kasinkei

Stephanie Irons, Level II CFA candidate, regularly posts in Internet chat rooms dedicated to candidates studying for the Level II exam. Throughout the season, she and other candidates discuss curriculum content in great detail. Three days after the exam, she returns to the site and vents her frustrations over complicated exam questions by posting questions she remembers on the site, and asking others for their responses and reasoning. Other candidates follow suit and post the questions they remember. Within a week, Irons and her fellow candidates are able to reconstruct about 85% of the exam from their collective memory. Finding the exercise cathartic, she is then able to return to her job and personal life and wait for her results. Irons and her fellow candidates are most likely:

A) in violation of Standard VII(A) "Conduct as Members and Candidates in the CFA Program" for providing confidential information about the exam.

B) in violation of Standard VII(A) "Conduct as Members and Candidates in the CFA Program" for discussing curriculum content in a public forum prior to the exam.

C) not in violation as the information about the actual exam contents was posted after the conclusion of the exam.

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Standard VII(A) "Conduct as Members and Candidates in the CFA Program" prohibits members and candidates from providing confidential information about the exam – even after the conclusion of the exam.

kasinkei

A CFA charterholder coaches a fellow employee as that colleague studies for the CFA exams. The charterholder tells the colleague all that she remembers from her exams and how they were constructed. This is:

A) not a violation of the standards.

B) a violation of Standard VII(B) concerning use of the designation.

C) a violation of Standard I(D) concerning professional misconduct.

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This is a violation because even though it does not necessarily compromise the integrity of the next exam, it does violate the Code of Ethics, Standard I(D) Misconduct, and Standard VII(A) Conduct as Members and Candidates in the CFA Program.  At the beginning of the CFA examination, all candidates are required to sign a statement saying they will not divulge any information regarding the exam to anyone.  In this question the Code of Ethics was broken because it requires CFA candidates and CFA Institute members to act in an ethical manner.  Standard I(D) Misconduct was broken because it requires members and candidates to not engage in any dishonest conduct.  Standard VII(A) Conduct as Members and Candidates in the CFA Program was broken because it requires members and candidates to not disregard the rules and policies of the CFA Program related to examination administration.

kasinkei

While on a business trip, John Hayes, CFA, found a notebook that had apparently been left in the waiting area of an airport. Hayes opened the notebook and read the title: Confidential: Level II CFA Examination. Before returning the notebook to CFA Institute, he made a copy and gave it to Linda Sacket, one of his firm's analysts, who was a candidate for Level II of the CFA examination. Hayes reasoned that CFA Institute would not use these questions and that Sacket would benefit from reviewing these questions. Sacket read the questions and guideline answers before taking the Level II examination. According to the CFA Institute Standards of Professional Conduct:

A) Hayes violated the Standards, but Sacket did not.

B) Sacket violated the Standards, but Hayes did not.

C) both Hayes and Sacket violated the Standards.

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Both violated Standard VII(A) because they committed an act that compromised the validity of the examinations leading to the award of the right to use the CFA designation.

luckygiftvn

Ron Vasquez is registered to sit for the CFA Level II exam. Unfortunately, Vasquez has failed the exam the past two years. In his frustration, Vasquez posted the following comment on a popular internet bulletin board: “I believe that CFA Institute is intentionally limiting the number of charterholders in order to increase its cash flow by continuing to fail candidates. Just look at the pass rates.”

Which of the following statements regarding Vasquez’s conduct is CORRECT? Vasquez is:

A) not in violation of Standard I(D), Misconduct or Standard VII(A), Conduct as Members and Candidates in the CFA Program.

B) in violation of Standard VII(A), Conduct as Members and Candidates in the CFA Program, but not in violation of Standard I(D), Misconduct.

C) in violation of both Standard I(D), Misconduct and Standard VII(A), Conduct as Members and Candidates in the CFA Program.

