Self-​disclosure by M&C on their annual Professional Conduct Statements

Written complaints about a M&C's professional conduct that are received by the A. Knowledge of the Law
Professional Conduct staff

Circumstances that can prompt and inquiry B. Independence and Objectivity

Evidence of misconduct by a member or candidate that the Professional Conduct staff I. Professionalism
received through public sources
C. Misrepresentation

Report by a CFA exam proctor of a possible violation during the examination

D. Misconduct

Analysis of exam materials and monitoring of social media by CFA Institute

A. Material Nonpublic information
II. Integrity of Capital Markets
B. Market Manipulation

A. Loyalty, Prudence and Care

Request an explanation from the subject M&C
The Professional Conduct staff
B. Fair Dealing
Interview the subject M&C, the complainant or other third parties, and/or collect
Process of an inquiry
documents and records relevant to the investigation
Duties to Clients C. Sustainability

D. Performance Presentation

that no disciplinary sanctions are appropriate

E. Preservation of Confidentiality
Reading 57
to issue a cautionary letter The Professional Conduct staff decide
Standards of Professional Conduct A. Loyalty

to discipline the M&C

Duties to Employers B. Additional Compensation Arrangements

C. Responsibility of Supervisors

Act with integrity, competence, diligence, and respect and in an ethical manner with the
public, clients, prospective clients, employers, employees, colleagues in the investment A. Diligence and Reasonable Basis
profession, and other participants in the global capital markets
Investment Analysis, Recommendations, and Actions B. Communication with Clients and Prospective Clients
Place the integrity of the investment profession and the interests of clients above their own
personal interests C. Record retention
Six components of the Code of Ethics

Use reasonable care and exercise independent professional judgment when conducting A. Disclosure of conflicts
investment analysis, making investment recommendations, taking investment actions, and
engaging in other professional activities
Conflicts of Interest B. Priority of Transactions

Promote the integrity and viability of the global capital markets for the ultimate benefit of
society C. Referral Fees

Practice and encourage others to practice in a professional and ethical manner that will A. Conduct as members and candidates in the CFA program
reflect credit on themselves and the profession Responsibilities as a CFA Institute Member or CFA Candidate
B. Reference to CFA Institute, the CFA Designation, and the CFA programm
Maintain and improve their professional competence and strive to maintain and improve
the competence of other investment professionals
 Must not knowingly make any misrepresentations relating to investment analysis,
Must not knowingly participate or assist in and dissociate from any violation The standard
recommendations, actions, or other professional activities

In the event of conflict, must comply with the more strict law, rule, or regulation The standard Qualifications, Services, Characteristics of an investment, Performance records

Must understand and comply with all applicable laws, rules, or regulation Investment practice Must not represent external managers' investment practices as their own

In the event of conflict, M&C must follow the stricter of the applicable law or the Code and Relationship between the Code and Standards and Applicable Law Exercise care and diligence when incorporating third-​party information
Standards

Should not misrepresent the success of their performance record by presenting

If M&C are directly involved in or associated with violations, M&C take full responsibility benchmarks that are not comparable to their strategies

Performance reporting
Prevent the person committing the violation through discussing Discuss with clients on a continuous basis the appropriate benchmark and
fees calculations
Bring violations to attention in case of unsuccessful discussion
Compliance requirements for M&C Take reasonable steps to provide accurate and reliable security pricing information to
Step away from violations clients on a consistent basis
When M&C are not directly involved but aware of Participation in or Association with Violations by Others
Guidance
violations conducted by employers or clients
Guidance One form of communication
Encouraged to report potential violation
Social media
Should provide the same information
A. Knowledge of the law C. Misrepresentation

Knowledge of the product's markets and places of origination Should not knowingly omit inputs used in models and processes

Understanding of applicable laws and regulations related to the product's markets and Investment Products and Applicable Laws Omission Should not present modeled outcomes as facts
places of origination and review whether associated firms abide by laws and regulations
Encourage firms to develop strict policies for composite development to prevent cherry
Due diligence when transacting cross-​border business picking

Stay informed In the case of distributing third-​party, outsourced research, M&C can use and distribute
Plagiarism
these reports as long as they do not represent themselves as the author of the report

Review procedures
Research reports prepared are property of the firm
Work completed for Employer
Maintain current files
M&Cs are allowed to use the previously conducted researches but cannot release under
Recommended procedures
their own names
Legal counsel

