Exam CFA® Level 1 topic 1 question 78 discussion

Actual exam question from Test Prep's CFA Level 1

Question #: 78
Topic #: 1

[All CFA Level 1 Questions]

When dealing with charitable organizations, the fiduciary must consider all of the following, except:

A. general economic conditions.
B. the charity's present and anticipated financial requirements.
C. investigation of supervisory activities once violation is known to have occurred.
D. long and short-term institutional needs in carrying out the charitable purpose.
E. expected total return on its investments.
F. trends in security price levels. C

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Suggested Answer: Explanation 🗳️
As fiduciaries for charitable organizations, members must consider: long and short-term institutional needs in carrying out the charitable purpose, the charity's present and anticipated financial requirements, expected total return on its investments, trends in security price levels and general economic conditions.
Investigation of violations involving supervisors is a compliance procedure under Standard III (E), not under Standard IV (B.1), which deals with Fiduciary Duties.

by KAla7223 at Jan. 30, 2023, 7:03 a.m.

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KAla7223

2 years, 6 months ago

Selected Answer: C

C. investigation of supervisory activities once violation is known to have occurred.

upvoted 1 times

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