no incentive fees according to Asset Man Code? accounts, management, investment, expected, addition

AnalystForum

According to question 3 pg 285 CFAI Ethics...


"Company charges 2% asset based management fee. In addition, clients may pay an incentive fee at the end of each year. The incentive fee is 20% of accounts net investment income and net realized and unrealized capital gains for the year."



, [according to the recommendations and guidance of AM Code.] Managers MUST disclose to prospective clients the average or expected expenses or fees and other costs charged to them.

So i guess saying that the fee will be performanced based does not meet this requirement? Seems like they said the expected fees will be 20% of .... However, I guess they are required to be more specific under Asset Manager Code. Anyone see any other questions testing this?