Factual presentation
Dissociate

Qualification summary
Encourage firms to: Develop/adopt a code of ethics; Provide information on applicable laws;
Establish procedures for reporting violations
Recommended procedures Verify outside information

Maintain webpages
Standard I: Professionalism

Plagiarism policy

Must use reasonable care and judgment to achieve and maintain independence and
objectivity in professional activities

The standard
Must not offer, solicit, or accept any gift, benefit, compensation, or consideration that
reasonable could be expected to compromise their own or another's independence and Must not engage in any professional conduct involving dishonesty, fraud, or deceit
objectivity The standard
Must not commit any act that reflects adversely on their professional reputation, integrity,
Gifts from clients: Must disclose to employer before receiving or competence

Benefits from clients and other parties

Gifts and benefits not from clients but from other entities: Can only accept modest gifts, D. Misconduct Any act that involves lying, cheating, stealing, or other dishonest conduct is a violation of
reject any offer that could be expected to threaten their independence and objectivity Guidance this standard if the offense reflects adversely on a member's or candidate's professional
activities

True opinions are reflected

Code of ethics

Investment-​banking relationships
Recommended procedures Firm should adopt List of violations
Internal pressures
The supervisor
Employee references

Benefits (gifts, travelling tickets,

favors, job referrals, etc.

External pressures B. Independence and Objectivity

From buy-​side clients General guidance
Free of biases from internal or external pressures Potential biases when preparing
From public companies report and making recommendations

Fund managers relationships

Credit rating agency opinions

Other pressures
Issuer-​paid research

Performance measurement and attribution

Language is clear and unambiguous

Maintain and improve their professional competence and strive to maintain and improve
Seeking financial support from others
the competence of other investment professionals
from events

Protect the integrity of opinions

Create a restricted list

Restrict special cost arrangements

Limit gifts
Recommended procedures
Restrict investments

Review procedures

Independence policy

Appointed officer
 M&C have a duty of loyalty to their clients and must act with reasonable care and exercise
prudent judgment

The standard

M&C must act for the benefit of their clients and place their clients' interests before their
employer's or their own interests

Act with care, skill and diligence

Prudence Following the investment parameters set forth by the client

Balancing risk and return

Fiduciary: Comply with any legally imposed fiduciary duty

M&Cs' responsibility to clients
Other types of relationship: Fulfill the obligations outlined explicitly or implicitly in the client
agreements to the best of their abilities and with loyalty, prudence and care

Identifying the Actual investment client

Guidance

Follow any guidelines set out by client for the management of assets
A. Loyalty, prudence and care Developing the client's portfolio (IPS)
Make investment decisions in context of total portfolio

Use brokerage of clients, provide research

Soft commission policies Violation: Investment manager uses client brokerage to buy research services that benefit
the investment manager

Directed brokerage: a client will direct a manager to use brokerage to purchase G&S → Not
violation, should disclose when not "best execution"

Proxy voting policies cost-​benefit analysis

Disclose account info regularly

If uncertain about appropriate course of actions with respect to clients, should disclose the
matter to clients

Recommended procedures
Follow firm policies

Place client interests first

Must deal fairly and objectively with all clients when providing investment analysis, making
The standard investment recommendations, taking investment action, or engaging in other professional
activities

Fairly: Not discriminate against any clients when disseminating investment

Fairly versus Equally recommendations or taking investment action

Equally: Reach all clients at exactly the same time when disseminating investment
M&Cs who possess material nonpublic information that could affect the value of an recommendation
investment must not act or cause others to act on the information
The standard
Ensure all clients have a fair opportunity to act on

Its disclosure would likely have an impact on the price of a security

Investment recommendations Material changes should be communicated to all current clients
Material information
If reasonable investors would want to know the information Guidance
before making an investment decision Clients who don't know changes (and therefore place orders contrary to a current
recommendation) should be advised of the changed recommendation before the order is
accepted
Information is considered nonpublic until it has been available to the public

Treat all clients fairly in light of their investment objectives & circumstances
Not a violation when used for due diligence Nonpublic information B. Fair Dealing
Investment actions
The use of non-​public information
Disclose to clients & prospects written allocation procedures
Violation when used for other purposes

Disclosed to clients/prospective client

Public information + non-​material non-​public information
= Investment conclusion
Guidance Different levels of services Available to everyone
Mosaic theory
Analysts are free to act on this collection of information
Must not disadvantage other clients

