CFA Practice Question
Which one of the following statements about verification is false?
A. Verification reviews whether a firm is compliant on a firm-wide basis and that the construction of all composites follows GIPS requirements.
B. Verification performed by an independent third-party brings credibility to a claim of compliance.
C. Verification is a pre-requisite for conducting a global investment management business.
Explanation: Verification reviews whether a firm's process and procedures of calculation follow GIPS requirements. Verification is not required but is strongly recommended. It is not a requirement for conducting an investment business.
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