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Basic Question 1 of 4
Beneish model can be used to check if:
B. A company's operating cash flow is sustainable.
C. A company's not going to meet its debt obligations.
A. A company is likely to be a manipulator of its earnings.
B. A company's operating cash flow is sustainable.
C. A company's not going to meet its debt obligations.
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I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz
Learning Outcome Statements
describe the concept of sustainable (persistent) earnings;
describe indicators of earnings quality;
explain mean reversion in earnings and how the accruals component of earnings affects the speed of mean reversion;
CFA® 2025 Level II Curriculum, Volume 2, Module 14.