CFA® Candidate Bulletin - Angelfire

1CFA Candidate Bulletin Vol. 32, December 2001

VOL. 32, DECEMBER 2001

CFA® CANDIDATE BULLETIN

TEST CENTER SECURITYThe tragic events of 11 September have raised security con-

sciousness around the world and everyone is feeling the effects ofheightened security at airports and other public venues. AIMR isserious about security and is taking steps to ensure the safety ofcandidates and testing personnel at test centers around the world.To help ensure a secure testing environment, candidates mustadhere to the policies listed below. As AIMR continues to reviewprocedures, candidates can expect additional policy changes. Inaddition to notices in this and future Candidate Bulletins, candidates will be informed of procedural changes by mail andvia the Candidate Services section of the AIMR Web site.

Candidates are permitted to bring only the followingitems to the test center:

• Examination Admission Ticket. You will not be permittedto enter the testing room without a ticket. Your name on theticket should match the name on your identification.

• Identification. Your identification must meet all of the following criteria: (1) it must be current and valid – it cannot beexpired; (2) it must contain your photo; (3) it must be issued bya government agency; and (4) it must be a single document (nota combination of two or more pieces of identification).Photocopies of identification documents will not be accepted.

• Calculator. You may use only the Texas Instruments BAIIPlus and/or the Hewlett Packard 12C during the examination.No other calculators are permitted. Loose batteries (no pack-aging) are permitted; however, AIMR advises you to placefresh batteries in your calculator on the day before the exami-nation. Calculator cases are permitted. Instruction manualsare not permitted.

• Writing Instruments. All candidates must bring sharpenedNo. 2 or HB pencils (pencil sharpeners will not be provided atthe test center). Level II and III candidates must also bringpens (blue or black ink). Loose erasers are permitted.

• Medicine, tissues, and other medically necessary or personalitems to be used during the examination.

• Snacks, which must be consumed outside of the testing room.

The above items may be carried in your pockets or in a clearplastic bag measuring no more than 8" × 8" (20 cm. × 20 cm.).

NOTE: This is a policy change from prior years.The following items are not permitted at the test center

and must be left at home or in your car. If such items arefound inside or outside the testing room, security personnelwill remove and dispose of them. AIMR is not responsible forstolen, lost, or damaged property.

• Baggage of any kind including backpacks, purses, handbags,briefcases, tote bags, luggage, and lunch bags.

• Study materials (notes, papers, text books, study guides,scratch paper, present/future value tables).

• Drinks (including water), cigarettes, cigars.

• Weapons of any kind.

• Cellular telephones, pagers, headsets, computers, electronicorganizers, Palm Pilot computers, or any other remote com-munication or photographic devices.

• Watches with alarms or audible timers.

AIMR–THE ONLY SOURCE FOR CFAPROGRAM INFORMATION

AIMR’s Information Central Department provides “one-stop shopping” for CFA Program information. Our highlytrained Information Specialists have the latest informationand will answer your questions quickly and courteously.Please direct all of your CFA Program inquiries toInformation Central at tel: 800-247-8132 or 434-951-5499,fax: 434-951-5262, or e-mail: [email protected].

For questions about local society programs and events,contact your AIMR society. However, please remember thatsocieties do not administer the CFA examinations and shouldnot answer specific questions about your candidacy in theCFA Program.

INSIDE

Policy Updates page 2New Test Center Opens page 2Level II and Level III Essay Topics page 3Performance Presentation Standards page 3Errata pages 4–5Disciplinary Actions page 6FAQs pages 7–8

2 CFA Candidate Bulletin Vol. 32, December 2001

CALCULATOR POLICY UPDATELast year AIMR implemented a new calculator policy that

only permits the use of either the Texas Instruments BAIIPlus or the Hewlett Packard 12C during the examination.The policy was generally well received and candidates aroundthe world were able to purchase and practice with one of thetwo permitted models prior to the examination. DespiteAIMR’s publicity about the new policy and warnings fromproctors, 58 candidates used an unauthorized calculator dur-ing the 2001 CFA examinations. In keeping with AIMR pol-icy, the scores of each of those 58 candidates were cancelled.

