QUESTION: 109

Which of the following can be found in Standard II?

Members shall not participate in plagiarism.
Members shall maintain appropriate records to support the reasonableness of recommendations.
Members shall maintain knowledge of and comply with all applicable laws.
Members shall not undertake any independent practice in competition with employer without written consent.
Members shall make reasonable efforts to achieve public dissemination of material nonpublic information disclosed in breach of a duty.

Answer(s): A

Explanation:

Standard II states: "Members shall not copy or use, in substantially the same form as the original, material prepared by another without acknowledging and identifying the name of the author, publisher or source of such material."

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QUESTION: 110

Social factors

none of these answers.
must be a primary consideration of investments because of the ERISA rule.
may never be a primary consideration of investments.
may be a primary consideration of investments, depending on the guidelines of the investment policy.
must be a primary consideration of investments because of the prudence rule.
must be a primary consideration of investments because of the loyalty rule.

Answer(s): C

Explanation:

ERISA guidelines issued by the U.S. Department of Labor state that ERISA prudence standard requires a fiduciary to make investment decisions first on grounds of economic and investment merit. Consideration of social factors may be an incidental, but never primary, consideration of investments that are equal in economic and financial terms.

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QUESTION: 111

Jackson, an analyst, decides not to change a recommendation from buy to sell because she wants to sell her holdings first. Is there a standards violation?

No
Yes, Standard IV (A.2), Research Reports
Yes, Standard III (B), Duty to Clients and Prospects
Yes, Standard IV (B.4), Priority of Transactions

Answer(s): D

Explanation:

Jackson violated Standard IV (B.4) - Priority of Transactions Jackson has decided that she did not want to wait until all her clients have had the opportunity to sell first. Thus, her decision not to change her recommendation until she accomplished her own financial aims will result in losses to her clients if the value of the holding subsequently declines.

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QUESTION: 112

Standard III includes rules on which of the following?

Professional Misconduct
All of these answers
Prohibition against Plagiarism
Obligation to Inform Employer of Code and Standards
Use of Professional Designation
None of these answers

Answer(s): D

Explanation:

Standard III deals with Obligation to Inform Employer of Code and Standard, Duty to Employer, Disclosure of Conflicts to Employer, Disclosure of Additional Compensation Arrangements and Responsibilities of Supervisors.

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QUESTION: 109

Explanation:

QUESTION: 110

Explanation:

QUESTION: 111

Explanation:

QUESTION: 112

Explanation: