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Mandy Elmar, CFA has been conducting research on Xoom Corp. Elmar was almost done with her research
and was planning to get the report typed today and delivered to the clients the next day.
However, this morning, Elmar lost her folder which had all the documents related to Xoom Corp.
In this panic state, she called the management of Xoom Corp who sent her their projections of the company.
Although Elmar did not remember the exact forecast from her report, she knew they were lower than the management
projections. Therefore, Elmar reduced the forecast provided by the management of Xoom by 15%. She also used
graphs and charts from another report a colleague did on Xoom 2 years earlier. Elmar managed to finish the report
on time and sent it on time to the clients. Elmar has most likely:
A. A. Violated Standard V(A): Diligence and Reasonable Basis, Standard I-B: Independence And Objectivity and Standard III-E: Preservation Of Confidentiality.
B. Violated Standard I(C): Misrepresentation, Standard III-D: Performance Presentation and Standard III-E: Preservation Of Confidentiality.
C. Violated Standard V(A): Diligence and Reasonable Basis, Standard I(C): Misrepresentation and Standard V(C): Record retention.
The correct answer is C.
By using the forecasts provided by the management, Elmar has violated the standard regarding diligence and reasonable basis. The graphs and charts used in the report were from other reports. Hence, she has violated Standard I(C): Misrepresentation that addresses plagiarism. Elmar has no files of her own research, thus violating Standard V(C): Record Retention. From the information presented, nothing leads us to believe that she violated Standard III-E: Preservation Of Confidentiality.