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Question 1

Score: 0/0

Which disclosure is required in research reports regarding compensation under FINRA Rule 2241?

The exact dollar amount received from investment banking services

Whether the firm received compensation from the subject company in the past 12 months

The names of all investment banking clients

The specific fees charged for each transaction

to track

2026 Statistics

Key Facts: Series 16 Exam

50 + 50

Questions by Part

FINRA

72% / 74%

Passing Scores

Published FINRA outline

90m + 120m

Exam Time

FINRA

$325

Exam Fee

FINRA

34%

Largest Function Weight

Part I Function 1 and Part II Function 2

2 parts

Exam Structure

FINRA

Sample Series 16 Practice Questions

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1Which disclosure is required in research reports regarding compensation under FINRA Rule 2241?

A.The exact dollar amount received from investment banking services

B.Whether the firm received compensation from the subject company in the past 12 months

C.The names of all investment banking clients

D.The specific fees charged for each transaction

Explanation: FINRA Rule 2241 requires disclosure of whether the member firm has received compensation from the subject company in the past 12 months. The exact dollar amount, client names, and specific transaction fees are not required to be disclosed in the research report itself.

2A Supervisory Analyst identifies a potential factual error in a research report during review. What is the appropriate course of action?

A.Ignore it if the error appears minor

B.Require the analyst to verify the fact and correct it if necessary before approval

C.Approve the report but warn the analyst not to make the same error again

D.Report the analyst to FINRA immediately

Explanation: The Supervisory Analyst should require the analyst to verify the fact and correct any errors before approving the report. Supervisory review includes ensuring the accuracy of information in research reports, and factual errors should be corrected before publication.

3What is the primary purpose of the quiet period requirements under FINRA Rule 2241?

A.To allow analysts time to write reports

B.To prevent research from being used to promote new securities offerings

C.To reduce market volatility

D.To protect analyst vacation time

Explanation: The primary purpose of quiet period requirements under FINRA Rule 2241 is to prevent research from being used to promote new securities offerings. This helps ensure that research remains independent and objective, rather than serving as a marketing tool for investment banking transactions.

4A research report is approved by the Supervisory Analyst on Monday and scheduled for distribution on Wednesday. The analyst makes minor formatting changes on Tuesday. What records must be retained?

A.Only the final version distributed on Wednesday

B.Both the version approved on Monday and the final version distributed on Wednesday

C.Only the version approved on Monday

D.No records need to be retained for formatting changes

Explanation: Both the approved version and the final distributed version should be retained to document the complete approval and distribution process. While minor formatting changes may not alter the substance, maintaining both versions provides a complete audit trail of the report's evolution from approval to distribution.

5Under FINRA Rule 2241, when must a firm disclose that it makes a market in a security?

A.Only in the first report mentioning the security

B.Only if asked by a client

C.In each research report

D.Only when the market-making position exceeds 5% of outstanding shares

Explanation: FINRA Rule 2241 requires that the market-making disclosure be included in each research report. This ongoing disclosure ensures that readers always have current information about the firm's potential conflicts. Market making creates a financial interest in trading volume, which could influence research objectivity.

6Which department within a member firm is generally prohibited from pre-approving research reports before publication?

A.Compliance department

B.Investment banking department

C.Legal department

D.Supervisory department

Explanation: The investment banking department is generally prohibited from pre-approving research reports before publication under FINRA Rule 2241. This restriction is designed to prevent investment banking interests from influencing research content. Compliance, legal, and supervisory departments may review reports for regulatory compliance.

7A research analyst attends a "roadshow" lunch for an upcoming IPO hosted by the investment banking department. Under FINRA Rule 2241, what restriction applies?

A.The analyst may attend and participate fully

B.The analyst is generally prohibited from attending roadshows for offerings they will cover

C.The analyst may attend but cannot ask questions

D.The analyst may only attend if they pay for their own meal

Explanation: The analyst is generally prohibited from attending roadshows for offerings they will cover. Under FINRA Rule 2241, research analysts are generally restricted from attending roadshows to prevent them from being influenced by investment banking marketing activities. This separation helps maintain research independence.

8A firm publishes a research report on a company where the analyst has a material conflict of interest. The report includes the required disclosures. Under FINRA Rule 2241, what additional requirement may apply?

A.The report must be approved by the issuer

B.A heightened supervisory review may be required

C.The report must be published only on the firm's website

D.The report must include a price target

Explanation: A heightened supervisory review may be required. Under FINRA Rule 2241, when material conflicts of interest exist, firms may be required to implement heightened supervisory review procedures to ensure that the research remains objective and that all required disclosures are adequate. This additional oversight helps protect investors from potentially biased research.