On exam day, your calculator will be inspected prior tothe start of the examination. Your calculator must thenremain on your desk in full view and proctors will continueto inspect calculators throughout the administration of theexamination. Failure by proctors to detect an unauthorizedcalculator prior to the start of the examination, or your use ofan unauthorized calculator at any time during the examina-tion, does not imply that the calculator is an approved modelor that your scores will ultimately be reported. Use of anunauthorized calculator is considered a violation of AIMRrules and will result in voiding of examination results. To viewAIMR’s calculator policy, see http://www.aimr.org/cfaprogram/calculatorpolicy.html.

IDENTIFICATION POLICY UPDATEAIMR’s identification policy has been in effect for two

years. Identification must meet all of the criteria listed below.Identification must:

1. be current and valid — it cannot be expired;

2. contain your photo;

3. be issued by a government agency; and

4. be a single document (not a combination of two ormore pieces of identification).

Photocopies of identification documents will not beaccepted. Your ID will be inspected prior to the start of theexamination. If your ID is determined to be invalid, you willnot be admitted to the examination. Once you are seated,your ID must remain on your desk in full view and proctorswill continue to inspect IDs throughout the course of theexamination. Proctors are instructed to submit to AIMR pho-tocopies of questionable IDs that may be discovered duringthe administration of the examinations, and validity determi-nations will be made by AIMR following the examinations.Failure by the proctors to detect an invalid ID prior to thestart of the examination, admittance to the testing room, oreven completion of the examination does not imply that theID is valid or that your scores will ultimately be reported. Useof an invalid ID is considered a violation of AIMR rules andwill result in voiding of examination results. In 2001, thescores of 44 candidates were cancelled after AIMR deter-mined that they used invalid identification to enter the test-

ing room. If you have questions about the validity of youridentification, please contact Information Central.AIMR’s preferred form of identification is a valid passport.

Although the address on your ticket does not need tomatch the address on your ID, the name on your admissionticket should match your name as it appears on your ID. If itdoes not match, please contact AIMR to request a correction.

PREPARATORY COURSES AND PREPARATORY MATERIALS

The CFA Program is designed as a self-study, distance-learning program for working investment professionals. Thecritical components of the curriculum are the reading-specific Learning Outcome Statements (LOS). AIMRbelieves that the key to mastery of the Candidate Body ofKnowledge and to success on the CFA examinations is care-ful attention to the LOS. The Council of Examiners writesexaminations based on the readings prescribed by AIMR andon the specific LOS set forth in the Study Guides. Everyexamination question is based on one or more LOS.

Some candidates believe they can ignore the readings pre-scribed by AIMR and substitute preparatory course materialsfor the prescribed readings. While AIMR understands thatpeople have different learning styles, we believe that candi-dates should consider preparatory courses and preparatorymaterials as supplements, NOT substitutes, for the assignedreadings. The Candidate Body of Knowledge for the CFAProgram cannot possibly be mastered in a short period oftime or by using shortcut methods. Candidates who rely sole-ly on preparatory course materials should recognize that theyare doing so at their own peril, because they are relying on thepreparatory course to accurately and completely summarizethe Candidate Body of Knowledge.

AIMR OPENS NEW TEST CENTER -Munich, GermanyAIMR OPENS NEW TEST CENTER -Munich, GermanyAIMR OPENS NEW TEST CENTER -Munich, Germany

AIMR has added Munich, Germany to the list ofregional test centers for the 2002 CFA examinations. Ifyou wish to change your test center to Munich, pleasesubmit a written request to AIMR before 29 March2002. Please provide your name and candidate numberwith your request. There is no fee for changing to thisnew test center.

Mail: AIMR, Attn: MUNICH 560 Ray C. Hunt Drive (courier service)PO Box 3668 (mail)Charlottesville, Virginia 22903-0668 USA

Fax: 434-951-5223

E-mail: [email protected]


EXAMINATION RESULTSMore than 80 percent of CFA candidates accessed AIMR’s

new online results feature. To access your results and otherCFA Program information online, please register for the private Candidate Services section of the AIMR Web site athttp://www.aimr.org/canservices/.

Candidates should understand that the score matrix pro-vided with results is an indicator of overall performance andcannot be used to determine scores or pass/fail status. The“<=50%” range is considered poor; “51%–70%” is consid-ered poor to average; “>70%” is considered average to aboveaverage.

