1、2015 Level I Mock Exam AM Questions and Answers Page 1 1. Vishal Chandarana, an unemployed research analyst, recently registered for the CFA Level I exam. After two months of intense interviewing, he accepts a job with a stock brokerage company in a different region of the country. Chandarana posts
2、on a blog how being a CFA candidate really helped him get a job. He also notes how relieved he was when his new employer did not ask him about being fired from his former employer. Which CFA Institute Standards of Professional Conduct did Chandarana least likely violate? A. Loyalty to Employers B. R
3、eference to CFA Institute, the CFA Designation, and the CFA Program C. Misconduct Answer = B There is no evidence Chandarana violated Standard VII(B)Reference to CFA Institute, the CFA Designation, and the CFA Program with regard to his being a CFA candidate. Specifically, Chandarana does not overst
4、ate his competency or imply he will achieve superior performance as a result of his CFA designation. It does appear, however, Chandarana did not act with integrity when he hid information that could potentially harm his new employers reputation, thus violating Standard I(D)Misconduct and Standard IV
5、(A)Loyalty. CFA Level I “Guidance for Standards IVII“ Standard VII(B)Reference to CFA Institute, the CFA Designation, and the CFA Program, Standard I(D)Professionalism, Standard IV(A)Duty to Employers 2. David Donnigan enrolled to take the Level II CFA examination in the current year, but he did not
6、 take the exam. Donnigan advised his employer that he passed Level II. Subsequently, he registered to take the Level II exam the next year. Which CFA Institute Standards of Professional Conduct did Donnigan least likely violate? The standard related to: A. referencing candidacy in the CFA Program. B
7、. duty to employer. C. professional misconduct. Answer = A Because he registered to take the exam in the next year, Donnigan still qualifies to state he is a candidate in the CFA Program. He would not, however, be authorized to reference that he is a Level III candidate and, if asked, would need to
8、specifiy that he is a Level II candidate. CFA Level I “Guidance for Standards I-VII,“ CFA Institute Standard I(D), Standard IV(A) 【梦轩考资】 QQ106454842 专业提供CFA FRM全程高清视频+讲义2015 Level I Mock Exam AM Questions and Answers Page 2 3. Ian OSullivan, CFA, is the owner and sole employee of two companies, a pu
9、blic relations firm and a financial research firm. The public relations firm entered into a contract with Mallory Enterprises to provide public relations services, with OSullivan receiving 40,000 shares of Mallory stock in payment for his services. Over the next 10 days, the public relations firm is
10、sued several press releases that discussed Mallorys excellent growth prospects. OSullivan, through his financial research firm, also published a research report recommending Mallory stock as a “buy.“ According to the CFA Institute Standards of Professional Conduct, OSullivan is most likely required
11、to disclose his ownership of Mallory stock in: A. the press releases only. B. the research report only. C. both the press release and the research report. Answer = C Members should disclose all matters that reasonably could be expected to impair the members objectivity as outlined in Standard I(B),
12、and Standard VI(A). CFA Level I “Guidance for Standards I-VII,“ CFA Institute Standard I(B), Standard VI(A) 4. James Woods, CFA, is a portfolio manager at ABC Securities. Woods has reasonable grounds to believe his colleague, Sandra Clarke, a CFA Level II candidate, is engaged in unethical trading a
13、ctivities that may also be in violation of local securities laws. Woods is not Clarkes supervisor, and her activities do not impact Woods or any of the portfolios for which he is responsible. Based on the Code and Standards, the recommended course of action is for Woods to: A. report Sandra Clarke t
14、o ABCs trading supervisor or compliance department. B. not take any action because he is not directly involved. C. report Sandra Clarke to the appropriate governmental or regulatory organization. Answer = A Under Standard 1(A) in situations where a member or candidate is aware of employer engagement
15、 in unethical or illegal activity, it is recommended that they attempt to stop the behavior by bringing it to the attention of a supervisor or the firms compliance department. CFA Level I “Guidance for Standards I-VII,“ CFA Institute Standard I(A) 5. After a firm presents a minimum required number o
16、f years of GIPS- compliant performance, the firm must present an additional year of performance each year, building up to a minimum of: A. 10 years of GIPS-compliant performance. B. 15 years of GIPS-compliant performance. C. 5 years of GIPS-compliant performance. Answer = A 【梦轩考资】 QQ106454842 专业提供CF
17、A FRM全程高清视频+讲义2015 Level I Mock Exam AM Questions and Answers Page 3 After a firm presents a minimum of five years of GIPS-compliant performance, the firm must present an additional year of performance each year, building up to a minimum of 10 years of GIPS-compliant performance. CFA Level I “The GI