Analysts should save and document all their research

Limit the number of people involved in report dissemination

Should verify that info obtained from social media is publicly

available from another source Shorten the time frame between decision and dissemination
Social media

A. Material nonpublic information Develop firm policies Publish guidelines for pre-​dissemination behavior
Complete all appropriate regulatory filings related to information
distributed through social media platforms
Recommended procedures Maintain a list of clients and their holdings
May provide compensation to individuals for their insights
without violating this standard Using industry expert Develop, document, and disclose trade allocation procedures

Are ultimately responsible for ensuring that they are not

requesting or acting on confidential information Establish systematic account review

Well-​known's analyst's report may be material but not insider information Investment research report Disclose levels of service

Achieve public dissemination The standard Type something

Firm should issue press releases C. Suitability

Standard II: Integrity of Financial Market Standard II & III Standard III: Duties to Clients return requirements
Firewall elements

Physical separation of departments Investment policy statement (IPS) risk tolerance

Prevent personnel overlap Recommended procedures Developing investment contraints

Reporting system at least annually

Update IPS

Personal trading limitation Guidance prior to material changes

Communication records between departments Managing to an Index or Mandate Be sure investments are consistent with the stated mandate

Communication to all employees Refrain from making trade

Unsolicited trading requirests

Must not engage in practices that distort prices or artificially inflate trading volume to Seek affirmative statement from client that suitability is not a consideration
The standard
mislead the market
Diversification on the basis of information actually provided by the client
dissemination of false/misleading info
Information based manipulation Client identification
rumors Guidance
Type something
When formulating IPS, consider Investor objectives
Transactions that artificially distort prices or volume Transaction based manipulation

B. Market manipulation Recommended procedures Investor constraints

Legitimate trading strategies
Regular updates
Transactions done for tax purposes Not violation
Suitability test policies
Intent of action is critical to determining whether it is a violation or not
When communicating investment performance information, members and candidates must
The standard
make reasonable efforts to ensure that it is fair, accurate, and complete

Must provide credible performance information

Must not state or imply that clients will obtain rate of return generated in the past
D. Performance presentation
Guidance
Research analysts promoting the success of their recommended must be ensure that their
claims are fair, accurate, complete

If the presentation is brief, must make available to clients the detailed info, on request

Recommended procedures Apply Global investment performance standards (GIPS)

The standard Type something

E. Preservation of confidentiality

Current clients

Status of client Former clientsType something

Prospective clients

Must disclose when required by law

Guidance Comply with applicable laws

Consult with compliance department before disclosing when in doubt

aware of possible accidental disclosure

Electronic information
understand policies of employers

Encourage to cooperate with investigations by CFA Institute Professional Conduct Program

Recommended procedures
Understand and follow firm's electronic information communication and storage
procedures
 must not accept gifts, benefits, compensation, or consideration that competes with or might
The standard reasonably be expected to create a conflict of interest with their employer’s interest unless
they obtain written consent from all parties involved

B. Additional compensation arrangements

Obtain written consent from employer before accepting compensation or other benefits
Guidance
must act for the benefit of their employer and not deprive their employer of the advantage from third parties
of their skills and abilities, divulge confidential information, or otherwise cause harm to
their employer
The standard Recommended procedures Should make an immediate written report to their employers

Must not engage in conduct that harms the interests of the employer
Employer responsibility
Not require M&C to subordinate important personal and family obligations to their work

Abstain from independent competitive activity that could conflict with employer's interests must make reasonable efforts to ensure that anyone subject
to their supervision or authority complies with applicable laws, rules, regulations, and
The standard the Code and Standards
the types of services
Independence practice
not relieve supervisory responsibility
the expected duration of the service Provide notification to employer, obtain consent from employer in advance
Delegation
instruct subordinates methods to prevent and detect violations
the compensation for the services

Make reasonable efforts to detect violation of laws, rules, regulations, and Codes &
Continue to act in employer's best interest when planning to leave Standards
Detection procedures
Must
Erase/return to employer the work performed on behalf of firm unless receiving written Leaving an employer still not detect: not violated
permission from firm Guidance

meet industry standards

Contact existing/potential clients prior to leaving for soliciting their business Must not
Standard IV: Duties to employers
regulatory requirements
is acting contrary to employer's interest to comply with duties to the market and clients
Must understand what constitutes an adequate compliance system
requirements of the Code & Standards
integrity of capital market
Whistleblowing A. Loyalty the circumstances of the firm
clients permitted only if the intent is clearly aimed at protecting

