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CFA Level II Exam · Guidance for Standard V: Investment Analysis, Recommendations, and Actions

Standard V(C): Record Retention in CFA Level II

Updated 7 October 2026

Standard V(C) requires members and candidates to develop and maintain appropriate records that support their investment analyses, recommendations, actions and client communications. The Handbook recommends keeping records for at least seven years, and you follow a longer legal period if one applies. Records belong to the firm, not to you, so you keep no copies when you leave.

Understand Standard V(C): Record Retention

Standard V(C) is the last part of Standard V. Standard V(A) asks you to have a reasonable basis for your work. Standard V(B) asks you to communicate it clearly. Standard V(C) asks you to keep proof of both. If a client, regulator or your employer asks why you made a call, you must be able to show what you did and what you said.

The records covered are broad. They include research notes, models and spreadsheets, the data and sources behind them, the recommendations you made, the actions taken in client accounts, and communications with clients and prospects. Communications include emails, letters, meeting notes and, in the form the firm uses, electronic messages. Records can be paper or electronic.

The Handbook recommends keeping records for at least seven years. If local securities law or regulation requires a longer period, you follow the longer period. If the legal period is shorter than seven years, the recommended seven years still applies. Local law does not override it.

The records are the property of the firm. This matters most when you change jobs. When you leave, you must not take originals or copies of records, such as models, research files or client communications, without the firm's permission. You can rely on your own memory and general skills, but you cannot carry away the firm's documents. The reverse also applies. If you join a new firm, you create fresh records there, based on public information and your own recollection, not on files from the old firm.

If you are an independent practitioner, you are the firm. You must keep your own records for the same period. Supervisors should also make sure the firm has a clear retention policy and that records stay accessible and secure.

Key formulas to remember

Core duty
Develop and maintain appropriate records that support analyses, recommendations, actions and communications
Applies to both internal work and client-facing communications.
Retention period
Keep records for at least 7 years; if law requires a longer period, follow the longer period
Seven years is the recommended minimum. A shorter legal period does not reduce it. A longer legal period is followed.
Ownership
Records created as part of employment = property of the firm
On leaving, do not take originals or copies without the firm's permission.
Independent practitioners
No firm = member keeps own records for the same period
Same seven-year recommended minimum applies.
Format
Paper or electronic records are both acceptable
Records must be retained and retrievable, so format does not remove the duty.

How to solve Standard V(C): Record Retention questions

Most Standard V(C) questions test whether the record was kept, for how long, and who owns it. Use the same sequence each time.

  1. 1Read the vignette and underline what record is involved: research, model, recommendation, client communication, or trade action.
  2. 2Decide whether the question is about keeping records, the retention period, or taking records when leaving.
  3. 3If it is about the period, compare any legal period with the recommended seven years. Follow the longer of the two. A shorter legal period does not cut the seven years.
  4. 4If a member is leaving a firm, ask whether the records belong to the firm. Taking copies without permission is a violation.
  5. 5Check whether the member is independent. If so, they must keep their own records.
  6. 6Check the format. Electronic records and messages count just as paper does.
  7. 7Name the Standard, V(C), and match the answer to the conduct: compliant or violating.
  8. 8Eliminate options that say records can be discarded early because the client or the analyst no longer needs them.

Quickest way: Three-question check

When to use it: Use when time is short and the vignette involves records, a departure from a firm, or a retention period.

  1. Who owns it? Firm records stay with the firm.
  2. How long? At least seven years is the recommended practice; follow a longer period if law requires it.
  3. Is it supportive? Records must back up analysis, recommendations, actions and communications.
  4. If an option has the analyst taking files, deleting early or keeping nothing, it is almost certainly the violation.

Common mistakes in Standard V(C): Record Retention

  • Treating seven years as a legal rule that always applies.

    The number is easy to remember and is stated firmly.

    Fix: Remember it is the Handbook's recommended minimum practice. If local law requires a longer period, follow the longer period.

  • Thinking a shorter local regulation overrides the seven-year figure.

    Students assume local law always comes first.

