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Question 1 of 10
1. Question
Consultants have a responsibility to disclose which of the following things to clients?
I. Compensation in limited forms received for consulting services provided.
II. Compensation in all amounts received for consulting services provided.
III. Compensation in all forms received for consulting services provided.
IV. Compensation in all contracts received for consulting services provided.Correct
Consultants have a responsibility to disclose to clients all compensation in all forms and amounts received for consulting services provided.
Incorrect
Consultants have a responsibility to disclose to clients all compensation in all forms and amounts received for consulting services provided.
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Question 2 of 10
2. Question
Which of the following statements is(are) reasons for consultants to disclose all compensation?
I. Client knowledge of compensation received for services rendered by the consultant establishes a relationship of trust between the parties.
II. The disclosure of compensation as well as disclosure of any financial relationships between the consultant and service providers builds an ethical bridge in the relationship.
III. Disclosure of all compensation, and the sources of such compensation eliminates the
potential for conflicts of interest between the client and consultant.
IV. It builds a healthy market of client/consultant in the decision making process.Correct
Client knowledge of compensation received for services rendered by
the consultant establishes a relationship of trust between the parties. The disclosure
of compensation as well as disclosure of any financial relationships between the
consultant and service providers builds an ethical bridge in the relationship. Disclosure
of all compensation, and the sources of such compensation, also eliminates the
potential for conflicts of interest between the client and consultant.Incorrect
Client knowledge of compensation received for services rendered by
the consultant establishes a relationship of trust between the parties. The disclosure
of compensation as well as disclosure of any financial relationships between the
consultant and service providers builds an ethical bridge in the relationship. Disclosure
of all compensation, and the sources of such compensation, also eliminates the
potential for conflicts of interest between the client and consultant. -
Question 3 of 10
3. Question
When are consultants suppose to review all compensation received for consulting services rendered and report to the client any additional compensation?
I. Annually
II. Monthly
III. Quarterly
IV. Semi-annuallyCorrect
Consultants shall annually review all compensation received for consulting services rendered and report to the client any additional compensation beyond that which the client may reasonably be expected to know.
Incorrect
Consultants shall annually review all compensation received for consulting services rendered and report to the client any additional compensation beyond that which the client may reasonably be expected to know.
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Question 4 of 10
4. Question
The consultant is responsible for which of the following?
I. Fully researching all available information
II. Determining the implications of any information for the client’s situation.
III. Providing full and objective comments
IV. Giving advise for clients to invest moreCorrect
In a world where huge amounts of information are easily available via the Internet, clients can access data that may or may not be relevant to their situations or that may be biased or incorrect. Even if relevant, correct, and unbiased, information and data do not translate to experience and knowledge. The consultant is responsible for fully researching all available information, determining the implications of that information for the client’s situation, and providing full and objective comments.
Incorrect
In a world where huge amounts of information are easily available via the Internet, clients can access data that may or may not be relevant to their situations or that may be biased or incorrect. Even if relevant, correct, and unbiased, information and data do not translate to experience and knowledge. The consultant is responsible for fully researching all available information, determining the implications of that information for the client’s situation, and providing full and objective comments.
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Question 5 of 10
5. Question
How are consultants suppose to inform the client on any important information?
I. By providing aspects known to be relevant to a particular situation, positive or negative.
II. By presenting information in an objective and unbiased manner.
III. By presenting information with a frequency that ensures meaningful communication between the consultant and client.
IV. By Providing only positive aspects known to be relevant to a particular situation.Correct
the consultant must inform the client of all aspects known to be relevant to a particular situation, positive or negative. Information shall be presented in an objective and unbiased manner to assist clients in understanding progress toward their goals. This information also shall be made available with a frequency that ensures meaningful communication between the consultant and client.
Incorrect
the consultant must inform the client of all aspects known to be relevant to a particular situation, positive or negative. Information shall be presented in an objective and unbiased manner to assist clients in understanding progress toward their goals. This information also shall be made available with a frequency that ensures meaningful communication between the consultant and client.
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Question 6 of 10
6. Question
Which of the following is(are) the benefits for clients with consultants providing all pertinent information?
