Which of the following is LEAST LIKELY to be considered a “material” piece of information regarding a company: A. A government report of economic trends affecting a company. B. Loss of a customer representing a significant portion of a company’s gross sales. C. A former CFO of the company predicting long-term decline in the company’s stock. D. Changes in company management. Dudley has been hired by Carson Industries to manage its pension fund. Dudley’s fiduciary duty is owed to: A. Each of the above equally. B. The participants and beneficiaries of Carson’s pension plan. C. The shareholders of Carson. D. The management of Carson. As part of his responsibilities as a research analyst, Gonzalez, along with several other analysts, takes a tour of the corporate headquarters and meets with management of a large electronics company in Asia. The company pays for the travel and accommodations of all the analysts participating in the 2-day tour and hosts a dinner, a golf tournament, and a sightseeing excursion for them as part of the trip. Under these circumstances, Gonzalez: A. May attend the dinner and participate in the golf tournament and sight-seeing but not accept reimbursement for travel and accommodations. B. Should not accept reimbursement for his travel and accommodation expenses and should not attend the dinner or participate in the golf tournament as doing so may impinge on Gonzalez’s independence and objectivity. C. May attend the dinner and participate in the golf-tournament and sight-seeing excursion because Gonzalez considers these modest “perks” acceptable in the normal course of business. D. May accept the reimbursement for the travel and accommodations because the firm paid for all the analysts and did not show favoritism to Gonzalez.
B) A former CFO’s predictions B) Fiducuary duty is always owed to the beneficiaries of a pension plan if that is the client. B) Shouldn’t attend dinner/golf
I got these 3 right on the practice test. C) Former CEO doesn’t have material info. Everything else is material. B) ALWAYS THE FINAL CUSTOMER B) He can’t take any of that. (He could take the hotel, but that isn’t a choice.) GOOD LUCK!
- C 2. B 3. B
C B B
Yeah NY, that’s what I put on the test but apparently it is, makes since that a former employees opinion is even less material though…
So no mixing business with pleasure…what a shame, I love golf and find playing golf is a great way to enjoy a nice day while chatting with others. I would imagine plenty of business gets conducted on the golf course.
C) “former” B) and B)
ditchdigger2CFA Wrote: ------------------------------------------------------- > So no mixing business with pleasure…what a > shame, I love golf and find playing golf is a > great way to enjoy a nice day while chatting with > others. I would imagine plenty of business gets > conducted on the golf course. When I received my MS from Stanford, my uncle told me, “If you want to be a success in this town, get your membership application in for Stanford University’s Country Club.”
It’s very true. Nepotism at its finest. I worked at two different Country Clubs near my home during high school and college (first as a caddie and then as a bartender). During college I would see private equity associates and investment bankers paired up to play a round. I hardly thought it was coincidental. Also in the club roster I got a chance to learn where everyone worked and what they did. You better believe I leveraged the hell out of the network since I had worked at the club for 6 years total becoming acquainted with the members. Stanford, I’m impressed!
No one seems to get this wrong. What’s the correct answer? Which one of the following statements is FALSE with respect to the payment of brokerage commissions according to the Code and Standards? A. Brokerage commissions paid should be commensurate with the value of the brokerage and research services received. B. Brokerage commissions may be directed to pay for securities research used in managing the client’s portfolio. C. Brokerage commissions should be directed in the best interests of the client. D.Brokerage commissions may be directed to pay for the investment manager’s operating expenses. Is it D?
D.Brokerage commissions may be directed to pay for the investment manager’s operating expenses.
I got this ‘Gonzalez’ wrong too… Can anyone please clarify — Is it true that in ANY cases we should not take - dinner - participate in the golf tournament - sight-seeing - (anything else?) Hotel is ok because it is recommended that we pay by ourselves. Transportation - it depends.
C,B, B. Question 3 has been discussed before. The key point is that the standard doesn’t REQUIRE you to not accept these packages, so any answer choice that says must is wrong
Isura , Is ‘Gonzalez’ No.3 question? If standard doesn’t ‘require’, why B ‘Should not’ is correct?
Bump 1) C 2) B 3) B