining renewal rates, and no margin improvement.
What is the strongest supervisory conclusion?
- A. The premium valuation may not be reasonably supported by the forecasted operating evidence
- B. The premium valuation is acceptable because qualitative language can replace forecast support
- C. The only issue is whether the renewal-rate table is formatted correctly
- D. The forecast and the recommendation do not need to align as long as the rating is Buy
Best answer: A
Explanation: Series 162 is about internal consistency and reasonable basis. If the thesis language argues for higher quality and premium valuation while the modeled operating evidence points the other way, the supervisory analyst should challenge the conclusion before approval.