- CFA Exams
- CFA Level I Exam
- Study Session 1. Ethical and Professional Standards
- Reading 3. Guidance for Standards I-VII
- Subject 8. Standard III (B) Fair Dealing
CFA Practice Question
According to the Standard of Professional Conduct on Fair Dealing, which of the following practices will assist in the fair treatment of ALL clients in disseminating information once a recommendation has been changed?
II. Lengthen the time frame from the decision to the dissemination of the change.
III. Publish personnel guidelines for pre-dissemination.
IV. Establish control over trading activity.
I. Limit the number of people involved who know about the change in recommendation before it is disseminated.
II. Lengthen the time frame from the decision to the dissemination of the change.
III. Publish personnel guidelines for pre-dissemination.
IV. Establish control over trading activity.
A. I, III, and IV only
B. I and IV only
C. All of the above
Explanation: Shortening the time frame from decision to dissemination would best support the Standard on Fair Dealing.
User Contributed Comments 5
| User | Comment |
|---|---|
| pierreE14 | CAREFULL !! Flawed answer According to CFA I Ethical and Professional standards: Sdt III Section B (Fair dealing) procedures of compliance (p56) "Shorten the time frame between decision and dissemination" and not Lengthen II is wrong. |
| dimanyc | Precisely for the reason you stated point II is incorrect, which makes the answer A. Nothing flawed here. |
| lucaspipes | Could someone explain why this is correct? "Publish personnel guidelines for pre-dissemination" |
| thebkr777 | The are supposed to give guidelines about what you can and cannot do. |
| ashish100 | thanks lucas for asking that and bkr777 for answering. dude who commented first is in panic mode it seems like lol that cfa prep tho |