Question #40
Reading: Reading 42.3 Standards of Professional Conduct Guidance for Standards III
PDF File: Reading 42.3 Standards of Professional Conduct Guidance for Standards III.pdf
Page: 17
Status: Correct
Correct Answer: A
Question
Nancy Korthauer, CFA, has launched a new hedge fund called the Korthauer Tautology Fund and is actively soliciting clients from competitor's firms. Client presentations are necessarily brief and often take place with the prospective client's current investment advisor in the room. The Code and Standards require that:
Answer Choices:
A. member or candidate provide (on request) additional detail information which supports the abbreviated presentation
B. a prospective client’s current investment advisor not participate in meetings
C. all client presentations provide a thorough review of all elements of the investment management process. Abbreviated presentations are forbidden
Explanation
See Standard III(D). When presentations are brief, additional detail which supports the
abbreviated presentation information must be provided on request. Best practice dictates
that the member or candidate should make reference to the abbreviated nature of the
presentation.
(Module 42.6, LOS 42: III(D))