Series 99 Cheatsheet — Operations Workflows, Controls, Settlement & Recordkeeping

Series 99 is “operational integrity under supervision.” The best answer is usually the one that protects customer assets, follows WSPs, preserves an audit trail, and escalates early when something looks wrong.

This cheat sheet is a study aid (not legal advice). Always follow your firm’s written supervisory procedures (WSPs) and current FINRA/SEC requirements.

Exam map (where points come from)

Series 99 at a glance (FINRA)

• Items: 50 scored + 5 unscored (55 total)
• Time: 1 hour 30 minutes (90 minutes)
• Passing score: 68

Job functions and weights

Series 99 “best answer” checklist

When two answers both sound “reasonable,” pick the one that is most:

• Control-first: uses approved workflows, dual controls, and segregation of duties (high level).
• Customer-protective: reduces loss risk and prevents unauthorized movement of funds/securities (high level).
• Documented: creates/retains records (instructions, approvals, blotters, reconciliations).
• Escalated: routes suspicious, unclear, or exception cases to the right supervisor/compliance team.

Fast eliminations (often wrong on Series 99):

• “Process it anyway and fix later” (bypasses controls).
• “Hold the transfer until the dispute is resolved” (improper transfer interference).
• “Use a personal channel because it’s faster” (recordkeeping + supervision failure).

Operations workflow (how the exam thinks)

Series 99 questions often test your ability to follow the standard pipeline:

• Open/maintain the account → identity/docs → approvals → disclosures.
• Move money/securities → LOA/authorization → approved method → retain records.
• Execute/settle the trade → compare/affirm → clear → settle → resolve fails/DKs.
• Confirm and report → confirmations, prospectus delivery, account statements.
• Control the firm → reconciliations, net capital/reserve concepts, books/records retention.

If the stem asks “what should you do next?”, the safest answer usually includes follow WSPs, validate authorization, and document.

F1 — Account opening and maintenance (high yield)

• Know account types: retail vs institutional vs prime brokerage (high level).
• Know registrations: individual, joint, corporate/entity, and retirement accounts (high level).
• Retirement basics: transfer vs rollover, contribution limits, and RMD concepts (high level).
• Core onboarding controls:
  • CIP and identity verification (high level)
  • KYC record completeness (high level)
  • required approvals before activation (high level)
• Maintenance controls:
  • keep records current; restrict/freeze accounts when required (high level)
  • understand product/account-specific disclosures (ODD, prospectus; high level)
  • understand escheatment concept for dormant/unclaimed property (high level)

F1 — Cashiering and account transfers (high yield)

Movement methods you should recognize

• Wires, ACH, and journals (high level).
• LOA and instruction validation: verify authority, required signatures/guarantees, and approvals (high level).
• Sweeps/reinvestments: understand how cash is moved/invested by default and how changes are documented (high level).
• CTRs: recognize cash movement reporting triggers and escalate to the right process owners (high level).

Account transfers

• ACATS vs non‑ACATS transfers (high level).
• Residuals/residual credits: know the concept and why follow-up processing matters (high level).

Checks

• negotiable instrument basics, issuance controls, and maintaining a check blotter (high level)

Prohibited/unsafe behaviors

• check kiting/altering checks; holding checks; holding transfers; interfering with transfers (high level)

F1 — Custody and control of securities (high yield)

Know the language:

• Safekeeping vs segregation (concept).
• Street name vs directly held assets (DRS, directly held mutual fund shares; high level).
• Box count: periodic physical count/verification of securities.
• Stock record and securities blotter: core audit trail artifacts.

Transfers and restrictions:

• registered vs bearer certificates; good delivery and stock/bond powers (high level)
• lost certificates: document and escalate (high level)
• DRS and DWAC: how securities move through depository/transfer systems (high level)
• Legends and restricted/control securities: legends affect negotiability and may impose holding period constraints (high level)

F1 — Trade reporting and corrections (high yield)

• Know the purpose of trade reporting systems: accurate, timely reporting and corrections (high level).
• Recognize best-execution/capacity/quotation concepts (high level).
• Corrections:
  • as/of and past settlement date corrections
  • error account usage and controls (high level)
• Be alert to prohibited practices that can surface operationally:
  • front running, churning/excessive trading, manipulation
  • excessive markups, breakpoint sales, improper sharing of profits/losses (high level)

F1 — Margin and stock loan / securities lending (high yield)

• Different margin requirements apply across securities (high level).
• Margin accounts require agreements, disclosures, and documented approvals (high level).
• Margin calls: recognize concept and process expectations (high level).
• Stock loan/securities lending: understand basic mechanics and records (high level).
• Short sales: locate/borrow concepts and closeout themes (high level).
• Day trading and buying power: recognize the concept and common controls (high level).