18、PS Standards,“ CFA Institute Section: Historical Performance Record 6. Madeline Smith, CFA, was recently promoted to senior portfolio manager. In her new position, Smith is required to supervise three portfolio managers. Smith asks for a copy of her firms written supervisory policies and procedures
19、but is advised that no such policies are required by regulatory standards in the country where Smith works. According to the Standards of Practice Handbook, Smiths most appropriate course of action would be to: A. decline to accept supervisory responsibility until her firm adopts procedures to allow
20、 her to adequately exercise such responsibility. B. require the employees she supervises to adopt the CFA Institute Code of Ethics and Standards of Professional Conduct. C. require her firm to adopt the CFA Institute Code of Ethics and Standards of Professional Conduct. Answer = A According to guida
21、nce for Standard (IV(C), if a member cannot fulfill supervisory responsibilities because of the absence of a compliance system or because of an inadequate compliance system, the member should decline in writing to accept supervisory responsibility until the firm adopts reasonable procedures to allow
22、 the member to adequately exercise such responsibility. CFA Level I “Guidance for Standards I-VII,“ CFA Institute Standard IV(C) 7. Nicholas Bennett, CFA, is a trader at a stock exchange. Another trader approached Bennett on the floor of the exchange and verbally harassed him about a poorly executed
23、 trade. In response, Bennett pushed the trader and knocked him to the ground. After investigating the incident, the exchange cleared Bennett from any wrongdoing. Which of the following best describes Bennetts conduct in relation to the CFA Institute Code of Ethics or Standards of Professional Conduc
24、t? Bennett: A. violated the standard relating to professionalism. B. did not violate any of the Code of Ethics or Standards of Professional Conduct. C. violated both the standard relating to professionalism and integrity of capital markets. Answer = A The CFA Institute Code of Ethics requires member
25、s to act with integrity, competence, diligence, respect, and in an ethical and professional manner. The Standards of Professional Conduct relating to professional misconduct state members and candidates must not commit any act reflecting adversely on their professional reputation, integrity, or comp
26、etence. Bennetts actions violated the Code of Ethics and StandardI(D)Professionalism, but not Standard IIIntegrity of Capital Markets. CFA Level I “Guidance for Standards I-VII,“ CFA Institute Standard I(D), Standard II 【梦轩考资】 QQ106454842 专业提供CFA FRM全程高清视频+讲义2015 Level I Mock Exam AM Questions and A
27、nswers Page 4 8. According to the CFA Institute Code of Ethics and Standards of Professional Conduct, trading on material nonpublic information is least likely to be prevented by establishing: A. personal trading limitations. B. selective disclosure. C. firewalls. Answer = B Selective disclosure occ
28、urs when companies discriminate in making material nonpublic information public. Corporations that disclose information on a limited basis create the potential for insider-trading violations. See Standard II(A). CFA Level I “Guidance for Standards I-VII,“ CFA Institute Standard II(A) 9. During an on
29、-site company visit, Marsha Ward, CFA, accidentally overheard the chief executive officer of Stargazer, Inc. discussing the companys tender offer to purchase Dynamica Enterprises, a retailer of Stargazer products. According to the CFA Institute Standards of Professional Conduct, Ward most likely can
30、not use the information because: A. it was overheard and might be considered unreliable. B. she does not have a reasonable and adequate basis for taking investment action. C. it relates to a tender offer. Answer = C Trading on the information is restricted given that it relates to a tender offer; it
31、 is clearly material, nonpublic information as stated in Standard II(A). CFA Level I “Guidance for Standards I-VII,“ CFA Institute Standard II(A) 10. According to the Global Investment Performance Standards (GIPS), firms must do all of the following except: A. adhere to certain calculation methodolo
32、gies and make specific disclosures along with their performance. B. provide investors with a comprehensive view of their performance only in terms of returns. C. comply with all requirements of the GIPS standards, such as updates, guidance statements, and clarifications. Answer = B Firms must provid
33、e investors with a comprehensive view of their performance in terms of risk and returns, not just returns. CFA Level I “The GIPS Standards,” CFA Institute Section: Overview 【梦轩考资】 QQ106454842 专业提供CFA FRM全程高清视频+讲义2015 Level I Mock Exam AM Questions and Answers Page 5 11. Adira Badawi, CFA, who owns a
