Ethics Flashcards
List the recommended procedures to comply with the Independence and Objectivity standard.
Identify the components of Integrity of Capital Markets.
Explain the standard for Responsibilities of Supervisors.
List some examples of attributes to consider while forming the basis for a recommendation.
Identify recommendations on how to handle client assets as part of regular account information.
Name the criteria that can be used in forming an opinion on whether research is sound.
Describe plagiarism.
Plagiarism involves copying or using materials prepared by others without acknowledging:
1) the source of the material, or
2) identifying the author and publisher. List references and sources for your conclusions.
Sourcing brings responsibility back to the author. You may distribute appropriate third-party reports but do not represent yourself as the author.
Explain the Priority of Transactions standard.
Investment transactions for clients and employers must have priority over investment transactions in which a member or candidate is the beneficial owner.
A beneficial owner may derive direct or indirect benefit from the investment position.
Describe the compliance procedures for the Additional Compensation Arrangements standards.
List the recommended compliance procedures for the Fair Dealing standard.
Disclose trade allocation procedures
Establish systematic account review
Disclose levels of service
Suggest fair-dealing compliance procedures.
Explain the mosaic theory.
Financial analysts may act on a collection, or mosaic, of material public information or nonmaterial nonpublic information without risking violation, even when the conclusion they reach would have been material had the company communicated the same.
Identify the components of Investment Analysis, Recommendations, and Actions.
Identify activities that might constitute a violation when leaving an employer.
Give examples of conduct that undermines the public’s confidence that the CFA charter represents a level of achievement based on merit and ethical conduct
Explain the prohibition against using Material Nonpublic Information.
Define “adequate” procedures.
List the recommended compliance procedures for the Loyalty, Prudence, and Care standard.
Explain the standard for Communication with Clients and Prospective Clients.
Define knowingly in the context of the Misrepresentation standard.
Identify the components of Conflicts of Interest.
Disclosure of Conflicts
Priority of Transactions
Referral Fees
Explain the Knowledge of the Law standard.
Explain the compliance procedure recommendation for the Record Retention standard.
The responsibility to maintain records that support investment action generally falls with the firm rather than individuals. Because firms are not subject to the Standards, however, members and candidates should archive research notes and other documents, either electronically or in hard copy, that support their current investment-related communications.
Describe the Standard of Misrepresentation.
Explain the standard for Reference to CFA Institute, the CFA Designation, and the CFA Program.
Explain the standard for Loyalty, Prudence, and Care.
Identify the criteria to use for reviewing selected external advisers and managers.
List the three basic conflicts of an investment advisor who also serves on another company’s board of directors.