    Fix: Seven years is the recommended minimum even when the legal period is shorter. Follow the longer of the two, and always follow a longer legal period.

  • Believing the analyst owns the models and research they built.

    The analyst did the work and feels it is personal.

    Fix: Work done as part of employment belongs to the firm. You may not take copies on leaving without permission.

  • Ignoring electronic communications.

    Students picture filing cabinets.

    Fix: Emails and other electronic records that support recommendations and client communications must be kept too.

  • Assuming independent practitioners are exempt because there is no firm.

    The vignette has no compliance department.

    Fix: An independent practitioner is responsible for their own records for the same period.

  • Confusing V(C) with V(A) or V(B).

    All three sit under Standard V.

    Fix: V(A) is the reasonable basis, V(B) is communication, V(C) is keeping the proof. Look for the word records.

Worked examples

Example 1

Anika Rao is a portfolio manager at a firm in a jurisdiction that requires client communication records to be kept for five years. Her firm's policy is to delete research files after four years. A client dispute arises over a recommendation made six years ago. The firm has no record of it. (1) Did Rao's firm meet Standard V(C)? (2) What should the firm have done?

Show the solution
  1. Identify the issue: retention period for records supporting recommendations and communications.
  2. Compare the periods: local law five years, firm policy four years, Handbook recommended minimum seven years.
  3. Follow the longer of the legal period and the recommended period. Seven years is longer than five, so the firm should have kept records for at least seven years.
  4. The four-year deletion policy falls short of both the five-year legal period and the seven-year recommended practice.
  5. The disputed record is six years old. That is within seven years, so it should still have been retained. Its loss is a failure under Standard V(C).

Answer: (1) No. The firm did not meet Standard V(C). Its four-year deletion policy falls short of both the five-year legal period and the recommended seven years, and the six-year-old record should have been retained. (2) The firm should have kept records for at least seven years and set its retention policy accordingly.

Example 2

Kofi Mensah is leaving his research firm to join a competitor. Before leaving, he emails himself the valuation models he built for the firm's coverage list and a file of notes on client meetings, so he can reuse them. He plans to build new reports at the new firm from public information. (1) Does this violate Standard V(C)? (2) What may Mensah legitimately do?

Show the solution
  1. Identify the records: valuation models and client meeting notes created during employment.
  2. Decide ownership: they belong to the firm.
  3. Check permission: Mensah has not asked for it, and copying is the issue.
  4. Conclude that taking copies without permission violates the duty to treat records as firm property.
  5. Decide what is allowed: he may use public information and his own general knowledge and skills at the new firm, and build new models there.

Answer: (1) Yes. Emailing the models and meeting notes to himself without the firm's permission violates the Standard, since the records belong to the firm. (2) He may rely on public information and his own memory and skill to create new records at the new firm.

Exam tips

  • Look for the keywords records, retention, delete, files and leaving. They signal Standard V(C).
  • If an option has records kept for less than seven years, treat it with suspicion, even when it cites a shorter legal period. Seven years is a recommended practice, so read the exact wording.
  • If law demands a period longer than seven years, the longer period is the correct answer.
  • On departure questions, the correct choice normally has the member leaving the records behind and building fresh work from public information.
  • Do not choose an answer that says the format matters. Paper and electronic records both count.

Standard V(C): Record Retention: frequently asked questions

How long must I keep records under CFA Standard V(C)?

The Handbook recommends keeping records for at least seven years. If local law or regulation requires a longer period, you follow the longer period. A shorter legal period does not reduce the recommended seven years.

Do records belong to me or to my firm?

Records created as part of your work belong to the firm. You should not keep or copy them for your own use. This matters most when you leave the firm.

Can I take my models and research when I change firms?

Not without the firm's permission. You can use public information and your own general knowledge and skills at the new firm, but you should not carry away the old firm's models, files or client communications.

What counts as a record under Standard V(C)?

Anything that supports your analyses, recommendations, actions and communications with clients and prospects. This includes research notes, models, data sources, emails and trade records, in paper or electronic form.