Guidance Make reasonable efforts to see that appropriate compliance procedures are established,
not for personal gain documented, communicated to covered personnel
C. Responsibilities of Supervisors
Compliance procedures
employees vs. independent contractors promptly initiate investigation, from employee's statements

depend on: working hours, facilities, etc. Nature of employment reporting misconduct

follow the terms of agreement warning the employee to cease the activity
In case of employee's violation
should ensure the details in noncompete agreement are clear and fully explained before Competition policy take steps to ensure that the violation will not be repeated
signing

place limits on employee's activities

follow the resignation process when leaving the employer Termination policy

increase the monitoring of employee's activities

should be aware of their firm's policies of whistleblowing Incident-​reporting procedures

Bring an inadequate compliance system to senior managers' attention & recommend

part time Recommended procedures corrective action
Inadequate procedures

full time If clearly can't discharge responsibilities because of absence of compliance system, decline
classification structure in writing to accept responsibilities
outside contractor Employee classification
Enforcement of non-​investment-​related policies
etc.
Firm: adopt a code of ethics
policies apply to each employee class
Adequate compliance procedures
Recommended procedures
Implementation of Compliance Education and Training

Establish and Appropriate Incentive Structure

 Exercise diligence. independence, and thoroughness in analyzing investments, making
investment recommendations, and taking investment actions The standard

Have a reasonable and adequate basis, supported by appropriate research and

investigation, for any investment analysis, recommendation, or action

because clients expect the advisers to have more information and knowledge than they do
Diligence and Reasonable basis
minimize unexpected downside events

Secondary research Must make full and fair disclosure of all mattersthat could reasonably be expected to impair
The standard their independence and objectivity or interfere with respective duties to their clients,
prospective clients, and employer
Third-​party research Using secondary or third-​party research

Must ensure that such disclosure are prominent, and are delivered in plain language, and
Must make reasonable & diligent efforts to determine whether the research is sound
communicate the relevant information effectively

Must understand the assumptions and limitations

Best practice is to avoid conflicts of interest when possible
Using quantitatively oriented research
Must understand how the results were used in the decision-​making process
clients/potential clients
Guidance
If not → disclose to
technical aspects of the products they provide
employers
Must understand
the source, time horizon of data used as inputs Create new quantitatively oriented research
Disclosure must be prominent, made in plain language, in a manner to effectively
communicate the info to clients
Need to test the model
A. Diligence and Reasonable basis
All matters may impair objectivity
Must review managers as deligently as they review individual funds and securities Selecting external advisers and subadvisers
A. Disclosure of conflicts between M&C and issuer
conclusions of the group report represent the consensus of the group Relationships
between employer and issuer
may be not the views of the M&C although his/her name is included on the report Group research
Guidance
Disclosure to clients Cross-​department conflicts
believe that the consensus opinion has a reasonable and adequate basis and is
independent and objective → need not dissociate from the report even if it does not reflect
Ownership of stock
his or her opinion

between duties to clients and to SHDs of the company may receive stock compensation
Establish a policy requiring reports/recommendations reasonable and adequate
Conflicts as a director
opportunity to receive MNI
establishes the due diligence procedures
Develop detailed written guidance
Any potential conflict situation
establishes minimum levels of scenario testing of all computer-​based models
Recommended procedures
Must comply with employer's restrictions regarding conflict of interest
for assessing the quality of research Standard VI: Conflicts of interest
Disclosure to employers
Develop measurable criteria Standard V & VI
Standard V: Investment analysis, Must take reasonable steps to avoid conflicts
for assessing outside providers (information)
recommendations & actions

If conflicts occur inadvertently, must report them promptly

Adopt a standardized set of criteria for evaluating the adequacy of external advisers

Recommended procedures should disclose compensation arrangements such as bonus based on short term
Type something The standard
performance, fee based on capital gain

Investment transactions for clients and employers must have priority over investment
transactions in which a member or candidate is the beneficial owner
The standard

Adequate describe to clients & prospective clients the investment decision-​making process client is not disadvantaged by the trade
B. Communication with clients and prospective clients

Present basic characteristics of an investment Informing clients of the investment process Personal investments are accepted as long as investment professional does not benefit personally from trades undertaken for clients

