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100+ Free IFoA SA4 Practice Questions

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Key Facts: IFoA SA4 Exam

3h 20m

Exam Duration

IFoA curriculum

300

Recommended Study Hours

IFoA curriculum

SP4

Prerequisite Subject

IFoA syllabus

Written

Format (Word)

IFoA curriculum

100

Practice Questions

OpenExamPrep

Specialist Advanced

Subject Level

IFoA qualification

SA4 is a Specialist Advanced (Fellowship-level) UK pensions subject sat over a 3 hour 20 minute computer-based written paper of long-answer, case-based questions rather than multiple choice. It builds on SP4 and carries a recommended 300 study hours. The syllabus spans the post-2024 DB scheme funding regime and TPR funding code, actuarial valuations and assumptions, investment strategy including LDI, de-risking, buy-in/buyout and superfunds, pension accounting under IAS 19 and FRS 102, DC and member options, the Pension Protection Fund and legislation, and giving actuarial advice. The IFoA does not publish a fixed question count or percentage pass mark; results are set by its Board of Examiners. This free bank provides 100 MCQs as advanced-knowledge prep.

Sample IFoA SA4 Practice Questions

Try these sample questions to test your IFoA SA4 exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1Under the UK scheme funding regime that applies to actuarial valuations with effective dates on or after 22 September 2024, what new document are trustees of defined benefit schemes required to put in place?
A.A funding and investment strategy (FIS)
B.A statement of investment principles only
C.A chair's annual governance statement
D.A master trust authorisation application
Explanation: The Pension Schemes Act 2021 and the Occupational Pension Schemes (Funding and Investment Strategy and Amendment) Regulations 2024 introduced a legal requirement for DB trustees to determine a funding and investment strategy (FIS) setting out how they will fund members' benefits over the long term. It must be agreed with the employer and documented in a statement of strategy submitted to TPR.
2Under the DB funding regime, a scheme that has reached significant maturity is expected to be funded on what basis with low dependency on the sponsoring employer?
A.A best-estimate basis assuming continued strong employer support
B.A low dependency funding basis with a low dependency investment allocation
C.A solvency (full buyout) basis at all times
D.The PPF compensation basis
Explanation: The new regime requires that by the time a scheme reaches significant maturity (the relevant date), it should be fully funded on a low dependency funding basis and invested in a low dependency investment allocation. This means assets are expected to be sufficient without further employer contributions in expectation, and are broadly matched to the cash flows and resilient to short-term market shocks.
3The Pensions Regulator's new DB funding code of practice, which came into force in November 2024, distinguishes between two routes trustees can use to demonstrate compliance with the funding and investment strategy requirements. What are these two routes called?
A.The Fast Track and the Bespoke routes
B.The Statutory and Voluntary routes
C.The Prudent and Best-Estimate routes
D.The Section 179 and Section 75 routes
Explanation: TPR's DB funding code sets out a twin-track regulatory approach: Fast Track, a set of quantitative parameters that act as a filter for lower regulatory scrutiny, and Bespoke, where trustees can justify a different approach against the same legislative principles. Fast Track is not a legal requirement but an objective benchmark TPR uses to focus its engagement.
4In a defined benefit actuarial valuation, the technical provisions represent the:
A.Estimated cost of all future benefits including future accrual on a best-estimate basis
B.Cost of securing benefits with an insurer in the bulk annuity market
C.Amount of assets needed to make provision for benefits already accrued, using prudent assumptions
D.Compensation that the PPF would pay following employer insolvency
Explanation: Under the scheme funding legislation, technical provisions are the amount required, on an actuarial calculation, to make provision for the scheme's accrued liabilities. The assumptions used must be chosen prudently, taking account of the FIS, and the value is based on pensionable service up to the valuation date.
5A DB scheme's technical provisions are £480m and the market value of assets is £432m. The scheme actuary is asked for the funding level on the technical provisions basis. What is it, and how would a shortfall typically be addressed?
