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Free CFA-Level-I Exam Braindumps (page: 23)

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PDF with 3963 Questions

Which of the following is/are true about the PPS?

  1. Accounts of clients that are not currently under the firm's management should not be included in the presentation of the historical performance results.
    II. Compliance with PPS cannot be met on a composite-by-composite basis, only on a firm-wide basis.
    III. The PPS require that firms report, at a minimum, at least the most recent 5 years (or since inception, if less than 5 years) of performance results.
  2. III only
  3. I only
  4. I and III only
  5. II only
  6. I, II and III
  7. I and II only
  8. II and III only

Answer(s): D

Explanation:

The PPS require that firms report, at a minimum, at least the most recent 10 years (or since inception, if less than 10 years) of performance results. If this requirement cannot be met, exact reasons for this should be disclosed. Historical results should be presented as is to give a fair representation of past performance.
Dropping portfolios selectively can bias the results. Also, Compliance with PPS cannot be met on a composite- by-composite basis, only on a firm-wide basis.



Which of the following can be found in Standard III?

  1. Members must use the CFA designation in a dignified manner.
  2. If members receive material nonpublic information in confidence, they shall not breach that confidence by trading or causing others to trade in securities to which such information relates.
  3. Members shall maintain knowledge of AIMR's Code of Ethics.
  4. Members shall comply with any prohibitions on activities imposed by their employer if a conflict of interest exists.
  5. Members shall make reasonable and diligent efforts to avoid any material misrepresentation in any research report or investment recommendation.

Answer(s): D

Explanation:

Standard III states: "Members shall comply with any prohibitions on activities imposed by their employer if a conflict of interest exists."



Which of the following can be found in Standard II?

  1. Members shall make reasonable and diligent efforts to avoid any material misrepresentation in any research report or investment recommendation.
  2. Members must use the CFA designation in a dignified manner.
  3. Members shall comply with any prohibitions on activities imposed by their employer if a conflict of interest exists.
  4. Members shall maintain knowledge of AIMR's Code of Ethics.
  5. If members receive material nonpublic information in confidence, they shall not breach that confidence by trading or causing others to trade in securities to which such information relates.

Answer(s): B

Explanation:

Standard II states that holders of the CFA designation may use it, but only in a dignified and judicious manner.
The use of the designation may be accompanied by an accurate explanation of the requirements that have been met to obtain the designation.



Which of the following is/are forms of plagiarism as defined by AIMR code of conduct?

  1. Using material from a seminar in research reports without proper acknowledgment.
    II. Presenting statistical estimates prepared by others without the associated caveats and qualifiers.
    III. Using of information obtained in a teleconference without identifying the original source.
    IV. Using Standard & Poor's estimates of stock betas without attribution.
  2. I, II and IV only
  3. I, II and III only
  4. II, III and IV only
  5. II and III only

Answer(s): B

Explanation:

Standard II (C) - Prohibition against Plagiarism - considers a use of factual information published by recognized financial and statistical services without attribution acceptable. All of the others are forms of plagiarism and violations of Standard II (C).






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