Keep them informed changes in the investment process investment professional complies with applicable regulatory requirements
Guidance
Any means of communications clients & employee's transactions have priority
Guidance
Must be supported by background report or data Brief communications Different forms of communication B. Priority of transactions Personal trading secondary to trading for clients may undertake personal transactions after clients & employers have had adequate
opportunity to act on recommendation

Capsule form
Family accounts (that are client accounts) should be treated like other accounts

Identifying risks and limitations

Limited participation in equity IPOs

Distinction between facts and opinions in reports

Establish blackout/restricted periods

Excluding and including information in research reports depends heavily on case-​by-​case Recommended procedures
review rather than a specific checklist Reporting requirements

Recommended procedures
M&C should encourage their firms to have a rigorous methodology for reviewing research Disclosure of firm policies to clients
that is created for publication and dissemination to clients

must disclose to their employer, clients, and prospective clients, as appropriate, any
M&C should be able to supply additional info to the client factors not included in the report compensation, consideration, or benefit received from or paid to others for the
recommendation of products or services

The standard
must develop and maintain appropriate records to support their investment analyses,
recommendations, actions, and other investment-​related communications with clients and
prospective clients The standard employer, clients/ prospective clients
C. Referral fees

Guidance Inform Compensation, consideration, benefit, received from (or paid to) others

Either in hard copy or electric form

before entry into any formal agreement

When leaving a firm to seek other employment, the member or candidate cannot take the Guidance C. Record retention
property of the firm Records are the property of the firm Recommended procedures encourage firm to develop procedures related to referral fees

For future use, M&C must re-​create the supporting records at the new firm with information
gathered through public sources

In the absence of regulatory guidance or firm policies, CFA Institute recommends

maintaining records for at least 7 years Recommended procedures

Record keeping requirement generally is the firm's responsibility

M&C must archive research notes and other documents

 Registration in the CFA Program has been accepted
Candidates
When referring to CFA Institute, CFA Institute membership, the CFA designation, or
or when the exam results have not been received
candidacy in the CFA Program, members and candidates must not misrepresent or
exaggerate the meaning or implications of membership in CFA Institute, holding the CFA
completing Professional Conduct Statement (PCS) designation, or candidacy in the CFA Program

Members
paying applicable CFA Institute membership dues on an annual basis Introduction must be used as adjectives

completion of CFA Program always capitalize the letters "CFA"

required 4 years of working experience CFA Charterholders not alter the designation to create new words or phrases

maintain the CFA Institute membership not be used as part of the name of a firm

B. Reference to CFA Institute, Proper usage of the CFA marks

Standard VII the CFA Designation & the not be given larger or bold font than the charterholder's name
CAF Program
must not engage in any conduct that compromises the reputation or integrity of CFA
Institute or the CFA designation or the integrity, validity, or security of CFA Institute no designation exists for some who has passed Level I, Level II, Level III of the exam
programs

not be referred to as a degree

Cheat on any CFA Institute exams or violate the testing policies

no CFA pending
questions on the exam
disclose CFA charterholders
A. Conduct as Members
topics, formulas tested or not tested on the exam Must not and Candidates in the
CFA program Proper using the CFA designation
Over-​promise the competence of an individual
improperly use an association with CFA Institute to further personal or professional goals Must not make promises or guarantees tied to the CFA designation, any form of
communication
Over-​promise future investment results
misrepresent information on the PCS

Referring to candidacy in the CFA program

express an opinion May
 must be the corporation, subsidiary, or division that is held out to clients as a business
Definition of the firm entity

If a firm has different geographic locations, the definition of the firm should include all the
various geographic locations and their clients

refers to how a firm determines which of the portfolios it manages should be included in a
Definition of discretion composite

A firm may determine that a portfolio is nondiscretionary—​and therefore not include it in a

composite—​if the client places restrictions on it that prevent the manager from carrying out
the intended strategy

Firms must comply with all the requirements of the GIPS standards, including any updates,
Guidance Statements, interpretations, Questions & Answers, and clarifications published by
CFA Institute and the GIPS Executive Committee, which are available on the GIPS website as
Representative accounts well as in the GIPS Handbook

Survivorship Bias Misleading practices in the past Firms must comply with all applicable laws and regulations regarding the calculation and
presentation of performance

Varying time periods

Firms must not present performance or performance-​related information that is false or
misleading
Best practices for calculating and presenting

