Skip to content

CFA Level I · CFA Level I Exam · Guidance for Standard I: Professionalism

A portfolio manager learns that a colleague is violating securities regulations that govern the firm's activities. Under Standard I(A), the manager's most appropriate action is to:

The manager should dissociate from the violation and not knowingly participate or assist in it. Standard I(A) requires members and candidates to dissociate from any violation of applicable laws, rules, or regulations, so passive continuation or waiting for a regulator is inadequate.

  1. Acontinue working on the account but not benefit from the violation
  2. Bdissociate from the violation and not knowingly participate or assist in itCorrect
  3. Cwait until a regulator investigates before taking any action

Explanation

Standard I(A) states that members must not knowingly participate or assist in and must dissociate from any violation of laws, rules, or regulations. Continuing to work on the account or waiting passively is insufficient. Seeking compliance or legal guidance is consistent with this.

Did you get it right without looking?

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

Practise Guidance for Standard I: ProfessionalismFree diagnostic mock

More Guidance for Standard I: Professionalism questions