QUESTIONS 1 THROUGH 18 RELATE TO ETHICAL AND PROFESSIONAL STANDARDS.

16. A CFA charterholder has decided to revise her firm’s written compliance manual.

She checks with counsel regarding changes to applicable laws, rules, and

regulations. She incorporates these changes as well as changes to the Code and

Standards in the new version and distributes copies to her staff along with a

memorandum. The memorandum states that the updated manual includes

compliance procedures designed to meet industry standards, regulatory

requirements, requirements of the Code and Standards, and circumstances of the

firm. According to the Standards of Practice Handbook, did the charterholder

violate any Standard of Professional Conduct?

A. No.

B. Yes, because compliance procedures may not be designed to meet industry

standards.

C. Yes, because compliance procedures should not be altered to meet the

circumstances of the firm.