AIMR’s Board of Governors sets the minimum passingscores (MPS), and the Governors use a variety of inputs whendetermining the MPS. Numerous factors can influence passrates and AIMR professional staff cannot point to specificreasons for year-to-year variations.

TEST CENTER SELECTIONPlease refer to the lower right-hand section of your accep-

tance letter to confirm your test center selection. The dead-line for test center changes is 29 March 2002; however,AIMR will consider requests received after that date on acase-by-case basis. Remember that AIMR cannot guaranteetest center changes requested after 1 February 2002.Candidates who wish to change test centers must send a written request to AIMR, along with payment of US$100.

SPECIAL REQUESTS FOR TAKING THEEXAM

If you requested a special test center, the religious alterna-tive test date, or special testing accommodations under theAmericans with Disabilities Act (ADA), confirmation of yourrequest is noted in the lower right-hand corner of your accep-tance letter. If your request is not acknowledged on youracceptance letter, please send a written inquiry toInformation Central at AIMR or call the TestingAccommodations Message Center at 434-951-5299. Yourinquiry must be received by 1 March 2002.

LEVEL II AND LEVEL III ESSAY TOPICS Level III candidates should note that Performance

Evaluation and Attribution (Study Session 16) andPerformance Presentation Standards (Study Session 17) arepart of Portfolio Management as indicated in the Level IIIStudy Guide, and as such will be tested in Essay format onthe 2002 examination.

Level II and III candidates should also be advised that themorning session of the 2002 examination will be entirelyEssay format, and the afternoon session of the examinationwill be entirely Item Set format.

STUDY GUIDEUpon initial processing of a candidate application (with-

in approximately four to six weeks of the date the applicationwas received by AIMR), a Study Guide is mailed to the applicant. Receipt of the Study Guide does not indicateacceptance into the CFA Program—only that the applicationhas been received. Please contact AIMR’s InformationCentral for questions about your status in the CFA Programat tel: 800-247-8132 or 434-951-5499, fax: 434-951-5262,or e-mail: [email protected].

Candidates are referred to the front section of the StudyGuide for important information on the CFA Program ingeneral and on the examinations in particular. For instance,“Strategies for Taking the Examination,” “ExaminationRules,” “Grading the CFA Examination,” and a “Warning”about preparatory or review courses can all be found in thefront section of your Study Guide beginning on page 7.

INCOMPLETE CFA PROGRAM ENROLLMENT FORM

Applicants submitting incomplete applications will be sentonly one notice from AIMR. Applications must be completedand received by AIMR within 30 days of the date on the writ-ten notice, so missing information and/or items should be sentvia overnight carrier or faxed to avoid postal service delays.Applicants should check their status with Information Centraltwo weeks after mailing this information. If candidates do notmake their application complete within 30 days of the date ofAIMR notification, their application is cancelled. The regis-tration and enrollment fees are non-refundable.

Applications are considered incomplete if all questions onthe enrollment form are not answered clearly and completely,if the Professional Conduct Inquiry and CandidateResponsibility Statement and Member’s Agreement are notcompleted and signed, and/or if appropriate payment is notsubmitted along with the correct form. Some specific exam-ples of incomplete applications are (1) credit card is denied orincomplete payment is submitted, (2) test center is not select-ed, (3) form is sent without payment, (4) wrong or outdatedform is submitted, or (5) signature is missing.

PERFORMANCE PRESENTATION STANDARDS

AIMR recently published amended and restated AIMRPerformance Presentation Standards (AIMR-PPS®). Level Iand III candidates should continue to study the 1997 versionof AIMR-PPS assigned in Level I Study Session 1 and LevelIII Study Session 17, respectively. Candidates are NOTresponsible for obtaining a copy of the amended AIMR-PPSand will not be penalized in any way for any differences thatmay exist between the two versions of AIMR-PPS.


REFUNDSAIMR generally has no refund policy. The following policy

for enrollment fees goes into effect immediately upon submis-sion of an application to AIMR:

If it is determined that you do not have a bachelor’s degreeor the equivalent in work experience or if you are deniedadmission to the program for professional conduct reasons,your payment of the enrollment fee less a US$100 processingfee will be returned to you.

