- CFA Exams
- CFA Exam: Level I 2021
- Study Session 1. Ethical and Professional Standards
- Reading 5. Global Investment Performance Standards (GIPS)
- Subject 1. Introduction: The Vision Statement, Objectives and Key Characteristics of GIPS Standards
CFA Practice Question
Which of the following are NOT objectives of the Global Investment Performance Standards (GIPS)?
B. obtaining countrywide acceptance of a standard for the calculation and presentation of investment performance in a fair, comparable format that provides full disclosure
C. ensuring accurate and consistent investment performance data for reporting, record keeping, marketing, and presentation
D. promoting fair, global competition among investment firms for all markets without creating barriers to entry for new firms
A. fostering the notion of industry self-regulation on a global basis
B. obtaining countrywide acceptance of a standard for the calculation and presentation of investment performance in a fair, comparable format that provides full disclosure
C. ensuring accurate and consistent investment performance data for reporting, record keeping, marketing, and presentation
D. promoting fair, global competition among investment firms for all markets without creating barriers to entry for new firms
Correct Answer: B
One of the objectives of the GIPS is to gain worldwide acceptance (not just countrywide acceptance).
User Contributed Comments 10
| User | Comment |
|---|---|
| surob | Countrywide is the key word. Be careful!!! |
| coscyrix | D is wrong too. what does entrty barriers have to do with investment performance? |
| janecb1 | Tend to agree that D is wrong too. GIPS does not address leveling the playing field for market entry of firms. |
| janecb1 | commented too soon. its actually a stated objective for GIPS to promote no-barriers entry; i suppose by ensuring that everyone is playing by the same rules entrants are not disadvantaged... |
| Nuta | Key word: barriers. GIPS are not the barrier for the investing firms. |
| Shalva | countrywide vs worldwide :-) need to be very careful |
| geofin | Bad question. Countrywide is a subset of worldwide. Suppose my objective was to eat more fruit. Today I ate an apple. Then, according to the logic of the explanation, I cannot claim that I met my objective. Because my objective was to eat FRUIT and not just apples! |
| johntan1979 | Bad logic by geofin. There are 207 countries in the world. By saying countrywide, that should be correct since that is a subset of worldwide, BUT you are only 1/207 or 0.483% correct. |
| tybe0012 | Prestige.. Worldwide |
| Inaganti6 | geofin is not here to study he's here to dictate ! |