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Standard VII(A), Conduct as Members and Candidates in the CFA Program does not prohibit expressing opinions about the program or the CFA Institute. Thus, Vasquez is not in violation. Nothing in the facts indicates a violation of Standard I(D), Misconduct. Standard I(D) deals with professional conduct involving dishonesty, fraud, or deceit.

luckygiftvn

All of the following are violations of Standard VII(A), Conduct as Members and Candidates in the CFA Program, EXCEPT:

A) disregarding the rules related to the administration of the CFA examination.

B) improperly using the CFA Designation to further professional goals.

C) expressing opinions in disagreement with CFA Institute advocacy positions.

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Members and Candidates are allowed to express their opinions about the CFA Institute and CFA Program without violation of any Standards. Both of the other choices are in direct violation of Standard VII(A).

luckygiftvn

Lindsay Gordon is a CFA Level II candidate living in San Francisco. Gordon’s best friend, Steve Haney, also a Level II candidate, is living in Munich. Because of the time difference between Munich and San Francisco, Gordon suggests that Haney call Gordon during the Munich exam lunch break to discuss the morning exam. Haney makes the call on exam day.

Which of the following statements regarding Gordon and Haney is CORRECT?

A) Gordon is in violation of Standard VII(A), but Haney is not in violation.

B) Neither Gordon nor Haney is in violation of Standard VII(A).

C) Both Gordon and Haney are in violation of Standard VII(A).

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Both Gordon and Haney violated Standard VII(A) by compromising the integrity of the exam. Gordon now has an unfair advantage.

luckygiftvn

For the past 5 years, Karen Beckworth, CFA, has served as a proctor for the CFA exam. Beckworth tells her assistant, a CFA Level III candidate, that she normally receives the examinations on the Thursday before the exam. Given the low pass rate at Level III, Beckworth asks her assistant if he would like an advance copy of the next exam. Beckworth’s assistant declines the offer.
Beckworth’s assistant has been very vocal about expressing his opinions about the low pass rate. The assistant claims, “there are too many charterholders and CFA Institute is deliberately failing candidates because the prestige of the CFA charter is becoming diluted.”
Which of the following statements concerning Beckworth’s and her assistant’s behavior is CORRECT?

A) Both Beckworth and her assistant are in violation of Standard VII(A).

B) Neither Beckworth nor her assistant is in violation of Standard VII(A).

C) Beckworth is in violation of Standard VII(A), but her assistant is not in violation.

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Beckworth is in violation of Standard VII(A), Conduct as Members and Candidates in the CFA Program. Beckworth compromised the integrity of the exam by offering her assistant an advance copy. Beckworth’s assistant is allowed to express his opinion without violation of any Standards.

luckygiftvn

When Wes Smith first joined Advisors, Inc., he was excited that all the analysts at the firm had the CFA designation. In letters to prospective clients, he states that this ensures that Advisors can provide better service than their competitors. With respect to Standard VII(B), Reference to CFA Institute, the CFA Designation, and the CFA Program, this is:

A) a violation because he mentions the CFA designation in the letter.

B) a violation for both mentioning the CFA designation and saying the firm can guarantee better service.

C) a violation because he cannot guarantee better service.

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According to Standard VII(B), the analyst cannot guarantee better service. Smith can mention the fact that all analysts have the designation, but he is limited in what he can say with respect to this fact. He could say, for example, that this means the analysts all had to take and pass three rigorous exams.

luckygiftvn

Which of the following statements is a violation of Standard VII(B) if it is included on a CFA charterholder’s resume?

A) Both of these are violations of Standard VII(B).

B) My earning the CFA designation indicates my superior ability.

C) My earning the CFA designation indicates my desire to maintain high standards.

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A CFA charterholder may not make claims about how earning the designation proves superior capabilities. Saying "my earning the CFA designation indicates my desire to maintain high standards" is allowed because it is a factual statement

luckygiftvn

All of the following are required for a CFA Institute member to maintain his or her active status EXCEPT:

A) Passing each exam in no more than two tries.

B) remit a completed Professional Conduct Statement on an annual basis.

C) paying membership dues to CFA Institute on an annual basis.

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Passing each exam in two or fewer tries is not required to maintain active status as a member of the CFA Institute. CFA Institute imposes both of the other choices.