
Explanation:
Kato's actions are not consistent with the Standard relating to responsibilities of supervisors. Here's why:
Under this standard, supervisors must:
Kato should have taken additional measures such as:
The fact that Kato took "no further steps" while waiting for the investigation outcome violates the requirement to prevent repeated violations.
Ultimate access to all questions.
No comments yet.
Hiroshi Kato, CFA, is a supervisor at an investment management firm. Kato learns one of his employees may have violated the Standards. Kato promptly initiates an investigation to determine the extent of the potential wrongdoing and concludes that the employee violated the Standards. Kato then reports the misconduct up the chain of command and warns the employee to cease the activity. While waiting for the outcome of the investigation, Kato takes no further steps to prevent repeated violations.
Are Kato's actions consistent with the Standard relating to responsibilities of supervisors?
A
Yes
B
No, because Kato should take steps to ensure the violation is not repeated
C
No, because Kato should report the violation to the Professional Conduct Program