Ch 5 Deck 8 Flashcards
No employee of IB department can have this relationship with research analyst
control or supervision
No employee of an IB department can exercise influence on an analyst’s
compensation
research reports can only be reviewed by these persons outside research department prior to publication
legal of compliance
If someone besides legal or compliance outside the research firm reviews a report prior to publication it must be for the purpose of
verifying accuracy of its information
written or oral communication with research department regarding content of a research report must be made through
authorized legal or compliance personnel
Member firm may not submit any portion of research report to subject company prior to
publication
Member firm may submit a portion of research to subject company prior to publication if necessary to
verify factual information
Sections of a research report submitted to a subject company prior to publication must not contain
the research summary
Sections of a research report are submitted to a subject company prior to publication what must be reviewed by legal and compliance prior to delivery?
the complete draft of the report
if research changes its rating of a subject company after submitting a section to the subject company prior to publication it must (through legal and compliance) notify the issuer of the change no sooner than
the close of the trading date before the public announcement
No research analyst may participate in the
solicitation of investment banking business
A research analyst may not communicate with customer’s or prospective customers about
investment banking transactions
Analyst can’t be at the
pitch meeting
member firms cannot pay research analysts contingent on specific
investment banking transactions
Compensation of research analysts responsible of substance of research reports must be reviewed and approved
at least annually
Compensation of research analysts responsible of substance of research reports must be reviewed and approved by
a committee reporting to the board of directors
Compensation review committee for analysts cannot include
anyone from the IB department
Research analyst performance review cannot include input from
IB department
Research analyst performance review must be include correlation between
analyst’s recommendations and the performance of the stock
In reviewing compensation of research analysts, the committee may not consider the analyst’s contribution to the
IB business
Analysts may not purchase or receive IPO shares if
the company issuing IPO is in business sector the analyst studies
If an analyst follows a company, he may not
he is restricted on purchasing or selling any security from that company
If an analysts follows a company, he may not purchase or sell its securities within the window of
30 days before to 5 days after publishing a research report on the company or its securities
No research analyst can trade in a manner inconsistent with his own recommendations in
the member firms most recent research report
A member firm must disclose in research reports AND a research analyst must disclose in public appearances what if any interest
analyst or family member has in securities of subject company
A member firm must disclose in research reports AND a research analyst must disclose in public appearances whether firm or affiliates have owned
1% or more of company’s common stock as recently as one month before report or appearance
A member firm must disclose in research reports AND a research analyst must disclose in public appearances whether analyst or firm or affiliate has received
- compensation from the subject company for investment banking services over past 12 months
A member firm that has received compensation for non-investment banking services over the last 12 months must disclose in research reports AND a research analyst must disclose in public appearances
what services were provided
A member firm must disclose in research reports AND a research analyst must disclose in public appearances whether the analyst has served as
an officer or director of the company
