Answer: Statement 2

## Explanation According to the Global Investment Performance Standards (GIPS): **Statement 1: A firm must perform verification to claim compliance with the GIPS standards.** - **Incorrect.** Verification is **recommended** but **not required** for GIPS compliance. A firm can claim compliance without verification. **Statement 2: Verification ensures accuracy of specific composite presentations.** - **Correct.** Verification provides assurance on whether: 1. The firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis 2. The firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS standards **Statement 3: Verification is performed with respect to an entire firm.** - **Incorrect.** Verification is performed on a **firm-wide basis**, not just on specific composites. It covers the entire firm's processes and procedures for compliance with GIPS standards. **Key Points:** - Verification is voluntary but highly recommended - It provides assurance about the firm's overall compliance processes - It's conducted at the firm level, not just on specific composites - Firms can claim GIPS compliance without verification, but must disclose if they have not been verified

Author: LeetQuiz .