Standard V(C) Record Retention states that “In the absence of regulatory guidance or firm policies, CFA Institute recommends maintaining records for at least seven years.”
Basic logic implies that even if there is regulatory guidance which requires, let’s say 5 years of record retention, 7 year recommended by Standard V(C) is applied because we established at the beginning of the ethics that “…If applicable law is stricter than the requirements of the Code and Standards, members and candidates must adhere to applicable law; otherwise, they must adhere to the Code and Standards” Standard I: Professionalism
However, it is evident from CFA practice tests that, stance of CFA on this issue is to ignore requirements of Standard I: Professionalism regarding application of stricter rule.
But what is the reason that we do not apply stricter term? Is it because “7 years” is only recommendation? I really can’t get it.
Yes, because 7 years of record retention is only recommendation. The Standard I regarding application of stricter rule applies with those requirements.
So stricter rule (Standard I requirement) is applied only for mandatory cases, for recommendations of Code there is no need to apply stricter case?
The clue is at the start of the sentence “in the absence of…”
Yeah I got that, but there is another standard I which tells that apply the stricter rule. So in case if rule obliges 5 year, according to Standard V you take 5 years, because there is no absence of law and you should rely on law. However, Standard I requires selecting stricter of law and Code of Ethics which presumes selecting 7 years.
My point was why we don’t select 7 years, why we ignore rule of selecting strictest approach. Is it because it is recommendation and strictest rule requirement applies only to requirements of the Code or what?
I get your logic and yes, stricter rule should be followed not the stricter guidance/recommendation.
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