Can someone please explain the guidelines for accepting gifts. I feel like I have run into a few mock exam questions from Kaplan, CFAI, and FinQuiz where I have had some conflicting answers.
I believe the following two concepts are true:
Small immaterial gifts are ok, they do not create any issues.
Larger gifts such as bonuses are able to be given with disclosure and consent from the employer.
Where it gets a little confusing is when people offer lavish trips for example. It seems like everything can be ok if given disclosure and consent from the employer in certain questions while in others the answer is it is best to decline anything lavish as it may create a conflict of interest for bias.
Anyone have any set guidelines to share on how they approach the ambiguity here?
Small gifts are fine from anyone. Larger gifts on the other hand depend upon who it is from. If it is from client then we need to get written consent from employer, if it is from other business relations, say broker, then it is to be declined.
I doubt they will have a question THIS nitpicky, however any gift that can be perceived as compromising independence and objectivity (That isn’t directly from a client) is bad.
Gifts from clients are chill, as long as disclosed. Under loyalty to employers, Additional Comp, violation because he didn’t disclose.
When doing outsider manager selection (hiring capacity)…no gifts. (1B)
Gifts from others should be disclosed with written consent from company before taking, and the best answer is take nothing. HA.
I believe that there is more of an issue if the gift is considered to affect your objectivity. So a large gift from a broker would be more likely to impede your objectivity vs. a large gift from a client, which is why you cant accept it.
Sorry, I cant cite.I am not reading ethics this time. What I wrote was from memory. As I said, small gifts are fine from anyone, even brokers, but large gifts from anyone except clients is to be declined because it might impair your judgment. In Example 7 the gift is huge, resort stay, limousine, world cup tickets etc, hence it is to be declined.
Yeah we are on the same page. I actually spent another 7 hours on ethics. Did you hit the manager codebook? I would. The appendix is like 8 pages but I think it’s highly testable. Primarily what a compliance office is/should do and business continuity plans.
No, I did not read the codebook. The only reading I’ll do in ethics will be on the evening before the exam. For now I am just relying on EOC, topic tests and mocks.