Question #10
Reading: Reading 42.4 Standards of Professional Conduct Guidance for Standards IV
PDF File: Reading 42.4 Standards of Professional Conduct Guidance for Standards IV.pdf
Page: 4
Status: Correct
Correct Answer: A
Question
A firm recently hired Hal Crane, CFA, to be a supervisor in the firm. Crane has reviewed the procedures for complying with the Code and Standards in the company. It is Crane's belief that the procedures need revision in order to be effective. Crane must:
Answer Choices:
A. decline supervisory responsibilities in writing until the company adopts an adequate compliance system
B. exercise his supervisory responsibilities with the greater level of diligence required by the Code and Standards
C. make reasonable efforts to encourage the company to adopt an adequate compliance system
Explanation
According to Standard IV(C) Responsibilities of Supervisors, if Crane believes the
company's compliance procedures are not adequate, Crane should decline supervisory
responsibilities in writing until an adequate system is adopted.
(Module 42.7, LOS 42: IV(C))