CFA Practice Question

There are 361 practice questions for this study session.

CFA Practice Question

Jack Lilly, CFA, a portfolio manager for Skogland Investments, plans to manage the portfolios of several family members in exchange for a percentage of each portfolio's profits. As his family members have extensive portfolios requiring substantial attention, they have requested that Lilly provide the services outside his employment with Skogland. Lilly notifies his employer in writing of his prospective outside employment. Two weeks later, Lilly begins managing the family members' portfolios. By managing these portfolios, did Lilly violate any CFA Institute Standards of Professional Conduct?
A. Additional Compensation
B. Disclosure of Conflicts
C. Both Additional Compensation and Disclosure of Conflicts
Explanation: Members should disclose all potential conflicts of interest, the substantial time involved in managing family accounts, and when engaging in independent practice for compensation should not render services until receiving written consent from all parties.

User Contributed Comments 4

User Comment
tomalot So he did notify his employer but didn't get his consent?
iatpeio22 Yes tomalot - I saw a similar question on level 1. You have a to take this information at face value and you can't assume he received permission just because he asked for it. It surprised me too!
ashish100 awww snapp.. now that's tricky.
thanks for the heads up iatpeio22.
hope you don't get in trouble for that <3
fredpat01 Yeah cuz she did not disclose that during the two weeks before she started to manage the outside portfolio, she has been granted permission from the writing or not.
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