EXAMINATION RULESCandidates are required to read and abide by all applica-

ble AIMR rules and regulations. Candidates must abide bythe proctors’ verbal instructions and by the pledge printed oneach morning session examination book or answer sheet.

To be fair to all candidates, AIMR does not responddirectly to individual candidate inquiries. If you have a ques-tion concerning CFA Program content, you should contactAIMR ([email protected]) to have your question considered forinclusion in the Candidate Bulletin. Several of the errata list-ed below are in response to candidate inquiries.

Please be advised that AIMR is not responsible for theaccuracy of answers provided in the instructors’ manuals ofthe assigned readings.

ALL LEVELSPlease refer to the separate listing of errata on page 5 that

has been identified in the book Quantitative Methods forInvestment Analysis.

LEVEL IAs advised in the quantitative analysis portion of the 2002

Sample Examination answer section, page references for theGuideline Answers are as follows:

Question Page(s) Question Page(s) Question Page(s)

19 104–110 25 135–136 31 246

20 317–319 26 383 32 248–249

21 125–129 27 11–13 33 14–15

22 117–118 28 178 34 286–287

23 131–134 29 204–207 35 320–321

24 131–132 30 243–244 36 24

Some Level I Study Guides shipped prior to 10 Septembermay be missing page 68. If your Study Guide shows page 68as blank, you can download the page from AIMR’s Web siteor contact Information Central for a new Study Guide.

LEVEL II

Study Session 15, Reading 4C:

• The first sentence of the first item under theCorrections/Clarifications shown on page 63 should read:On page 611, the three occurrences of “June 30,” whenreferring to the 3-month Eurodollar CD futures con-tract settlement date, should be replaced with “March 31.”

LEVEL IIIThe title of the Study Outline on page 21 of the 2002

Level III Study Guide should read “2002 CFA Level IIIStudy Guide Outline” (instead of 2001…). The readings list-ed are correct for the 2002 examination year; only the outlinetitle is incorrect.

Study Session 12, Reading 2A:

• On page 231, first paragraph, the second and third sentences from the end should read: “This implies afutures position of 103.22 contracts. We round this to 103contracts.”

• In the last two paragraphs of page 232 and the first complete paragraph on page 233, every occurrence of “50 con-tracts” should be changed to “100 contracts,” and the occur-rence of “25 contracts” should be changed to “50 contracts.”

2002 CFA PROGRAM ERRATA

CFA® CANDIDATE BULLETIN

©2001 Association for Investment Management and Research. Allrights reserved. CFA® is a licensed service mark of AIMR. The CFA Candidate Bulletin is published by the AIMR Curriculumand Examinations Department.

Contact Information:

Information CentralPhone: 800-247-8132 or 434-951-5499Fax: 434-951-5262E-mail: [email protected]

AIMRPO Box 3668560 Ray C. Hunt DriveCharlottesville, VA 22903-0668 USA


Chapter 4

• On page 199, Equation 4-17 should have a ‘2’ precedingthe last term.

• On page 220 in the solution to problem 12(a), the thirdcovariance calculation, Cov(German bond returns, Italianbond returns), should be 0.70 × 0.606 × 0.635 =0.269367. The final corrected figure of 0.269367 shouldalso replace the two occurrences of 0.181801 in theCovariance Matrix at the bottom of page 220.

• On page 221, replace the solutions to 12(b) and 12(c) withthe following (corrections are bolded):

b. Using Equation 4-17, we find

σ²(RP) = w¹²σ²(R¹) + w²

²σ²(R²) + w³²σ²(R³) + 2w¹w²Cov

(R¹, R²) + 2w¹w³Cov(R¹, R³) + 2w²w³Cov(R², R³)

= (0.70)²(0.167281) + (0.20)²(0.367236) + (0.10)²(0.403225) + 2(0.70)(0.20)(0.022307) + 2(0.70)(0.10)(0.025972) + 2 (0.20)(0.10)(0.269367)

= 0.081968+0.014689+0.004032+0.006246+0.003636+ 0.010775

= 0.121346

c. The standard deviation of this portfolio isσ²(RP) = (0.121346)¹/² = 0.348348, or 34.8 percent.

