Answer-first summary for fast verification
Answer: Ensure that the firm discloses to clients any rebates received from service fees charged by certain mutual fund classes.
**Explanation:** - **Option A** is incorrect. Standard VI(A) requires members to disclose conflicts of interest, such as serving on a board, but does not mandate rejecting the position outright. Proper disclosure allows clients to assess the objectivity of the advice. - **Option B** is correct. Standard VI(A) emphasizes the importance of disclosing arrangements where the firm benefits directly from investment recommendations, such as rebates from mutual fund service fees. This ensures transparency about costs and benefits for clients. - **Option C** is incorrect. While disclosure of outstanding options is required under Standard VI(A), placing the company on a restricted list and issuing factual information is unnecessary if proper disclosure is made.
Author: LeetQuiz Editorial Team
Ultimate access to all questions.
No comments yet.
According to the Standard VI(A) regarding disclosure of conflicts, a member is required to:
A
Decline a board position in a company for which the member's firm intends to initiate a research report.
B
Ensure that the firm discloses to clients any rebates received from service fees charged by certain mutual fund classes.
C
Add a company to a restricted list and provide factual information about it if the member's firm holds options on the company's shares.