Schweser volume 1 exam 2 morning session

Schweser volume 1 exam 2 morning session question 1 ethic. Why the answer is C? She has to remove her name from the report. I remember the book says if an analyst does not agree the conclusion of the research report, she does not need to remove her name from the report if she believes the research process has reasonable basis.

Right but she hasn’t been given an explanation for the higher estimates, so she can’t assume the process was reasonable.

Therefore, she has to make effort to make sure the process is reasonable, right?

I chose C but I know what you meant, I had the same doubts.

I don’t have the book with me now, but I recall it said something about the senior coming up with the higher estimates at first, then she took up the job, did her homework and adjusted the figures downwards, but the senior decided to use the original figures.

So I guess she has ground to question the validity of the higher figures but the senior overrides her decision, and theres nothing else she can do about it besides removing her name?

I think C is correct just because it does not say she makes effort to prove the report has reasonable basis. She wants to remove her name just because she is not sure whether the report is reasonable or not.

The problem states the estimates are revised the day the report is going to be distributed and therefore she does not have time to assess whether the higher estimates have a reasonable basis.

If she were able determine the higher estimates had a reasonable basis (despite differing from her estimates) she could leave her name on the report. The key clue is that it’s the day the report is going to be distributed, so she won’t have time to investigate the matter.