A.90%, with the deficit recovered through a recovery plan of additional employer contributions
B.108%, so a refund of surplus to the employer is required
C.90%, with the deficit written off immediately under FRS 102
D.112%, so the scheme must trigger wind-up
Explanation: The funding level is assets divided by technical provisions: 432/480 = 90%, a deficit of £48m. Where technical provisions are not met, the trustees and employer must agree a recovery plan setting out how and over what period the shortfall will be eliminated, normally through additional employer contributions, taking account of the employer covenant.
6When setting the discount rate for a low dependency funding basis under the new regime, which approach is most consistent with the regulatory expectation?
A.The expected return on a high-equity growth portfolio
B.The sponsor's weighted average cost of capital
C.The insurer's bulk annuity pricing yield plus an expense loading
D.A small margin above the risk-free yield curve (a low dependency liability return)
Explanation: Low dependency means assets are highly resilient and broadly cash flow matched, so the discount rate is derived from low-risk assets such as gilts and high-quality bonds, typically expressed as the gilt or risk-free curve plus a modest margin. This reflects minimal reliance on out-performance from risky assets at maturity.
7A scheme actuary is selecting a mortality basis for a DB valuation. Which combination is standard current UK practice for projecting future improvements?
A.A base table from the SAPS/CMI S-series with the CMI mortality projections model
B.A single deterministic life expectancy of exactly 85 for all members
C.The PPF prescribed assumptions for all funding valuations
D.US RP-2014 tables with Scale MP improvements
Explanation: UK DB schemes typically adopt a base mortality table from the CMI's Self-Administered Pension Schemes (SAPS) S-series, adjusted for the scheme's experience, and project future improvements using the CMI Mortality Projections Model, which is recalibrated and released periodically. Assumptions should reflect the membership and be set prudently for funding.
8Liability-driven investment (LDI) is primarily used by DB pension schemes to:
A.Maximise expected return through a concentrated equity portfolio
B.Hedge the sensitivity of liabilities to changes in interest rates and inflation
C.Eliminate longevity risk through insurance contracts
D.Provide guaranteed nominal returns regardless of market conditions
Explanation: LDI aligns a scheme's assets with the interest-rate and inflation sensitivity of its liabilities, typically using gilts and derivatives such as interest-rate and inflation swaps. This reduces funding-level volatility caused by movements in yields and inflation expectations, which are the dominant drivers of liability value.
9Following the September 2022 gilt market stress, what was the principal risk that leveraged LDI strategies exposed for DB schemes?
A.Excessive longevity gains reducing liabilities
B.Currency risk on overseas equities
C.Collateral and liquidity risk arising from rapidly rising gilt yields and margin calls
D.Loss of PPF eligibility for affected schemes
Explanation: When gilt yields rose sharply in late September 2022, leveraged LDI positions required large additional cash collateral very quickly. Schemes had to sell assets, including longer-dated gilts, to meet margin calls, creating liquidity strain. TPR and the Bank of England responded by encouraging higher collateral resilience buffers.
10What is the key difference between a pensioner buy-in and a full buyout for a DB scheme?
A.A buy-in covers all members; a buyout covers only deferreds
B.A buy-in is uninsured; a buyout uses LDI derivatives
C.A buy-in removes the employer covenant; a buyout retains it
D.A buy-in is an asset of the scheme; a buyout transfers benefits to the insurer and the scheme can wind up
Explanation: In a buy-in, the trustees purchase a bulk annuity policy held as an asset of the scheme that matches insured members' benefits; the scheme remains liable to members. In a buyout, individual policies are issued to members, the insurer takes on the legal obligation, and the scheme can then wind up.

About the IFoA SA4 Exam

IFoA SA4 Pensions and Other Benefits Specialist Advanced develops the expertise to apply pensions and benefits knowledge to complex UK situations, including scheme funding, TPR requirements, valuations and assumptions, investment strategy and de-risking, pension accounting, member options, the PPF, legislation and giving actuarial advice.

