Sign up  |  Log in

ethics doubt

Prem, wanting to enhance the business relationship with Gupta, arranges for all of Mathew’s Sri Lankan expenses to be paid for by Ashoka. These costs include food, hotel, and transport. This arrangement is based on the understanding that all security transactions resulting from Mathew’s trip to Sri Lanka will be executed through Ashoka. Ashoka’s commissions are typically similar to its competitors but it can take a few extra days to execute larger volumes of trades because Ashoka is new to the brokerage business. 

Is Prem’s arrangement to enhance business relations most likely consistent with the CFA Institute Code of Ethics and Standards of Professional Conduct?

this is a question from the topic test. The solution says its a violation with regard to best execution, but isn’t this also a violation with regard to independence and objectivity? 

"Using Wiley for my CFA journey was by far the best option… I was able to pass on my first attempt.”– Moe E., Canada

Nope. Food, hotel and transport are regular expenses on trips. If it additionally said about a 5 star hotel, a chick in the room and invitations to the national opera, then indeed it would have been an intention to divert the analyst’s independence and objectivity.

Las almas de todos los hombres son inmortales, pero las almas de los justos son inmortales y divinas.
Sócrates