Chapter 5

• On page 255, in the Solution to 3 within the boxed exam-ple, the term at the end of the first line should beP(RB< 3.75) =

Chapter 6

• In Footnote 5 on page 287, replace the two occurrences of0.808081 with 0.898933, and replace 16.161616 with17.978663.

• On page 303, on the second line from the bottom, (s / n) should not be shown as a subscript.

Chapter 7

• On page 324, delete “equals or” in the last line of textimmediately before Figure 7-2. In the Figure itself, theRejection Region should be z >1.645.

• On page 345, replace the last two sentences of Example 7-8 with the following: “Because 1.434 is less than the crit-ical value 1.61, we cannot reject the null hypothesis that thepopulation variance of returns is the same in the pre- andpost-crash periods.”

Chapter 8

• On page 408, the first line of Problem 10(d) should state“Define Regression SS …” instead of “… MSS.”

• On page 418, at the end of solution to Problem 4, the calculation of the correlation coefficient should have adenominator of 12.91 × 0.8165.

• On page 421, in the solution to 12(a), the estimated variance of the prediction error should equal 0.66694. Theremainder of the answer is unchanged.

Chapter 9

• In Example 9-11 (pages 457 through 459), numbers in theexample text were transferred incorrectly from Tables 9-11and 9-12. The standard error, t-statistic, coefficient, and R²numbers shown in the text should be the same as thoseshown in the tables.

• In Example 9-11, replace the last sentence on page 457with “This result implies that returns on the FSTF aremore volatile than returns on the growth index.”

• On the top of page 459, in the last paragraph of Example9-11, delete the sentence beginning with “In fact ...” andending “greater than 1.”

Chapter 11

• On page 585, in the formula for portfolio standard devia-tion, the w¹ term should be squared.

• On page 629, Problem 14, in the formula for RK, a capital“F” should be inserted between 0.5 and the subscript:0.5FINFL.

• On page 633, the solution to Problem 14, delete the first“0.5” in the first line of the equation.

QUANTITATIVE METHODS FOR INVESTMENT ANALYSIS Errata


EXAM RELATEDThe following disciplinary notices relate to improper con-

duct by candidates while taking the 2001 CFA examination.Every candidate, by signing the Candidate Pledge, acknowl-edges that any violation of the Candidate Pledge or other irreg-ularities in the exam-taking process will result in AIMR void-ing the candidate’s exam results.

These notices evidence the importance of candidates’adherence to AIMR’s Code of Ethics, Standards of ProfessionalConduct, and CFA Program Examination Rules andRegulations. Each incident was investigated pursuant toAIMR’s Rules of Procedure for Proceedings Related toProfessional Conduct. In each of the cases, the sanction, void-ing of examination results and publication of the notice wereadministered in accordance with the Rules of Procedure.

Writing Past Time Called

Exactly three hours after the starting time of the morningand afternoon sessions of the examination, candidates wereadvised, “Stop writing now. Close your examination books andremain seated.” Notwithstanding this instruction, 11 Level Icandidates, one Level II candidate, and two Level III candi-dates continued to write their examinations after time wascalled. AIMR investigated these 14 cases, and found that eachcandidate engaged in the alleged conduct and thereby violatedthe 2001 CFA Program Examination Rules and Regulationsand AIMR’s Standards of Professional Conduct, StandardI–Fundamental Responsibilities. AIMR imposed the sanctionof Private Censure and Voiding of Examination Resultsupon each candidate.

Other CFA Program Rules Violations

One Level I candidate opened his examination prior toinstruction to begin the exam. AIMR investigated the incidentand found that the candidate engaged in the alleged conductand thereby violated the 2001 CFA Program Rules andRegulations and AIMR’s Standards of Professional Conduct,Standard I–Fundamental Responsibilities. AIMR imposed thesanction of Private Censure and Voiding of Exam Resultsupon the candidate.

