Which of the following can be found in Standard IV?
Click on the arrows to vote for the correct answer
A. B. C. D. E.C
Standard IV states: "Members shall maintain appropriate records to support the reasonableness of recommendations or actions."
Standard IV of the CFA® (Chartered Financial Analyst®) Code of Ethics and Standards of Professional Conduct outlines the responsibilities of CFA® charterholders and candidates to their clients, employers, and the overall integrity of the financial markets. Let's go through each answer choice and determine which ones are found in Standard IV.
A. Members shall maintain knowledge of and comply with all applicable laws. This statement is aligned with the principles of Standard IV. CFA® charterholders and candidates are expected to have a thorough understanding of the laws and regulations that govern their professional activities and to ensure compliance with them. By doing so, they demonstrate professionalism and act in the best interest of their clients and the integrity of the financial markets.
B. Members shall make reasonable efforts to achieve public dissemination of material nonpublic information disclosed in breach of a duty. This statement is not found in Standard IV. In fact, CFA® charterholders and candidates are explicitly prohibited from using material nonpublic information for personal gain or for the benefit of others. They must maintain the confidentiality of such information and refrain from trading on it or disclosing it to others.
C. Members shall maintain appropriate records to support the reasonableness of recommendations. This statement is aligned with the principles of Standard IV. CFA® charterholders and candidates are expected to maintain accurate and appropriate records to substantiate the reasonableness of their investment recommendations. This helps ensure that their recommendations are based on thorough analysis and proper due diligence, thereby promoting transparency and accountability.
D. Members shall not undertake any independent practice in competition with the employer without written consent. This statement is not found in Standard IV. However, it may be covered under other standards or guidelines related to conflicts of interest or the obligations of CFA® charterholders and candidates to their employers. Standard IV focuses more on the duties and responsibilities towards clients and the integrity of the profession as a whole.
E. Members shall not participate in plagiarism. This statement is not found in Standard IV. Plagiarism refers to the act of using someone else's work, ideas, or intellectual property without proper attribution. While plagiarism is generally considered unethical, it is not specifically addressed in Standard IV. The CFA® Code of Ethics and Standards of Professional Conduct primarily focuses on professional responsibilities related to clients, employers, and the overall integrity of the financial markets.
To summarize, the answer choices that can be found in Standard IV are: A. Members shall maintain knowledge of and comply with all applicable laws. C. Members shall maintain appropriate records to support the reasonableness of recommendations.