+Act with integrity, competence, diligence, respect and in an
ethical manner wit the public, clients, prospective clients,
employers, employees, colleagues, and all participants in global
markets
+Place integrity of profession and interest of clients above all else
+Use reasonable care and independent professional judgement
when conducting investment analysis, making investment
recommendations, taking investment action, and engaging in
professional activities
+Practice and encourage others to practice in a professional and
ethical manner that will reflect credit on themselves and the
profession
+Promote the integrity, and uphold the rules of, the capital markets
,CHARTERED FINANCIAL ANALYST
+Maintain and improve
7 Standards of Professional
Conduct:
+Professionalism
+Integrity of Capital Markets
+Duties to Clients
+Duties to Employers
+Investment Analysis, Recommendation
and Action
+Conflicts of Interest
+Responsibilities of a CFA
Member/Candidate
A change in accounting
estimates...
Is a change due to new
information and does not require
old statements to reflect it
,CHARTERED FINANCIAL ANALYST
A change in accounting
principles...
Requires restatement of prior
financial statements
A Priori Probability
Comes from a formal reasoning
and inspection process; an
objective probability
Absolute Yield Spread
The difference between yields on two
bonds;
= Higher Bond Yield - Lower Bond
Yield;
Most commonly used;
Shortcoming is it may always remain
constant even as yield rise or fall
Accelerated Depreciation
, CHARTERED FINANCIAL ANALYST
Applies depreciation more at the
beginning of an assets life
Accelerated Sinking Fund
Allows the issuer the choice ofretiring more than the amount of
bonds specified in the sinking fund
requirement
Accounting Information Flow
1. Journal record every transaction by order of date
in the general journal
2. The general ledger sorts the entries in the
general journal by account
3. An initial trade balance is prepared at the end of
the period to show the balance of each account
and adjustments are then made
4. Financial statements are made from the
adjusted trial balances
Accounting Warning Signs
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