Each year all candidates sign a statement wherein they agreeto comply with all conditions and requirements of the CFAStudy and Examination Program established by AIMR regard-ing exam administration. Additionally, the January 2001 andApril 2001 CFA Candidate Bulletin advised, “Candidates arealso required to abide by the proctors’ verbal instructions.”Notwithstanding these obligations, a Level I candidate failed tofollow the proctor’s verbal instructions and used inappropriatelanguage while talking to the proctor. AIMR investigated theincident and found that the candidate engaged in the allegedconduct and thereby violated the 2001 CFA Program Rules

and Regulations, AIMR’s Code of Ethics, and AIMR’sStandards of Professional Conduct, Standard I–FundamentalResponsibilities. AIMR imposed the sanction of PrivateCensure upon the candidate.

NOT EXAM RELATEDThe following disciplinary notices relate to conduct by

candidates not related to the CFA Examination AdministrationProcess.

On 8 March 2001, AIMR imposed the sanction of PrivateCensure upon three candidates in the CFA Program, pursuantto Rule 4 of AIMR’s Rules of Procedure for ProceedingsRelated to Professional Conduct. AIMR’s investigation foundthat each respective candidate violated the AIMR Code ofEthics and Standards of Professional Conduct, StandardII(A)–Use of Professional Designation.

• One of the candidates stated, “Affiliations: CFA” on herbusiness card. The candidate was enrolled to take theLevel II examination, but was not an AIMR member orCFA charterholder. The candidate’s reference on thebusiness card was an inappropriate use of the CFA desig-nation and was misleading.

• The second candidate placed “C.F.A. Level I Candidate”after his name on his resume. Although the candidatewas a Level I candidate in the CFA Program, placing thestatement after his name implied it was a partial designa-tion, which is contrary to Standard II(A).

• The third individual used the CFA designation after hername on her resume. Although she had passed all threelevels of the CFA examination, she had not met all of theCFA Program requirements and had not been awardedthe right to use the CFA designation.

All three consented to a Private Censure and to the publi-cation of this notice.

On 8 March 2001, AIMR imposed the sanction of PrivateCensure upon a Level III candidate in the CFA Program, pursuant to Rule 4 of AIMR’s Rules of Procedure forProceedings Related to Professional Conduct. AIMR’s investi-gation found that the candidate violated StandardIII(B)–Duty to Employer and Standard I– FundamentalResponsibilities of AIMR’s Standards of Professional Conduct.

Prior to his employment resignation, the candidate compiled and copied, in electronic and paper format, docu-ments belonging to his employer. The compilation and copy-ing of the documents violated a Confidentiality Agreementsigned with his employer and AIMR’s Standards of ProfessionalConduct. The candidate has destroyed all paper and electroniccopies of the information.

The candidate consented to this Private Censure and tothe publication of this notice.

DISCIPLINARY ACTIONS


Q.I have a medical condition that requires me toconsume food at frequent intervals. Am I permit-

ted to keep and eat snacks at my desk during theexamination?

Candidates are not typically permitted to eat food at theirdesks; rather, they may keep snacks with them (in their pock-ets or in a clear plastic bag) and leave the testing room to eat.However, if you have a medical condition (such as diabetes)that requires you to eat frequently, you may request anaccommodation under the Americans with Disabilities Act.To make your request, please complete the required formsand submit the necessary documentation from your physician. The forms can be downloaded from our web site athttp://www.aimr.org/pdf/cfaprogram/disability_accom.pdfor can be obtained from Information Central.

Q.I received at least 50% on almost all topics on myresults score matrix, but I still did not pass. How

can that be?

Candidates should not attempt to interpret an overallpassing or failing score from the results matrix information.The minimum passing score for the examination is determined by many factors, and is not a predetermined orspecific percentage of the points for either individual topicareas or for the entire exam. Specifically, candidates shouldnot interpret scores between 50 and 70 percent as passing.

Q.Does AIMR recognize the highest scores annuallyor create an honors list? If not, why not?

For several years in the mid- to late 1980s, AIMR did sendletters of recognition to candidates who achieved top scores ateach level. AIMR stopped that practice, however, for the pro-tection of all charterholders. It became clear that some peopleinterpreted the acknowledgement of top scores as identifyingdifferent “rankings” of candidates or charterholders. AIMRand the vast majority of candidates and charterholders werecertainly not served well by this practice and it was eliminat-ed. (For instance, employers could use this information inhiring decisions.) AIMR posts scores as pass or fail and doesnot consider one candidate as more (or less) accomplishedthan another merely because of their relative ranking in a par-ticular year. This is especially true for candidates taking thesame level examination in different years. Results or rankingon a 1998 examination, for example, cannot be compared toresults on the same level examination in 1999.

