John Austin's firm advertises its past performance record by showing the 15-year return history of a composite of its client accounts. The description of the composite on the advertisement states that ALL client accounts are included when calculating the composite return. Austin discovers, however, that the composite omits the performance of accounts that have left the firm during the 15-year period. This omission has led to an inflated performance figure. Austin's supervisor has made it clear that Austin is expected to use promotional material when soliciting business for the firm. Austin should (Choose the best answer.) O (No answer given) O continue to use the promotional material as his supervisor expects him to do so. O leave the firm. O bring the error to the attention of his supervisor and the firm's compliance department.
John Austin's firm advertises its past performance record by showing the 15-year return history of a composite of its client accounts. The description of the composite on the advertisement states that ALL client accounts are included when calculating the composite return. Austin discovers, however, that the composite omits the performance of accounts that have left the firm during the 15-year period. This omission has led to an inflated performance figure. Austin's supervisor has made it clear that Austin is expected to use promotional material when soliciting business for the firm. Austin should (Choose the best answer.) O (No answer given) O continue to use the promotional material as his supervisor expects him to do so. O leave the firm. O bring the error to the attention of his supervisor and the firm's compliance department.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:John Austin's firm advertises its past performance record by showing the 15-year
return history of a composite of its client accounts. The description of the
composite on the advertisement states that ALL client accounts are included
when calculating the composite return. Austin discovers, however, that the
composite omits the performance of accounts that have left the firm during the
15-year period. This omission has led to an inflated performance figure. Austin's
supervisor has made it clear that Austin is expected to use promotional material
when soliciting business for the firm. Austin should
(Choose the best answer.)
O (No answer given)
continue to use the promotional material as his supervisor expects him to
do so.
O leave the firm.
O bring the error to the attention of his supervisor and the firm's compliance
department.
O say nothing as he did not calculate the performance himself.
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