34、 research and consulting company, is an independent board member of a leading cement manufacturer in a small local market. Because of Badawis expertise in the cement industry, a foreign cement manufacturer looking to enter the local market has hired him to undertake a feasibility study. Under what c
35、ircumstances can Badawi most likely undertake the assignment without violating the CFA Institute Code of Ethics and Standards of Professional Conduct? A. He makes full disclosure to both companies. B. He signs confidentiality agreements with both companies. C. He receives written permission from the
36、 local company. Answer = A Making full and fair disclosure of all matters that could reasonably be expected to impair ones independence and objectivity or interfere with respective duties to ones clients is required by Standard VI(A)Disclosure of Conflicts. CFA Level I “Guidance for Standards IVII“
37、Standard VI(A)Disclosure of Conflicts 12. Which of the following is not a component of the CFA Institute Code of Ethics? A. Promote financial integrity and seek to prevent and punish abuses in the financial markets. B. Practice and encourage others to practice in a professional and ethical manner th
38、at will reflect credit on themselves and the profession. C. Place the integrity of the investment profession and the interests of clients above your own personal interests. Answer = A Punishing abuse in the financial markets is not one of the six components of the Code of Ethics. CFA Level I “Code o
39、f Ethics,” CFA Institute Section: The Code of Ethics 13. According to the Global Investment Performance Standards (GIPS), which of the following is not a part of the verification process? Testing whether the: A. firm has complied with all the composite construction requirements. B. verification is u
40、ndertaken by the compliance department in the absence of a third party. C. firms processes and procedures are designed to calculate results in compliance with GIPS standards. Answer = B 【梦轩考资】 QQ106454842 专业提供CFA FRM全程高清视频+讲义2015 Level I Mock Exam AM Questions and Answers Page 6 CFA Level I “Introdu
41、ction to the Global Investment Performance Standards (GIPS),“ CFA Institute, 2011 14. Jiro Sato, CFA, deputy treasurer for May College, manages the Student Scholarship Trust. Sato issued a request for proposal (RFP) for domestic equity managers. Pamela Peters, CFA, a good friend of Sato, introduces
42、him to representatives from Capital Investments, which submitted a proposal. Sato selected Capital as a manager based on the firms excellent performance record. Shortly after the selection, Peters, who had outstanding performance as an equity manager with another firm, accepted a lucrative job with
43、Capital. Which of the CFA charterholders violated the CFA Institute Standards of Professional Conduct? A. Both B. Neither C. Peters Answer = B Members should use reasonable care and judgment to maintain independence and objectivity, as stated in Standard I (B). There is no indication of inappropriat
44、e behavior in the selection of the equity manager or in the acceptance of employment with that manager; both decisions were based on the excellent performance records of the manager and the member, respectively. CFA Level I “Guidance for Standards I-VII,“ CFA Institute Standard I(B) 15. Claire Jones
45、, CFA, is an analyst following natural gas companies in the United States. At an industry energy conference, the chief financial officer of Alpine Energy states that the company is interested in making strategic acquisitions. At a separate event, Alpines head of exploration commented that he is bull
46、ish on natural gas production prospects within northeastern Pennsylvania. Jones is aware that Alpine currently has very little exposure to this region. She also knows another company in her universe, Pure Energy, Inc. is based in northeastern Pennsylvania and controls significant assets in the area.
47、 Pure Energy is highly leveraged, and Jones believes it will need to raise additional capital or partner with another firm to move to the production phase with their assets. Jones attempts to contact Alpines chief executive officer with an unrelated question and is told he is unavailable because he
48、is on a business trip to northeastern Pennsylvania. Jones updates her research on Pure Energy and then recommends the stock to Lisa Wong, CFA, a portfolio manager, who purchases significant positions in client accounts. The following week, Pure Energy announces it has entered into an agreement to be
49、 purchased by Alpine for a significant premium. Has either Jones or Wong most likely violated standards with regard to the integrity of capital markets? A. Yes, Jones recommendation is based on insider information B. No C. Yes, both Jones and Wong have acted on insider information Answer = B Jones has used the mosaic theory to combine nonmaterial, nonpublic information with material public information. 【梦轩考资】 QQ106454842 专业提供CFA FRM全程高清视频+讲义
