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CFA FAQ - 2001

What is the CFA?

The Chartered Financial Analyst (CFA) is an internationally recognized professional certification in the finance, banking, and securities industry. Once you are a CFA it means that you have passed exams covering a certain body of knowledge and agree to abide by a specific code of ethics. (Similar to a CPA in the accounting field.)

Per AIMR, the Chartered Financial Analyst (CFA®) Program is a globally recognized standard for measuring the competence and integrity of financial analysts. Its curriculum develops and reinforces a fundamental knowledge of investment principles. Three levels of examination measure a candidate's ability to apply these principles at a professional level. The CFA exam is administered annually in more than 70 nations worldwide.

 

What does a CFA do?

A CFA analyzes individual investment instruments and opportunities (stocks, bonds, derivatives, futures, etc.) and makes "buy" or "sell" recommendations to their firm or the clients of their firm.

 

How does this differ from a CFP®

A Certified Financial Planner® typically helps individuals with their personal financial and retirement planning. Most CFPs work independently, though you may find some in the benefits offices of major corporations.

For CFP information contact: Certified Financial Planner Board, Denver CO at (303) 830 7500 or visit their website at: www.aimr.org

 

Why would I want to be a CFA?

You might consider getting a CFA if you want to work for a brokerage house, investment management firm, or group that publishes investment newsletters. Many major corporations also have CFA's working in their corporate finance divisions to help direct corporate investments of excess cash. (USC's Treasurer's Office has CFAs help decide where to invest the hundreds of millions of dollars of endowment money to achieve the best return.)

 

Who grants the Charters?

Charters are granted by the Association for Investment Management and Research (AIMR). AIMR determines what material is covered by each exam, creates, administers, and grades the exams, and grants the Charters. USC is NOT involved in the examination process other than AIMR sometimes uses USC classrooms when they give their exams.

 

What is the exam process and what does it cover?

There is so much material that AIMR broke it up into 3 groups, which they creatively named "Level I", "Level II" and "Level III". You start out as Level I and work your way up to Level III. You need to pass all 3 exams in order to be granted your Charter. You cannot take the next Level's exam until you have passed the previous Level's exam. AIMR gives these exams in more than 70 countries around the world each year.

Subjects include economics, quantitative methods, corporate finance, financial statement analysis, real estate valuation, global markets & instruments, equity valuation and analysis, derivatives, fixed income analysis, ethics & professional conduct, capital market theory and practice, portfolio management, venture capital, and others.

 

How long does it take to get a CFA?

It takes a minimum of 3 years to achieve the CFA because each level has only ONE exam date per year. All three levels' exams are given on the same day and at the same time. Since you can't take three 6 hour exams simultaneously, it is a minimum of a 3 year process. If you don't pass one or more exams on the first try, it can take 4 or more years to achieve a CFA.

 

When are the exams?

The exams are always the first Saturday in June or the last Saturday in May depending on how the calendar falls in any given year.

How do I register for the EXAM?

To request a registration packet for the exam, contact AIMR at (800) 247-8132 or www.aimr.org/cfaprogram

 

What is the EXAM registration DEADLINE?

AIMR has a sliding fee schedule based on when you complete the registration packet. Their first (and least expensive) deadline is August 31 each year. The FINAL DEADLINE is usually February 28 of the year in which the exam is given.

 

Who is eligible to sit for the Level I exam?

You must have an undergraduate degree (BA or BS) in any major, from a 4 year college or university anywhere in the world OR have a minimum of 3 years of full-time work in the finance, banking, or securities industries.

If you are currently an undergraduate student and will graduate in May 1999, you can sit for the 1999 Level I exam. If you will graduate in June or later, you will have to wait for the 2000 Level I exam.

 

So, WHAT does FBE do?

Each spring USC FBE and the Los Angeles Society of Financial Analysts co-sponsor Review Courses at each level to assist candidates in passing the three AIMR exams. You are NOT required to take any specific coursework to achieve the CFA, but candidates who attend more than 50% of our review course lectures do tend to pass the exams at a somewhat higher rate than the national average.

