2018 CFA III errata -Important Changes

I don’t know how many of you actually checked the level 3 errata from CFA site ?

When i tried to clean up my documents today and looked this errata at Page 2 and Page 3, I am SHOCKED ~!!!

It’s really unfair for people who didn’t look at this. Why don’t CFA send us email on such important definition changes.


"Reading 24: In section 3.1.1 (page 200), third paragraph, the fourth sentence should read “The yields of the two government bonds are usually weighted so that their weighted average maturity matches the credit security’s maturity.”

The only reason I looked at it was because someone brought up that Accrual Equivalent Tax calculations were no longer testable in May 2018.

so you read the last page as well ?

I just read the page 3 and I am shocked.

just read it and am not shocked

Why shocked?

I just read page 1 the one highlighted in red is what I was referring to.

But now that I see the [1-Tg+TgTe (g/e)] I’m nervous… as Schweser did not have the g/e part…


good for you because I didn’t know until reading the errata today, when interpolating treasury bond benchmark yield you have to use maturity instead of duration.


Read it before the test to play it safe.

Think how screwed we all would have been if this was the Chartered Interpolation Exam

r u serious?

What are they using in the exercices ? Maturity or duration ? I haven’t seen them doing an errata on the exercices … they are still using duration from what I know.

Might want to check again

it would be the ultimate hubris of the test writers to test something that the CFAI can’t get right and needs to publish an errata over. Think about it - the experts writing a study note can’t get it right the first time with no time pressure but then they expect the minimally qualified candidate to get it right on exam day with time pressure. But what should we expect but hubris from CFAI test writers?

In this case this is for sure helpful and worth doing it:


Nervous too!!! But it is weird, since I proactive all T12 CFA end of chanter questions and there was no mention of this g/e…

I think the g/e depends on what you are doing. If you’re doing an FVIF for calculating a RV and therefore looking at gifting the entire estate in two steps. Some now and some at death (a bequest) then the g/e is relevant because you’re only gifting part of the estate.

in contrast if you are just looking at gifting the entire estate or a specific dollar value and how much you save, then the g/e either goes to 1 or isn’t relevant/right.

at least that’s how/why I interpreted there being two variations on the formula when studying. Anything where a formula like that is based on assumptions is going to seem weird unless you make the same assumption as the formula does. I ran into the same thing with some of the tax stuff. I’d work through problems based on actual knowledge of how the taxes worked and then look at a solution that was based on a formula that got a different result. It can be annoying if you know what is really going on.

Any way to find out when that duration example was added to the errata?

Also, isn’t this the same as the ethics standard i.e you made a recommendation and then you changed it. You are supposed to send out a notification to everyone and if some is placing an order, you have to notify them of the changed recommendation.

I see this as exactly the same situation. They should be sending an e-mail to every candidate when there is new errata published. Even get with bookshelf to change the text.

If you can’t do any of it, they shouldn’t test us on it.

What do you guys think?

I thought the point was having a centralized location for all of these changes that everyone has equal access to at the same time? Not checking the errata and then complaining about it afterwards seems silly.