Assessment

Computer-based written paper (Microsoft Word) with long-answer and case-based questions

Time Limit

3 hours 20 minutes

Passing Score

Determined by the IFoA Board of Examiners each session; no fixed published percentage pass mark

Exam Fee

Set per session in the IFoA Specialist Advanced exam fee schedule (Institute and Faculty of Actuaries (IFoA))

IFoA SA4 Exam Content Outline

Core

Scheme Funding Regime and TPR Requirements

The funding and investment strategy, low dependency funding and investment allocation, significant maturity and the relevant date, recovery plans, statements of strategy, and the DB funding code Fast Track and Bespoke routes.

Core

Actuarial Valuations, Assumptions and Investment

Technical provisions and funding bases, discount rate and CMI/SAPS mortality assumptions, LDI, hedging and collateral resilience, de-risking, buy-in/buyout, superfunds, longevity swaps and journey planning.

Core

Accounting, Member Options, the PPF and Advice

Pension accounting under IAS 19, FRS 102 and IFRIC 14, DC and member options including transfers and GMP equalisation, the Pension Protection Fund and legislation, and giving actuarial advice within IFoA and TAS professional standards.

How to Pass the IFoA SA4 Exam

What You Need to Know

  • Passing score: Determined by the IFoA Board of Examiners each session; no fixed published percentage pass mark
  • Assessment: Computer-based written paper (Microsoft Word) with long-answer and case-based questions
  • Time limit: 3 hours 20 minutes
  • Exam fee: Set per session in the IFoA Specialist Advanced exam fee schedule

Keys to Passing

  • Work through all 100 available questions
  • Review every answer and explanation
  • Track weak areas and revisit them
  • Use our AI tutor for tough concepts

IFoA SA4 Study Tips from Top Performers

1Anchor your funding knowledge in the post-2024 regime: be fluent in the funding and investment strategy, low dependency, significant maturity and the relevant date, and how Fast Track and Bespoke routes work under TPR's DB funding code.
2Practise comparing funding bases. Be able to explain why technical provisions, low dependency, buyout and PPF (section 179) values differ and how covenant and maturity drive the discount rate.
3Master pension accounting distinctions: IAS 19 versus FRS 102, the corporate bond discount rate, remeasurements in OCI, settlement and past service cost in profit or loss, and IFRIC 14 surplus restrictions.
4Know the de-risking toolkit cold: LDI and collateral resilience after 2022, buy-in versus buyout, superfund gateway tests and longevity swaps, and when each suits a scheme's endgame.
5For advice questions, structure answers around the client, conflicts of interest, professional standards (the Actuaries' Code and TAS 300) and clear communication of risks and uncertainties.

Frequently Asked Questions

How long is the IFoA SA4 exam?

SA4 is a computer-based written paper lasting 3 hours 20 minutes. It is completed in Microsoft Word and uses long-answer and case-based questions rather than multiple choice.

How many questions are on IFoA SA4?

The IFoA does not publish a fixed number of questions for SA4. The paper is made up of long-answer and case-study style questions across the syllabus. This free bank provides 100 multiple-choice questions as advanced-knowledge prep.

What is the passing score for IFoA SA4?

There is no fixed published percentage pass mark. The IFoA Board of Examiners sets the pass standard for each session based on the difficulty of the paper and candidate performance.

What topics does IFoA SA4 cover?

SA4 covers advanced UK pensions practice: the scheme funding regime and TPR requirements, actuarial valuations and assumptions, investment strategy, LDI and de-risking, buy-in/buyout and superfunds, accounting under IAS 19 and FRS 102, DC and member options, the PPF and legislation, and giving actuarial advice.

Do I need SP4 before SA4?

Yes. SA4 builds directly on Subject SP4 (Pensions and Other Benefits Specialist Principles) and earlier subjects, taking the material to a Specialist Advanced level appropriate for senior practitioners.

Is this bank multiple choice if the real SA4 is written?

Yes. The real SA4 is a long-answer, case-based written paper. These 100 multiple-choice questions are designed as advanced-knowledge prep to test and reinforce the technical concepts you need before tackling full written answers.