avoid situational influences

oversimplify decision making

consider more factors than when using an ethical decision-making approach

Making legally required disclosures in marketing materials

Trading while in possession of material nonpublic information

Disclosure by an employee of his or her own company’s dishonest activity

include a pre-determined, uniform sequence

focus exclusively on confirmable facts and relationships

help avoid a decision that has unanticipated ethical consequences

Firms should disclose to clients the personal investing policies and procedures established for their employees.

Prior approval must be obtained for the personal investment transactions of all employees.

For confidentiality reasons, personal transactions and holdings should not be reported to employers unless mandated by regulatory organizations.

Send Murdock the information because disclosure would benefit the client.

Not send Murdock the information to preserve confidentiality.

Send Murdock the information, provided Bronson promptly notifies the trustees.

Violated the Standards by failing to distinguish between facts and opinions in his recommendation.

Violated the Standards because he did not have a reasonable and adequate basis for his recommendation.

Was in full compliance with the Standards.

Informing all people in the firm in advance that a recommendation is to be disseminated.

Distributing recommendations to institutional clients prior to individual accounts.

Minimizing the time between the decision and the dissemination of a recommendation.

Turn down the additional compensation because it will result in conflicts with the interests of other clients’ accounts.

Turn down the additional compensation because it will create undue pressure on her to achieve strong short-term performance.

Obtain permission from her employer prior to accepting the compensation arrangement.

Violated the Standards in voting the shares in the manner requested by Jones but not in directing trades to the brokerage firm.

Did not violate the Standards in voting the shares in the manner requested by Jones or in directing trades to the brokerage firm.

Violated the Standards in directing trades to the brokerage firm but not in voting the shares as requested by Jones.

Neither statement violated the Code and Standards.

Only statement I violated the Code and Standards.

Only statement II violated the Code and Standards.

Accept the expense-paid trip and write an objective report.

Pay for all travel expenses, including costs of meals and incidental items.

Accept the expense-paid trip but disclose the value of the services accepted in the report.

Disclosure will allow the client to request discounted service fees.

Disclosure will help the client evaluate any possible partiality shown in the recommendation of services.

Disclosure means advising a prospective client about the referral arrangement once a formal client relationship has been established.

Townsend did not violate the Code and Standards.

Townsend violated the Code and Standards by soliciting donations from her clients through the newsletter.

Townsend violated the Code and Standards by not getting approval of the organization before soliciting her clients.

Real Estate.

Derivatives.

Legal and Ethical Considerations.

replicating performance.

properly defining the firm.

documenting firm policies and procedures used in establishing and maintaining compliance with the Standards.

is a personal view of acceptable behavior.

encompasses current “best practices.”

specifies a minimum level of acceptable conduct.

social pressure.

large financial rewards.

a lack of ethical principles.

is considered a lower standard.

often involves more judgment.

includes compliance with all laws and regulations.

lead to higher profits.

avoid any unintended ethical consequences of decisions.

balance the interests of various stakeholders.

Maintain and improve their professional competence

Do not act or cause others to act on material nonpublic information.

Distinguish between fact and opinion when presenting investment analysis.

consultants who serve their existing and prospective clients

firms that issue securities and serve investment management firms.

investment management firms and serve their existing and prospective Clients.

have been managed by the firm for the full performance reporting period.

be selected immediately after the last business day of the period for which the composite’s performance will be presented.

include all fee-paying, discretionary portfolios that are managed accordingto the same strategy, mandate, or investment objective.

may be performed on single composites.

is required for a firm to claim GIPS compliance.

requires the verification report to be issued for the entire firm.

document the procedures and policies they use to ensure GIPS compliance.

clearly disclose any calculations or other aspects of a presentation that are noncompliant with GIPS.

calculate total firm assets as the fair value of all fee-paying discretionary portfolios managed by the firm.

Investment firm that has been in existence for less than five years.

Regional branch of an investment management firm marketed under the name of its parent.

Entity registered with the national regulator that oversees its investment management activities.

may not do so because GIPS do not permit exceptions or partial compliance.

must establish a subsidiary in a location where local law does not conflictwith GIPS.

must comply with local regulations and disclose the nature of the conflict in the presentation.