“The CFA Program does not meet the definition of research allowed to be purchased with brokerage commissions” is not mentioned in the question or in the given paragraph, even though what does it mean. Do need an explanation for it?
III(A) use the fund’s soft dollar account to pay the registration and exam fees for the CFA Program
Share
Is the answer option B. As far is option c is concerned I feel it means that CFA institute does not allow or accepts payment via brokerage commission or fund’s soft dollar account (This statement is very different, I did not saw any question of such)
Please share the answer in detail.
I made the same mistake.!
soft dollar arrangement is for research use only
the explanation given was- “Answer C is correct. According to Standard III(A)–Loyalty, Prudence, and Care, the CFA Program would be considered a personal or firm expense and should not be paid for with the fund’s brokerage commissions. Soft dollar accounts should be used only to purchase research services that directly assist the investment manager in the investment decision-making process, not to assist the management of the firm or to further education. Thus, answer A is incorrect. Answer B is incorrect because the reasonableness of how the money is used is not an issue; the issue is that educational expense is not research.”
Actually the reason given in the answer is nothing new. We already knew it. Its just we did not understand the last option properly. Indeed soft dollars are to be only used for the benefit of clients.
It was a good question.