[Harsh_CFA_01_184Participant]

<p class=”cfa-stem”>Frank Taylor, CFA, manages a portfolio for a football club. The club’s chairman is pleased with Taylor’s work and offers him a front-row ticket to an upcoming

<p class=”cfa-stem”>Frank Taylor, CFA, manages a portfolio for a football club. The club’s chairman is pleased with Taylor’s work and offers him a front-row ticket to an upcoming, sold-out match. Taylor accepts the ticket without informing his employer. The chairman also provides Taylor with a performance-based cash incentive for which he receives permission from his employer to accept. Has Taylor most likely violated the Standards?</p>
<span class=”sr-only”>A.</span>No

<span class=”sr-only”>B.</span>Yes, the Standard relating to loyalty, prudence, and care

<span class=”sr-only”>C.</span>Yes, the Standard relating to additional compensation arrangements

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[Madhu Chandarasekaran, CFAKeymaster]

Frank Taylor, CFA, accepted a front-row match ticket (a non-cash benefit of value)

Frank Taylor, CFA, accepted a front-row match ticket (a non-cash benefit of value) without informing his employer. This could influence his objectivity or create a perceived conflict of interest, especially since it comes from a client (the chairman of the football club).

Under CFA Institute’s Standards of Professional Conduct, specifically Standard IV(B): Additional Compensation Arrangements, members must:

“Not accept any gift, benefit, compensation, or consideration that competes with or might reasonably be expected to create a conflict of interest with their employer’s interest unless they obtain written consent from all parties involved.”

Even non-monetary gifts, like match tickets, must be disclosed and approved by the employer if they could be seen as compensation tied to professional services.

The cash performance-based incentive was approved by the employer. No violation here.

• The front-row ticket was not approved by the employer . This is a violation.

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