I. It helps clients weigh the impact of their decisions.
II. It enhances the reputation of the investment consulting profession.
III. It builds trust in between both consultants and clients.
IV. It helps to establish a sense of confidence for clients to invest at all times.Correct
By complying with this standard and presenting all information known to the consultant regarding the client’s situation, consultants can help clients weigh the impact of their decisions in the light of full disclosure. This enhances the reputation of the investment consulting profession and IMCA as the professional sources of information, applicability, and objectivity.
Client knowledge of compensation received for services rendered by the consultant establishes a relationship of trust between the parties. The disclosure of compensation as well as disclosure of any financial relationships between the consultant and service providers builds an ethical bridge in the relationship. Disclosure of all compensation, and the sources of such compensation, also eliminates the potential for conflicts of interest between the client and consultant.
Incorrect
By complying with this standard and presenting all information known to the consultant regarding the client’s situation, consultants can help clients weigh the impact of their decisions in the light of full disclosure. This enhances the reputation of the investment consulting profession and IMCA as the professional sources of information, applicability, and objectivity.
Client knowledge of compensation received for services rendered by the consultant establishes a relationship of trust between the parties. The disclosure of compensation as well as disclosure of any financial relationships between the consultant and service providers builds an ethical bridge in the relationship. Disclosure of all compensation, and the sources of such compensation, also eliminates the potential for conflicts of interest between the client and consultant.
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Question 7 of 10
7. Question
Which of the following have the right to highly professional, candid, and confidential relationships with their consultants?
I. Institutions
II. Public funds
III. Bankers
IV. SharholdersCorrect
Institutions, including public funds, and individuals not only have the right to but the need for highly professional, candid, and confidential relationships with their consultants.
Incorrect
Institutions, including public funds, and individuals not only have the right to but the need for highly professional, candid, and confidential relationships with their consultants.
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Question 8 of 10
8. Question
Which of the following statements is(are) NOT accurate in terms of a consultant’s responsibility in client confidentiality and privacy?
I. Consultants shall advise clients of the privacy policy that applies to their relationship and assure them that all information gathered is of a strictly confidential nature.
II. The compliance officer at the consultant’s firm shall be notified of Standard 2d and the consultant’s code of confidentiality.
III. All client records and information relating to financial situations and goals shall be kept private and confidential by the consultant.
IV. The disclosure of a client’s name without obtaining prior permission from the client is prohibited.Correct
Consultants shall advise clients of the privacy policy that applies to their relationship and assure them that all information gathered is of a strictly confidential nature. In addition, the compliance officer at the consultant’s firm shall be notified of Standard 2d and the consultant’s code of confidentiality. All client records and information relating to financial situations and goals shall be kept private and confidential by the consultant.Even the disclosure of a client’s
name without obtaining prior permission from the client is prohibited.Incorrect
Consultants shall advise clients of the privacy policy that applies to their relationship and assure them that all information gathered is of a strictly confidential nature. In addition, the compliance officer at the consultant’s firm shall be notified of Standard 2d and the consultant’s code of confidentiality. All client records and information relating to financial situations and goals shall be kept private and confidential by the consultant.Even the disclosure of a client’s
name without obtaining prior permission from the client is prohibited. -
Question 9 of 10
9. Question
Which of the following client information(s) is(are) consultants prohibited to disclose?
I. Financial status
II. Goals
III. Structure
IV. Information pertaining to high profile clients onlyCorrect
On no occasion shall the consultant disclose the financial status, goals, structure, or other information relating to any client to any other person or body unless legally required to do so.
Incorrect
On no occasion shall the consultant disclose the financial status, goals, structure, or other information relating to any client to any other person or body unless legally required to do so.
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Question 10 of 10
10. Question
Which of the following actions are consultants suppose to do when they receive material nonpublic information in confidence?
I. Use that information
II. Disclose the information
III. Use that information only if it does not harm the client
IV. Abstain from using the informationCorrect
Consultants who receive material nonpublic information in confidence have a responsibility to abstain from disclosure or use of that information, whether or not such use would cause harm to a client.
Incorrect
Consultants who receive material nonpublic information in confidence have a responsibility to abstain from disclosure or use of that information, whether or not such use would cause harm to a client.