F1 — Settlement and fail control (high yield)

Know the terms:

• trade comparison/affirmation
• clearing/settlement arrangements (clearing broker vs clearing facility; institutional arrangements)
• CNS concept
• DK trade and resolution workflow
• buy-ins/closeouts, aged fails, and when escalation is required (high level)
• DVP settlement concept
• repo/resale settlement concepts (high level)

Exam pattern: the safest answer usually resolves mismatches quickly, documents notices, and follows buy-in/closeout procedures.

F1 — Confirmations, statements, and tax reporting (high yield)

• Account statements: know typical information categories and pricing context (high level).
• Confirmation delivery: recognize timing/electronic delivery concepts (high level).
• Non-trade confirmations/third-party notices: recognize that some “activity notices” are required controls (high level).
• Prospectus delivery: recognize concept-level obligations for certain transactions (high level).
• Tax reporting: purpose of tax forms, cost basis concepts, and withholding themes (high level).
• Prohibited: falsifying/withholding documents or misstating prices (high level).

F1 — Financial control and books/records (high yield)

Financial controls (high level):

• FINOP responsibilities (concept)
• FOCUS report (concept)
• general ledger posting discipline (concept)
• net capital and reserve formula concepts (customer protection mindset)

Books and records (high level):

• reconciliations; posting timelines; retention (including electronic storage)
• prohibited recordkeeping behaviors (falsifying, improper retention)

F2 — Ethics, privacy, escalation, and supervision (high yield)

Professional conduct:

• communications channels are supervised; don’t use “off book” methods
• avoid conflicts and unethical compensation practices (soft dollars/commission management, high level)
• never pay commissions to unregistered persons (high level)

Privacy and identity theft:

• protect nonpublic personal information (Reg S‑P mindset, high level)
• understand OBO vs NOBO concepts (high level)
• recognize identity theft red flags and follow escalation procedures (Reg S‑ID / Red Flags Rule, high level)

Escalation:

• recognize complaints and “red flags,” then document and escalate (high level)
• know escalation destinations (supervisor, compliance, AML/operations management) per WSPs (high level)

Supervision and controls:

• segregation of duties; information barriers; entitlement policies
• WSPs: follow, update, and document supervisory processes (high level)
• BCP: know why it exists and what must be disclosed to customers (high level)

Common traps (fast review)

• approving or processing a transfer without proper authority (LOA/medallion/approvals).
• delaying transfers improperly (especially in employment disputes).
• treating “just a text/email” as outside supervision/recordkeeping.
• failing to resolve DKs/fails promptly or ignoring buy-in/closeout procedures.
• using the wrong custody/legend handling process for restricted/control securities.
• failing to document/retain records (instructions, blotters, reconciliations, approvals).
• failing to escalate privacy/identity theft red flags or customer complaints.

Glossary (expanded, Series 99 scope)

Accounts and onboarding

• CIP: Customer Identification Program; identity verification during onboarding (high level).
• Escheatment: unclaimed property process for dormant accounts/assets (high level).
• KYC: Know Your Customer; ensuring customer information is collected, updated, and usable (high level).
• Prime brokerage: operational services to other broker-dealers/financial institutions, including financing and settlement support (high level).
• Retirement transfer vs rollover: moving assets directly between like accounts vs distributing and redepositing (concept, high level).
• RMD: required minimum distribution concept for certain retirement accounts (high level).
• SSI: standing settlement instruction used for repeating settlement details; controlled due to fraud risk (high level).

Cashiering and transfers

• ACH: Automated Clearing House network for certain electronic funds transfers (high level).
• CTR: Currency Transaction Report; reporting requirement triggered by certain cash transactions (high level).
• Journal: internal transfer of positions/funds between accounts at the same firm (high level).
• LOA: letter of authorization; written instruction requiring validation and retention (high level).
• Medallion signature guarantee: program used to verify signature/authenticity for certain transfers (high level).
• ACATS: Automated Customer Account Transfer Service used for account transfers between broker-dealers (high level).
• Residual / residual credit: post-transfer cash/securities that must be swept after the main ACATS move (high level).
• Check blotter: record of check activity used for controls and audit trail (high level).
• Check kiting: fraud using timing differences between banks to create artificial balances (high level).
• Sweep: automated movement of customer cash into a designated vehicle (or between vehicles) per standing instructions (high level).

