GIPS Verification

Which of the following ABC policies _most likely_ violates GIPS?

Correct. GIPS require the use of trade-date accounting on or after 1 January 2005. Since ABC used settlement-date accounting until 2011, ABC violated GIPS requirements.

Incorrect. GIPS require accrual accounting to be used for all assets that generate interest income.

Incorrect. GIPS require that fair value be used for all portfolio valuations performed on or after 1 January 2011.

Use of accrual accounting

Use of transaction accounting

Implementation of fair value for portfolio valuations