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CFA CFA I Exam Questions
CFA Level I Chartered Financial Analyst (Page 3 )

Updated On: 15-Feb-2026
Page 3 of 793
PDF with 3960 Questions

If a firm uses non-discretionary leverage, it must present performance using:

  1. both actual returns and all-cash basis.
  2. all-cash basis i.e. removing leverage effects.
  3. actual returns.
  4. none of these answers.

Answer(s): B

Explanation:

According to Section B of the PPS standards - "Calculation of Returns" - for non-discretionary leverage, performance must be presented on an all-cash returns basis.



________ and other hybrid securities must be treated consistently across and within composites.

  1. Portfolios
  2. Convertibles
  3. Assets
  4. Bonds

Answer(s): B

Explanation:

This is one of the requirements which is mandatory in order to be in compliance with the PPS.



Standard IV (B.8), Disclosure of Referral Fees, includes ________.

  1. referral fees paid in cash
  2. referral fees paid "in kind"
  3. soft dollar referral fees
  4. all of these answers

Answer(s): D

Explanation:

Under Standard IV (B.8), appropriate disclosure involves disclosing the nature of the consideration or benefit given or received for the recommending of services. Consideration includes all fees, whether paid in cash, in soft dollars, or in kind.



Which of the following relating to compliance procedures for complying with Standard III (E) is false? The compliance procedures should:

  1. none of these answers.
  2. outline permissible conduct.
  3. delineate procedures for reporting violations and sanctions.
  4. designate a team of outside colleagues to form a review board.
  5. outline the scope of the procedures.
  6. be easy to understand.

Answer(s): D

Explanation:

The compliance officer should be designated from within the firm.



According to the AIMR-PPS for venture and private placements, ________ internal rate of return must be presented since inception of the fund and be net of fees, expenses and carry to the limited partner.

  1. limited
  2. extended
  3. cumulative
  4. general

Answer(s): C

Explanation:

Cumulative internal rate of return must be presented since inception of the fund and be net of fees, expenses and carry to the limited partner. Irr must be calculated based on cash-on-cash returns plus residual value.






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