CFA Practice Question

There are 361 practice questions for this study session.

CFA Practice Question

Kerry is a senior portfolio manager and member of the investment committee at Victoria Investments. Kerry serves as a board member for several non-profit organizations. These commitments require eight workdays per month of his time. Because he does not receive any form of compensation for these activities, Kerry does not tell anyone at work about his board activities. Does Kerry violate any CFA Institute Standards?
A. Yes, with respect to Conflict of Interest.
B. Yes, with respect to Responsibilities of Supervisors.
C. Yes, with respect to Loyalty.
Explanation: Members must make full and fair disclosure of all matters that could reasonably be expected to impair their independence and objectivity or interfere with respective duties. Kerry should discuss his outside activities with his employer and come to a mutual agreement regarding how to manage his personal commitments with his responsibilities to his employer.

User Contributed Comments 8

User Comment
katebako 'Standard IV(A) Loyalty: members must not deprive their employer of the advantage of their skills and abilities.' How is missing 8 workdays per month not in violation of Loyalty? Are you not robbing your employer of your skill-set for over a week each month?
LAWRANCE Missing 8 days is! But it is no expressed that she will be missing,maybe she can use weekends. What is significant is that she has huge interests elsewhere which might lead to conflicts with his employer...
iliavko Loyalty: Independent practice is allowed as long as you inform your employer. Sorry but this one has 2 correct answers!
renataa 'Practice' means service for remuneration... Here there is no remuneration
Tentek It seems that Loyalty is correct, because 8 workdays (not weekends). And also he serves for Non-profit organisation...how can this create Conflict of interest?
DrewEB86 I just don't understand the rationale on this one....
bridger6 It doesn't state that the 8 working days are days when he should have been working for his employer. Maybe he only does 2 days a week? I think the 8 days are meant to show that it is an significant role that could have a conflict.
haokimlu Poor question. Loyalty should be correct. Tentek is right, non-profit organisation will likely not to create a conflict of interest
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