Q.I have been unsuccessful in two attempts at theLevel II examination, and am not sure what to do

differently to prepare. I have put in the required timeand effort and have also attended seminars to become“test wise.” What do you suggest?

The best preparation for the examinations at all three levels is a thorough knowledge of the reading material identi-fied by the Learning Outcome Statements (LOS). Althoughquestions may combine LOS from one or more study sessions, you can be sure that each question will be basedexplicitly on at least one LOS. The “required time and effort”will obviously differ according to study habits, learning styles,and differences in prior topic knowledge, and trying tobecome “test wise” implies preparation on some basis otherthan mastery of the Candidate Body of Knowledge. The onlydirect way to prepare for the examinations is to master the LOS.

Q.I just enrolled in the CFA Program. When Ireceived my Study Guide, I saw that there are

only two calculators I’m allowed to use. This is anarchaic rule that has no basis except to impose restric-tions on candidates. Why can’t I use my HP17B2?

The calculator policy was developed over many months inresponse to two major concerns. First, the old policy was inef-fective in practice. Candidates were sometimes confused bythe old policy and asked that AIMR provide a short list ofapproved calculator models. In addition, proctors spent significant amounts of time on exam day reviewing the hun-dreds of different calculator models candidates brought withthem. This resulted in long delays in examination startingtimes, especially at large test centers. Because proctors mustperform many important tasks in a timely fashion on examday, AIMR believed that the calculator policy should be simple and easy to enforce. Second, many calculators, such asthe HP17B2, have text-storing capabilities. Candidates couldbring text stored in the calculator into the examination room,creating an unfair situation. By adopting a policy of permis-sion (defining what a candidate may use) rather than a policyof omission (attempting to describe what the candidate maynot use), AIMR can more easily protect the integrity of theCFA examination. It is standard practice of many profession-al testing bodies to provide a short list of permissible models.In the current policy, the HP model is available for candidateswho prefer reverse polish notation entry, and the TI model isfor those who prefer algebraic notation entry. Both of themodels approved for use on the CFA examinations are avail-able for sale worldwide and are relatively inexpensive. Inshort, the policy was developed to create a level playing fieldfor all candidates. Please note that AIMR does not sell calcu-lators, nor does AIMR receive any financial remunerationfrom sales of either calculator model.

FREQUENTLY ASKED QUESTIONS

CONTINUED ON PAGE 8


Q.Do I need to buy all the books? Which book ismost important?

AIMR does not require that candidates purchase all booksused in the curriculum, but we believe that studying the prescribed curriculum is the best course of action. Some candidates rely strongly, or even solely, on preparatory orreview programs and their associated notes. While we recog-nize that there are many different learning styles, we believereview programs are best used as a supplement to, rather thana substitute for, the prescribed curriculum. When usingsomeone else’s notes or interpretations of a reading, you limityourself to their opinion of what is important. You are alsotrusting them to accurately summarize the reading material.Be advised that AIMR does not audit or certify the coverageor accuracy of the materials of any prep course provider,whether third party or society-sponsored. Remember that theexaminations are developed directly from the curriculum andare consistent with the LOS prescribed by AIMR. There is nosubstitute for studying the original material.

Q.The questions and guideline answers to the LevelII and III essay questions are provided to candi-

dates both in printed form and on AIMR’s web site.Where can I get copies of the questions and theanswers for the Level II and III item sets?

Neither the Level I questions and answers nor the Level IIand III item set questions and answers are released to the public. AIMR reserves the option to use modified versions ofpreviously used Level I questions and Level II and III itemsets on future examinations. Although these actual questionsare not released to the public, the Level I format is illustratedin the Sample Exam provided to Level I candidates and theitem set format is explained and illustrated on pages 9–11 ofthe Level II Study Guide and pages 9–12 of the Level IIIStudy Guide.

FREQUENTLY ASKED QUESTIONS – CONTINUED FROM PAGE 7

CFA® Candidate Bulletin - Angelfire

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