Answer: Yes, the Standard relating to additional compensation arrangements

## Explanation **Correct Answer: C** - Yes, the Standard relating to additional compensation arrangements **Detailed Analysis:** 1. **Standard IV(B) - Additional Compensation Arrangements:** This Standard requires members and candidates to obtain written consent from their employer before accepting compensation, gifts, or benefits that could reasonably be expected to create a conflict of interest with their employer. 2. **Key Points in this Scenario:** - Mehta received free tickets to a sold-out opera opening night from a large investor in her fund - The tickets have significant value (sold-out event, opening night) - The gift was offered as a reward for the fund's excellent performance - Firm policy requires disclosure of monetary compensation from clients - Mehta only accepted the tickets, not the cash 3. **Why Mehta Violated the Standard:** - The opera tickets constitute a "benefit" under Standard IV(B) - The benefit could reasonably create a conflict of interest (the investor might expect preferential treatment) - Mehta should have obtained written consent from her employer before accepting the tickets - The fact that she didn't accept the cash compensation is irrelevant - the tickets themselves are valuable compensation - Even if firm policy only explicitly mentions monetary compensation, the CFA Standards require disclosure of all compensation arrangements that could create conflicts 4. **Why Not the Other Options:** - **Option A (No):** Incorrect because Mehta did violate Standard IV(B) - **Option B (Fair Dealing):** Incorrect because Standard III(B) - Fair Dealing relates to treating all clients fairly when making investment recommendations, not compensation arrangements **Conclusion:** Mehta violated Standard IV(B) - Additional Compensation Arrangements by accepting valuable opera tickets from an investor without obtaining written consent from her employer, as this could create a conflict of interest.

Author: LeetQuiz .