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Answer: Both Procedure 1 and Procedure 2, as both are necessary for full compliance with the Standard on Suitability.
**Explanation:** The correct answer is **C** because both procedures are essential for compliance with Standard III(C) (Suitability). - **Procedure 1** ensures that an investor's objectives and constraints are reviewed annually (or more frequently if needed) to reflect any changes in the client's circumstances. This aligns with the requirement to maintain and update client profiles periodically. - **Procedure 2** emphasizes the importance of incorporating performance measurement benchmarks when developing an investment policy statement. This ensures the investment strategy is tailored to the client's needs and goals. Together, these procedures uphold the ethical and professional standards by preventing violations of the Code of Ethics and Standards of Professional Conduct.
Author: LeetQuiz Editorial Team
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Which of the following procedures is recommended for compliance with the Standard on Suitability?
A
Procedure 1 only, which involves reviewing an investor's objectives and constraints annually unless circumstances necessitate more frequent reviews.
B
Procedure 2 only, which requires considering performance measurement benchmarks when formulating an investment policy statement.
C
Both Procedure 1 and Procedure 2, as both are necessary for full compliance with the Standard on Suitability.
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