According to the AIMR-PPS, performance results of a past firm or affiliation
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A. B. C. D.D
Performance results of a past firm or affiliation must not be used to represent the historical record of a new affiliation or a new firm entity. This is a requirement for presentation of results.
The question pertains to the AIMR-PPS (Association for Investment Management and Research - Performance Presentation Standards) and the treatment of performance results of a past firm or affiliation. Let's go through each answer choice and analyze them:
A. According to this choice, performance results of a past firm or affiliation must always be linked to the historical records of the new firm to show a fair and true representation of results. However, this answer choice is not entirely accurate. While it is generally desirable to link the performance results to the historical records of the new firm, it is not an absolute requirement.
B. This answer choice states that none of the answers provided are correct. Since this is a multiple-choice question, it cannot be the correct answer itself.
C. This choice suggests that the linking of performance results to the historical records of the new firm or affiliation may or may not occur. It further states that the decision is left to the discretion of the investment manager and that any relevant information should be disclosed. This option is in line with the principles of the AIMR-PPS. The standards allow some flexibility in linking performance results to historical records, and it acknowledges that the investment manager has discretion in making this decision. However, it emphasizes the importance of disclosing such information.
D. This answer choice asserts that performance results of a past affiliation or firm must not be used to represent the historical record of a new affiliation or a new firm identity. This statement is incorrect and does not align with the AIMR-PPS. While it is not mandatory to use the performance results of a past affiliation, there may be instances where it is appropriate and meaningful to include such results in the historical record.
Considering the explanations provided, the correct answer is C. According to the AIMR-PPS, the decision to link performance results to the historical records of a new firm or affiliation may or may not occur and is left to the discretion of the investment manager. However, if performance results are included, it is important to disclose this information to ensure transparency.