9An analyst prepares a research report recommending the purchase of ABC Corp stock. The firm's trading desk has accumulated a significant long position in ABC Corp. What disclosure is required?

A.No disclosure is required for proprietary positions

B.Disclosure that the firm has a long position in the security

C.Disclosure of the exact number of shares held

D.Disclosure only if the position exceeds 5% of outstanding shares

Explanation: FINRA Rule 2241 requires disclosure of the firm's beneficial ownership of 1% or more of any class of common equity securities of the subject company at the time the research report is published. A significant long position creates a conflict of interest as the firm benefits from price appreciation, which could influence research objectivity.

10Under FINRA Rule 17a-4, research reports must be retained for a minimum of how many years?

A.2 years

B.3 years

C.5 years

D.7 years

Explanation: FINRA Rule 17a-4 requires that research reports be retained for at least 3 years, with the first 2 years in an easily accessible place. This applies to all research reports published by the firm, regardless of the rating or coverage status.

About the Series 16 Exam

The Series 16 qualifies supervisory analysts who review and approve research reports. It tests research-report compliance under FINRA rules, coordination and supervisory oversight during publication, factual and source review, and whether valuation conclusions, ratings, and price targets have a reasonable basis.

Assessment

Part I: 50 questions in 1 hour 30 minutes; Part II: 50 questions in 2 hours

Time Limit

3 hours 30 minutes total

Passing Score

72% Part I / 74% Part II

Exam Fee

$325 (FINRA)

Series 16 Exam Content Outline

34%

Part I: Review Communications for Rules Compliance

FINRA Rule 2241, required disclosures, conflicts, public appearances, dissemination controls, and quiet-period restrictions

16%

Part I: Liaison and Supervisory Oversight

Supervisory analyst responsibilities, internal review, recordkeeping, and coordination with research, legal, compliance, sales, and banking personnel

16%

Part II: Review Reports for Factual Support

SEC filings, source reliability, financial-statement review, data verification, and analytical consistency

34%

Part II: Determine Whether Conclusions Are Reasonable

DCF, comparables, valuation assumptions, price targets, ratings, forecasts, and whether conclusions are supported by the work

How to Pass the Series 16 Exam

What You Need to Know

Passing score: 72% Part I / 74% Part II
Assessment: Part I: 50 questions in 1 hour 30 minutes; Part II: 50 questions in 2 hours
Time limit: 3 hours 30 minutes total
Exam fee: $325

Keys to Passing

Complete 500+ practice questions
Score 80%+ consistently before scheduling
Focus on highest-weighted sections
Use our AI tutor for tough concepts

Series 16 Study Tips from Top Performers

1Treat Part I and Part II differently: Part I is about research-rule compliance and supervisory process, while Part II is about checking the analytical work behind the report.

2Memorize the practical disclosure, quiet-period, and public-appearance requirements in FINRA Rule 2241.

3When reviewing valuation questions, always test whether the assumptions, math, rating, and price target are internally consistent.

4Use SEC filings and financial statements as the base source, then ask whether the report's narrative accurately reflects those primary materials.

5Practice timed sets by part because the 90-minute regulatory section and the 120-minute analytical section feel different under pressure.

Frequently Asked Questions

What is the Series 16 exam?

The Series 16 is FINRA's Supervisory Analyst exam for professionals who review and approve research reports. It covers both the regulatory side of research communications and the analytical review needed to judge whether valuation conclusions and recommendations are reasonably supported.

How is the Series 16 structured?

Series 16 is a two-part exam. Part I has 50 multiple-choice questions in 90 minutes, and Part II has 50 multiple-choice questions in 120 minutes, for 100 questions and 3 hours 30 minutes total.

What score do I need to pass Series 16?

The latest published passing thresholds are 72% for Part I and 74% for Part II. You need to pass both parts unless FINRA grants a waiver for Part I.

Are there prerequisites or waivers for Series 16?

FINRA's current Series 16 page does not list a prerequisite or corequisite exam. Member-firm sponsorship is required for registration, and candidates who have passed CFA Level I and Level II may request a waiver of Part I through FINRA Gateway.

What should I study most for Series 16?

Prioritize FINRA Rule 2241, disclosure and conflict rules, supervisory approval standards, recordkeeping, SEC filing review, financial-statement analysis, and whether valuation methods, assumptions, ratings, and price targets are internally consistent and well supported.

What changed for Series 16 in 2026?

As of March 11, 2026, FINRA still shows the same two-part Series 16 structure and weighting on its current exam page and content outline. The current published exam fee is $325, and no newer Series 16-specific outline revision was identified.