2012 CFA Level2 Sample Exams Questions and Answers
2012CFA Level2 Sample Exam Version 1-2
Level II Version 1 2012 Sample Exam
McGuinn Case Scenario Forster investment Advisors (FIA) is an asset management firm managing funds for both retail and institutional clients. FIA also undertakes Investment Banking activities including market-making. Recently, FIA’s Finance Director, who acted as the firm’s Compliance Officer, retired. The Board decides to hire a part-time Compliance Officer on a consultancy basis rather than as a full-time employee, to save costs. FIA’s Managing Director asks Terry McGuinn, CFA, if he would be interested in being the Compliance Officer on a part-time basis. McGuinn, an independent compliance consultant whose clients mostly include pension funds, agrees to meet the Managing Director to discuss the position. At the meeting McGuinn is told, “FIA adopted the CFA Institute Code and Standards ten years ago. The outgoing Finance Director assured us at the time we adopted the Code that all of FIA’s policies and procedures met the requirements of the Code and Standards and most of the recommendations as well. As a result we mention compliance with the Code and Standards in all of our marketing material.” After agreeing on terms and conditions, McGuinn accepts the offer to act as FIA’s Compliance Officer on a part-time consultancy basis, with immediate effect. As part of the agreement, McGuinn is only required to go into the office once a week, with most of the communication between him and senior management being via e-man or over the phone as needed. McGuinn immediately reviews a Request for Proposal (RFP) to be submitted the next day to a potential pension fund client. The proposal is identical to another R.FP sent out two months ago and includes FIA’s organizational structure, an in-depth description of their investment process along with the occasional use of third-party research providers and details a guarantee of a minimum 5%...