The GIPS standards must be applied on a firm-​wide basis

Worldwide acceptance
Fundamentals of compliance
Firms must document their policies and procedures used in establishing and maintaining
Accurate and consistent data GIPS Objectives
compliance with the GIPS standards, including ensuring the existence and ownership of
client assets, and must apply them consistently
Why created?
Fair, global competition
Requirements
If the firm does not meet all the requirements of the GIPS standards, it must not represent
Self-​regulation or state that it is “in compliance with the Global Investment Performance Standards except
for ...” or make any other statements that may indicate partial compliance with the GIPS
standards
Investment management firms
Who benefits from compliance?
Statements referring to the calculation methodology as being “in accordance,” “in
Prospective clients compliance,” or “consistent with” the GIPS standards, or similar statements, are prohibited

investment management firms that actually manage assets Statements referring to the performance of a single, existing client portfolio as being
“calculated in accordance with the GIPS standards” are prohibited, except when a GIPS-​
voluntary Who can claim compliance? compliant firm reports the performance of an individual client’s portfolio to that particular
client

fully comply with all requirements of GIPS or not comply all

Firms must make every reasonable effort to provide a compliant presentation to all
prospective clients. Firms must not choose whom they present a compliant presentation to.
As long as a prospective client has received a compliant presentation within the previous 12
months, the firm has met this requirement
Global Investment
Performance
Fundamentals of Compliance Firms must provide a complete list of composite descriptions to any prospective client that
Standards (GIPS)
makes such a request. They must include terminated composites on their list of composite
descriptions for at least five years after the composite termination date
Input Data and Calculation Methodology

Firms must provide a compliant presentation for any composite listed on their list of
Composite and Pooled Fund Maintenaince
composite descriptions to any prospective client that makes such a request

Composite Time-​weighted return report

Firms must be defined as an investment firm, subsidiary, or division held out to clients or
prospective clients as a distinct business entity
Composite Money-​weighted return report Key concepts of GIPS standards for firms

For periods beginning on or after January 1, 2011, total firm assets must be aggregate fair
Pooled Fund Time-​weighted return report value of all discretionary and non-​discretionary assets managed by the firm. This includes
both fee-​paying and non-​fee-​paying portfolios

Pooled Fund Money-​weighted return report'

Total firm assets must include assets assigned to a sub-​advisor, provided that the firm has
discretion over the selection of the sub-​advisor
GIPS Advertising guidelines

Changes in a firm’s organization must not lead to alteration of historical composite

performance

When the firm jointly markets with other firms, the firm claiming compliance with the GIPS
standards must ensure that it is clearly defined and separate from the other firms being
marketed, and that it is clear which firm is claiming compliance

A grouping of individual actual discretionary portfolios representing a similar investment Firms should comply with the recommendations of the GIPS standards, including
strategy, objective, or mandate recommendations in any updates, Guidance Statements, interpretations, Questions&
Answers, and clarifications published by CFA Institute and the GIPS Executive Committee,
which will be made available on the GIPS website as well as in the GIPS Handbook
A composite must include all fee-​paying, discretionary portfolios (current and past) that the
Recommendations
firm has managed in accordance with a particular strategy
Composite
Firms should be verified

The firm should identify which composite each managed portfolio is to be included in
before the portfolio’s performance is known in order to prevent composites with superior Firms should adopt the broadest, most meaningful definition of the firm, encompassing all
returns geographical offices operating under the same brand name regardless of the actual name
of the individual investment management company

Reporting on the performance of composites gives clients and prospects information about
the firm’s success in managing various types of securities and results for various investment Firms should provide to each existing client, on an annual basis, a compliant presentation
styles of the composite in which the client’s portfolio is included

All discretionary portfolios must be included in one, and only one, composite Who can claim verification Firms are encouraged to pursue independent verification of their compliance with GIPS

Verification must be performed by a third party in order to increase confidence in the firm’s
How to perform verification claim of compliance

Independent verification Verification applies to the entire firm’s performance measurement practices and methods,
not a selected composite

Verification increase the knowledge of the firm’s performance and improve the consistency
and quality of the firm’s compliant presentations

Advantages of performing verification

Verification provides assurance on whether the firm’s policies and procedures related to
composite and pooled fund maintenance, as well as the calculation, presentation, and
distribution of performance

Verification improves internal processes and procedures as well as marketing advantages to

the firm