 

What Review Courses does USC FBE/LASFA offer?

We offer two courses at each level. We offer a 21 week review course and a two-day intensive review at each level.

The 21 week courses meet one night per week, 2-3 hours per lecture, plus one or more Saturday morning problem solving workshops. The 2-day intensive reviews run all day Thursday & Friday in the 3rd week in May, about one week before the exam. Instructors for all programs are a combination of USC, CSUN, and CSULB professors and working professional CFAs.

 

What do the review courses cost?

Fees for the 2002 courses have not yet been set. Fees for last year were: 21 week course = $700; 2-day intensive review = $350.

 

When and where do the Review Courses meet?

The 20 week review courses begin the first week of January and end the 3rd week of May each year.

All the 20 week review courses are taught live on the USC main campus. We may make the Level I and II courses available at other locations such as the USC Orange County Center in Irvine or Cal State University Northridge via live broadcast or videotape replay. Level III is not broadcast or taped.

The 2-day intensive reviews meet on the main USC campus. 2-day review courses are NOT televised or taped.

What if I can't attend class on that day of the week, or have to miss a lecture because of a business trip?

We also videotape the lectures and make them available to registered course participants via the Information Services Center, Hoffman Hall, room 300 on the main USC campus. Candidates can view the tapes at USC when the ISC is open, generally M-Th 7:30am - 10pm, F 7:30am - 5pm, Sat . 9am - 5pm, & Sun. 1pm - 5pm. Tapes may NOT be copied nor removed from the ISC.

 

Can I buy or lease the tapes for my own use?

Tapes are available for lease to AIMR recognized CFA societies and groups. We DO NOT lease tapes to individual candidates or non-recognized groups, except in countries where the exam is given but no CFA society exists. In this case, we will work with the group administering the exam to facilitate a review program in that country. 2002 leasing brochures are not currently available. For general information, 1998 Leasing brochures (pdf format): in the US, international societies.

How do I register for the USC/LASFA Review Course?

Fax your name, mailing address, and candidate level to LASFA at (213) 627-0398 and ask them to put you on their Review Course mailing list. You can also contact them by phone at (213) 627-1230.

If you are a USC MBA student, you have the option of enrolling for USC credit instead of enrolling through LASFA.

 

When are review course materials mailed?

LASFA mails review course materials in late October or early November each year.

 

I am a USC MBA student. Can I take the review course for credit toward my MBA?

Yes. These 3 unit courses are listed in the Spring course catalogs as FBE-571 "Introduction to Financial Analysis; FBE-572 "Intermediate Financial Analysis"; and FBE-573 "Advanced Financial Analysis".

However, you may only count ONE of these 3 courses toward your degree. Courses are CREDIT/NO CREDIT and do NOT have letter grades.

You do NOT have to take the USC/LASFA Review Courses for USC credit if you are an MBA student. In many cases it is much less expensive NOT to take the course for credit.

 

I am an MBA student at another university. Can I still get credit for the course?

You would need to contact your MBA office to determine whether the credits would be transferable from USC to your program. (Some schools will not allow Credit/No Credit grading in their MBA program.)

 

I am an undergraduate USC business student. Can I take the course for undergraduate credit?

NO, however you may audit the course (non-credit) if you qualify. You need to fill out a Permission to Register form and return it to the FBE office. It will be forwarded to Dennis Draper for his approval. Once approved, you need to go to BRI-103 and get a petition for an undergraduate business student to take a graduate business course. Dr. Dennis Draper must also sign this petition. He can be found at BRI-100 (213) 740-2757.

 

How do I pass the USC class and get credit?

You need to pass EITHER the USC administered "Practice Exam" given during the second to the last class session of each course OR pass the AIMR administered CFA exam given in June.

If you pass the USC exam, your credit will automatically be processed by June 15. If you pass the AIMR exam and did not take or did not pass the USC exam, you need to fax a copy of your AIMR congratulations letter along with your social security number to FBE prior to Sept. 28. Anyone not passing the USC exam and not submitting an AIMR letter prior to Sept. 28 will receive a grade of NO CREDIT for the course.

 

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