wilslm

According to jrozario’s answer, I think anwers for No. 2 and No. 3 conflict each other in some way. D of No. 2 said omitted some relavant factors in the report is not violate mispresentation while in No. 3 which is III. Members must include all relevant factors in research reports. Unless D of No. 2 is violation some other standard.
I think A of No. 2 should be the answer since it is violation of misconduct.

mar350

I thought guaranteeing a specific return is a misconduct.

KungFuPanda

The answers don’t make much sense:
1. > Gaines, a financial analyst for Skinner Investment
> Counseling, is told by the investor relations
> representative for Firebird Avionics, a major
> aircraft parts manufacturer, that the firm is in
> the final stages of building a new fuel efficient
> jet engine. This information is divulged by
> Firebird at the most recent quarterly conference
> call for analysts. Gaines uses this information
> along with other information he obtained from the
> company and distributed to the public in a
> research report that includes a “buy”
> recommendation for Firebird stock.
For this question, how is this not material nonpublic information? The new jet engine has only been divulged to a few analysts, not publically.
2. “Which of the following is LEAST LIKELY to be
> considered a “material” piece of information
> regarding a company:
>
> A. Changes in company management.
>
> B. A government report of economic trends
> affecting a company.
>
> C. Loss of a customer representing a significant
> portion of a company’s gross sales.
>
> D. A former CFO of the company predicting
> long-term decline in the company’s stock. ”
A material piece of information is one that will affect the stock price or outlook of a company. Are you telling me that the former CFO predicting a decline in the stock price will NOT affect the stock price of the company? All of these would affect the price, but I would imagine (B) affects it least.
3. “> Which of the following statements regarding
> research reports is/are CORRECT according to the
> Standards of Practice Handbook?
>
> I. Members should outline known limitations
> of their analysis.
> II. Reports should be supported by background
> and supporting information, and this information
> should be available to interested parties.
> III. Members must include all relevant
> factors in research reports.”
For this one, I remember reading somewhere that a member does not HAVE TO include all relevant details in research reports - as long as he outlines the known limitations of the analysis. So how is saying the SOPH *requires* ALL factors be included accurate?

ba736

I must agree with you brafique much of those answers didn’t make sense to me either.

Unforseen

^ Good to see I’m not alone! Does anyone else have any input on this?

OmarAdnan

anyone ever get correct answers to these?
thanks, John

cityboy

jrozario
Me thinks you’ve got ulterio motives!! Most of the answers you posted up there are not consistent withe Ethics readings. Case in point your answer for this: “Which of the following is LEAST LIKELY to be considered a “material” piece of information regarding a company”
As some have pointed out, the correct answer is B - as the gov is not an insider and hence least reliable.
Please stop the mischief!

king_kong

Jrozario
How do you know you answered those questions correct? When I took the exam, I got 90% correct but it did not tell me which questions I missed. Unless you got 100% correct on the exam, I don’t see how you know that you did not miss one or more of those questions.

cfalevel2011

The exam tells you which questions you missed it just doesn’t tell you the correct answer to the question. There should’ve been a “1 of 1” or “0 of 1” in red ink at the bottom of each question after submitting it for grading.

mp3bu

The only questions I got wrong were 3 and 6, both of which have been discussed here. They are all from the online ethics test, which doesn’t give the correct answer if you get the question wrong. Good thread to examine those questions you did get wrong.
Question #1:
I. Members should outline known limitations of their analysis.
II. Reports should be supported by background and supporting information, and this information should be available to interested parties.
III. Members must include all relevant factors in research reports.
A. I and II.
B. I, II, and III.
C. I and III.
D. II and III.
I answered “A” based on the understanding that “all relevant factors” is such a subjective and broad reaching assumption. I don’t know how reasonable or even enforceable such a substandard would be, assuming that all obvious relevant factors have been included. I still think it is “A”.
Question 6:
Which of the following is LEAST LIKELY to be considered a “material” piece of information regarding a company:
A. Changes in company management.
B. A government report of economic trends affecting a company.
C. Loss of a customer representing a significant portion of a company’s gross sales.
D. A former CFO of the company predicting long-term decline in the company’s stock.
I am a little confused here. Personally I think government statistics is a relevant analytical tool, but is not really material to a specific company per se. Its hard to discount economic trends given there significance, but in this question, the other three options would no doubt provide a reasonable assumption of a change in the perception of the value of the companies stock.
————————————————————————————————————
I could be wrong on both of these. Thoughts???