CFA® Level 1 Fiduciary Powers and Duties

Determining Fiduciary's Powers and Duties

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Question

The primary determinant of a fiduciary's powers and duties are to be found in the ________.

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A. B. C. D. E. F.

B

Fiduciaries must manage any pool of assets in their control in accordance with the terms of the governing documents (such as trust documents and investment management agreements), which are the primary determinant of a fiduciary's powers and duties. Whenever their actions are contrary to provisions of those instruments or applicable law, fiduciaries are exposed to liability through litigation brought by parties at interest.