Custody, control, and certificates

• Street name: securities held in the broker-dealer’s name on the customer’s behalf (high level).
• Safekeeping vs segregation: how customer assets are held and controlled (concept).
• Box count: periodic physical count/verification of securities (concept).
• Stock record: record of securities positions used to support custody and control (high level).
• Possession and control: customer protection concept requiring firms to maintain control of customer securities (high level).
• Good delivery: conditions that make a security deliverable/transferable (high level).
• Stock/bond power: document authorizing transfer of securities ownership (high level).
• DRS: Direct Registration System; registration on issuer/transfer agent records without a paper certificate (high level).
• DWAC: Deposit/Withdrawal at Custodian; method for moving securities to/from a depository via a transfer agent (high level).
• Legend: notation restricting transferability; affects negotiability (high level).
• Restricted vs control securities: categories impacting transferability and legend removal (high level).

Trading, reporting, and settlement

• as/of: correction applied to an earlier trade date (high level).
• Error account: controlled account used to correct operational trading errors (high level).
• Comparison/affirmation: matching trade details between parties before settlement (high level).
• CNS: Continuous Net Settlement; nets obligations to reduce settlement flows (high level).
• DK: “don’t know” notice; dispute/mismatch in trade details requiring resolution (high level).
• Fail: settlement failure; can trigger buy-in/closeout processes (high level).
• Buy-in / closeout: forced purchase/closure procedure to resolve certain fails (high level).
• DVP: delivery versus payment; securities delivered only against payment (high level).
• Repo/resale: repurchase agreement settlement involving securities and cash with a repurchase commitment (high level).

Margin and stock loan

• Margin call: demand for additional equity/maintenance when account equity is insufficient (high level).
• Buying power: amount available to purchase securities under margin/day trading rules (high level).
• Maintenance margin: minimum equity requirement after purchase; triggers margin call concepts (high level).
• Locate / borrow: short sale processing concepts tied to securities lending availability (high level).
• Stock loan / securities lending: lending securities (often to support shorts) with collateral and controls (high level).

Confirmations, statements, and records

• Confirmation: trade record sent to customer summarizing execution details (high level).
• Prospectus delivery: requirement to provide offering documents for certain transactions (high level).
• Cost basis: tax reporting concept for gain/loss determination (high level).
• Books and records: required recordkeeping for operational activity, communications, and approvals (high level).
• Retention (electronic storage): storing required records in compliant electronic format with retrieval/audit capability (high level).

Financial controls (high level)

• FINOP: Financial and Operations Principal; supervises certain financial/operational reporting and controls (high level).
• FOCUS report: regulatory financial report filed by broker-dealers (high level).
• General ledger: core accounting record where operational activity is posted (high level).
• Net capital: regulatory capital requirement designed to ensure broker-dealers maintain financial stability (high level).
• Reserve formula: customer protection concept used to determine required reserves for customer funds/securities (high level).
• Reconciliation: matching internal records to external records (banks, depositories, counterparties) to detect breaks (high level).

Supervision, privacy, and controls

• Nonpublic personal information: customer information protected under privacy rules (high level).
• OBO/NOBO: objecting vs non-objecting beneficial owner; affects information sharing and communications (high level).
• Red Flags Rule: identity theft prevention program and detection/escalation expectations (high level).
• Reg S-P: SEC privacy rule framework for safeguarding and disclosing customer information (high level).
• Reg S-ID: SEC identity theft red flags framework (high level).
• Soft dollars: commission management concept where brokerage commissions are used to pay for certain research/services (high level).
• Entitlement policy: rules governing who can access specific systems/data (high level).
• Information barrier: controls limiting cross-department information flow (high level).
• Segregation of duties: separating responsibilities to reduce fraud and error risk (high level).
• WSPs: written supervisory procedures; firm’s documented supervision and compliance playbook.
• BCP: business continuity plan; procedures to continue operations during disruptions and required disclosures (high level).