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Basic Question 2 of 8

Frank should disclose to clients about companies he recommends if ______

I. he has an underwriting relationship with the company.
II. he is acting as the company's market maker.
III. he has a 30% ownership of the company.
IV. he is a director in the company.

User Contributed Comments 6

User Comment
ggupta yes..anything which is expected to raise concern about the conflict on Interest..provide appropriate disclosures
JimM What about a mere 25% ownership in the company?
bundy Any ownerhip
oncewerepirates What about a mere 20% ownership in the company?
johntan1979 Even if you have 0.001 share ownership.

The CFA Standard VI(A) does not specify the percentage ownership, so it means ANY amount of ownership.
MapherRdz Yeah, any ownership must be disclosed not only if you have equal or more than the 30%
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I used your notes and passed ... highly recommended!
Lauren

Lauren

Learning Outcome Statements

demonstrate the application of the Code of Ethics and Standards of Professional Conduct to situations involving issues of professional integrity

recommend practices and procedures designed to prevent violations of the Code of Ethics and Standards of Professional Conduct

identify conduct that conforms to the Code and Standards and conduct that violates the Code and Standards

CFA® 2025 Level I Curriculum, Volume 6, Module 3.