Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!

CFA Events Calendar

View full calendar

Recommended Discussions

See how our partners can help you ace your CFA exams.

Question of the Week - Ethical and Professional Standards

AdaptPrepAdaptPrep Des Moines, IA, USAPosts: 211 Sr Associate
edited September 2014 in Level 1 Questions
Henry Williamson, CFA, is also a Fellow of the Society of Actuaries (SOA). Henry is required to abide by the SOA's Code of Conduct as a fellow. Part of that Code of Conduct is as follows: PRECEPT 4. An Actuary who issues an Actuarial Communication shall take appropriate steps to ensure that the Actuarial Communication is clear and appropriate to the circumstances and its intended audience and satisfies applicable standards of practice. If Henry issues actuarial communications that do not adhere to the actuarial standards of practice, what Standard would Henry most directly violate?
PassedTense
Level I:  Adapt Exam Engine + Video Lessons + Study Manual
Level II: Adapt Exam Engine + Video Lessons
Level II: Coming 2016

Free Trial with mock exam!
www.passedtense.com

Question of the Week - Ethical and Professional Standards 48 votes

Knowledge of the Law
58%
tachemanfabianWesMantoothAdaptPrepjmsatchwelljessmatPiasurangasaRandallK27Lollypollyec_testkrishTasimply_complex2kajzandshannondailyamgbattssrsinghaylouis13justgoYeshank 28 votes
Loyalty, Prudence, and Care
12%
TeemoOXNetojimywho1ghateleytoonervaRowen810 6 votes
Communication with Clients and Prospective Clients
29%
policedogmaboi_1dacraigydjak5189Allendscarpaunfer11seba216thendry7roverfanclubryleibelshanerfleuryJWhitmerPahtsan 14 votes
tachemanshannondaily

Comments

  • Knowledge of the Law
    @PassedTense‌ ;
    I didn't know that Knowledge of the Law includes other Codes of Conduct (i.e. not strictly speaking, 'law').
    Just give me all the bacon and eggs you have. Wait, wait. I'm worried what you just heard was, "Give me a lot of bacon and eggs." What I said was, "Give me all the bacon and eggs you have". Do you understand?
    fabianPahtsan
  • AdaptPrepAdaptPrep Des Moines, IA, USAPosts: 211 Sr Associate
    Knowledge of the Law

    This is an application of Standard I.A:

    Knowledge of the Law. Members and Candidates must understand and comply with all applicable laws, rules, and regulations (including the CFA Institute Code of Ethics and Standards of Professional Conduct) of any government, regulatory organization, licensing agency, or professional association governing their professional activities. In the event of conflict, Members and Candidates must comply with the more strict law, rule, or regulation. Members and Candidates must not knowingly participate or assist in and must dissociate from any violation of such laws, rules, or regulations.

    Loyalty, Prudence, and Care addresses dealings with clients. While its "act with reasonable care and exercise prudent judgment" clause may be violated, that would be indirect. There is no indication that this communication does not satisfy the Communication with Clients and Prospective Clients, but Henry must satisfy the stricter regulation.

    PassedTense
    Level I:  Adapt Exam Engine + Video Lessons + Study Manual
    Level II: Adapt Exam Engine + Video Lessons
    Level II: Coming 2016

    Free Trial with mock exam!
    www.passedtense.com

  • Knowledge of the Law

    This is an application of Standard I.A:

    Knowledge of the Law. Members and Candidates must understand and comply with all applicable laws, rules, and regulations (including the CFA Institute Code of Ethics and Standards of Professional Conduct) of any government, regulatory organization, licensing agency, or professional association governing their professional activities. In the event of conflict, Members and Candidates must comply with the more strict law, rule, or regulation. Members and Candidates must not knowingly participate or assist in and must dissociate from any violation of such laws, rules, or regulations.

    Loyalty, Prudence, and Care addresses dealings with clients. While its "act with reasonable care and exercise prudent judgment" clause may be violated, that would be indirect. There is no indication that this communication does not satisfy the Communication with Clients and Prospective Clients, but Henry must satisfy the stricter regulation.

    Useful - thanks!
    Just give me all the bacon and eggs you have. Wait, wait. I'm worried what you just heard was, "Give me a lot of bacon and eggs." What I said was, "Give me all the bacon and eggs you have". Do you understand?
  • shannondailyshannondaily St. Louis, MOPosts: 72 Sr Associate
    edited November 2014
    Knowledge of the Law
    Woo! I got it right. 
  • Communication with Clients and Prospective Clients
    Here is what I think made this question confusing:
    "If Henry 'ISSUES ACTUARIAL COMMUNICATIONS' that do not adhere to the actuarial standards of practice, what Standard would Henry most directly violate?"
    -Leads me to think the answer relates to COMMUNICATION.
    Also, there is no indication that he didn't simply disregard his "knowledge" of the law...
    For what it's worth.

    After further consideration, I think it is impossible to violate "communications with prospects and clients".
    My question is:
    If a CFA charter holder is acting as CPA.. or acting as a professional of any other skill-set, is "Knowledge of the Law", the ONLY standard that could possibly be violated?
Sign In or Register to comment.