· Firms. The PPS Standards are voluntary. The PPS are widely recognized as fair and accurate reporting guidelines for investment performance.

　　· AIMR Members, CFA Charterholders, and CFA Candidates. The PPS are not explicitly incorporated into the AIMR Code and Standards of Professional Conduct. The PPS does, however, help insure that members, charterholders and candidates are in compliance with Standard V(B), Performance Presentation, so that they will make no material misrepresentation of their performance results.

　　· Prospective and Current Clients. The PPS helps clients compare investment performance across firms. The PPS helps clients *uate their investment manager’s performance.

　　c: Identify the four main topics of the AIMR-PPS standards (i.e., creation and maintenance of composites, calculation of returns, presentation of results, and disclosures).

　　· Creation and maintenance of composites. A composite is a set of portfolios that follow the same investment style.

　　· Calculation of returns.

　　· Presentation of results.

　　· Disclosures.

　　d: Identify what constitutes a valid claim of compliance with the AIMR-PPS standards.

　　To claim compliance, firms must meet all composite, calculation, presentation, and disclosure requirements. Adherence to the basic requirements, however, does not guarantee fair and adequate performance reporting. Compliance with the standards also requires adherence to all applicable laws and regulations.If the firm has made every reasonable effort to ensure that their performance presentation is in compliance with the PPS, the firm can use the following legend:?

　　XYZ Firm has prepared and presented this report in compliance with the Performance Presentation Standards of the Association for Investment Management and Research. AIMR has not been involved with the preparation or review of this report.

　　· Any use of the mark “AIMR” except as shown above is prohibited.

　　· If results are not in full compliance, performance cannot be presented as: Being in compliance with the AIMR-PPS except for …

　　· Statements referring to the calculation methodology used in a presentation as being in accordance or compliance with AIMR-PPS standards are prohibited.

　　· AIMR members who misuse the term AIMR, AIMR-PPS standards, or the Compliance Statement are subject to disciplinary sanctions under Standard V(B).