Skip to content

CFA Level I · CFA Level I Exam · Guidance for Standard III: Duties to Clients

A firm offers a premium service tier with more personal, in-depth client contact for higher fees. Which arrangement is most consistent with Standard III(B)?

The consistent arrangement is disclosing the service tiers to all clients and prospects and making them available to everyone, with no disadvantage to other clients. Differentiated service is permitted, but selective offering or giving premium clients priority on opportunities breaches fair dealing.

  1. APremium clients receive the service and the tier is offered only to clients the adviser selects
  2. BPremium clients receive all new investment opportunities first, ahead of other clients
  3. CThe tiers are disclosed to all clients and prospects, are open to everyone, and do not disadvantage other clientsCorrect

Explanation

Different service levels are allowed if they do not disadvantage or negatively affect clients, are disclosed to clients and prospective clients, and are available to everyone rather than offered selectively. Options A and B fail these conditions.

Did you get it right without looking?

One question tells you little. A timed set on Guidance for Standard III: Duties to Clients shows your real accuracy, how long you take and where you lose marks.

Practise Guidance for Standard III: Duties to ClientsFree diagnostic mock

More Guidance for Standard III: Duties to Clients questions