CFA Practice Question

There are 221 practice questions for this study session.

CFA Practice Question

A technical analyst would argue that accounting statements ______.

I. are not needed to make investment decisions
II. are incomplete
III. are governed by GAAP
Correct Answer: I, II and III

Technical analysts believe that accounting statements, governed by GAAP, are incomplete and are not necessary to make investment decisions because only past price movements are relevant.

User Contributed Comments 7

User Comment
SriSri What is GAAP ?
Lavay Generally Accepted Accounting Principles
past1sttime No one argues that accounting statements are governed by gaap, its a fact
johntan1979 I agree. What's wrong with being governed by GAAP and what is there to argue about? As if GAAP standards makes people make poor investment decisions...
gill15 What they mean by it is the information on financial statements can vary depending on methods and stuff.

Technical analysis does not vary -- uses two variables price and volume....
cfastudypl Rightly so Gill 15 and on point, as Tech Analyst cannot be bothered with the nuances of various International Accounting Standards (IASs) or GAAP to make their decision.
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