Practice Analysis and Curriculum Development

Mission Statement To lead the investment profession globally by setting the highest standards of ethics, education, and professional excellence. Page 2

Page 3 The CFA ® Program A self-study, distance learning-based program that takes a generalist approach to security analysis and portfolio management and emphasizes the highest ethical and professional standards.

The CFA ® Program Cycle Page 4

Bodies of Knowledge Based on an Analysis of Practice

Bodies of Knowledge Global Body of Investment Knowledge TM The GBIK is the comprehensive outline of knowledge for the investment profession. Investment professionals may use GBIK concepts at any stage of their career - novice through expert, generalist and/or specialist. The GBIK includes mainstream and frontier concepts based on research that is still being debated and may encompass views well outside those of the mainstream. Candidate Body of Knowledge TM The CFA Program CBOK is the core knowledge, skills, and abilities (competencies) that are generally accepted and applied by investment professionals. These competencies are used in practice in a generalist context and are expected to be demonstrated by a recently qualified CFA charterholder. Specialized Bodies of Knowledge [e.g. Private Wealth, CIPM]: These SBOK represent the knowledge, skills, and abilities (competencies) that may be applied by investment professionals within specialty areas. SBOK can include mainstream and frontier concepts. Page 6

Practice Analysis: What and Why?  Most respected authorities in education, testing and certification recommend or require periodic practice analysis studies  Focuses on the critical tasks performed by competent people working in the profession  Establishes content validity – curriculum and exams must be linked to the knowledge and skills needed by practitioners  Results in new GBIK & CBOK – the blueprint for curriculum and exam content  The only way a topic gets into the CFA Program (and eventually tested) is if practitioners throughout the world deem it important. Page 7

Practice Analysis Process  2006 and Prior  Approximately 5-year cycle  CBOK focus  Develop Degree of Understanding Outline and Topic Area Weights  Foundation for Curriculum and Exam Development  New Practice Analysis Process  Continuous, four-phase development process  GBIK and CBOK focus  GBIK and CBOK updated on an annual basis  Test specifications will continue to be updated on a multi-year cycle  Foundation of All Educational Activities at CFA Institute Page 8

Page 9 Phase 1 of Practice Analysis Process

Collaborative Community for Practice Analysis/GBIK TM  The purpose of this site is to continuously update and refine our Global Body of Investment Knowledge (GBIK) --- a living document.  There are three main areas of interest:  Documents: Contains the current GBIK in hierarchical form  Discussions: Discussions about additions, deletions, improvements or a revised structure to the GBIK  GBIK Wiki: Presents the GBIK topics in tree format  Domain Moderators are responsible for the oversight of GBIK topics  EAC Working Body assigned to domain topic and provides support to domain moderators. Page 10

Collaborative Community for Practice Analysis/GBIK Page 11

Collaborative Community for Practice Analysis/GBIK TM Page 12

Collaborative Community for Practice Analysis/GBIK Page 13

Collaborative Community for Practice Analysis/GBIK Page 14

Collaborative Community for Practice Analysis/GBIK TM Page 15

Phase 2 of Practice Analysis Process Page 16

Page 17 Employer Advisory Panels  To obtain input on industry trends to ensure that the GBIK and CFA Program CBOK remain current  To assist CFA Institute in better understanding employers’ expectations regarding the competencies and skills and abilities of investment professionals  To learn more about how CFA Institute and the CFA program can better serve employers’ needs

Page 18 Regional Expert Panels  To assist CFA Institute in identifying changes necessary to ensure that the GBIK and CFA Program CBOK remain current  To obtain input from a wide variety of professionals  To ensure that the CFA Program CBOK reflects the diversity of practice within the investment profession

Page 19 Locations of Practice Analysis Panels  New York – December 2008  Dubai – February 2009  Hong Kong – March 2009  London – October 2009  Zurich – October 2009

Phase 3 of Practice Analysis Process Page 20

Page 21 Member Survey  Based on results from collaborative website and panel discussions  Regionally stratified-sample to reflect membership  Over 2,000 responses with the following regional breakdown:  Americas35%  Asia Pacific29%  EMEA36%  Output used by Practice Analysis Task Force to set topic weights and specific knowledge areas

Phase 4 of Practice Analysis Process Page 22

The CFA ® Program Cycle Page 23

CFA Program Candidate Body of Knowledge

Portfolio Management and Wealth Planning Investment Tools Asset Valuation Portfolio Management Ethical and Professional Standards Quantitative Methods Economics Financial Reporting and Analysis Corporate Finance Equity Investments Fixed Income Derivatives Alternative Investments Ten CBOK Topic Domains Page 25

Curriculum  The topic focus and learning focus differ at each level Topic FocusLearning Focus Level IInvestment ToolsKnowledge Ethical StandardsComprehension Level IIAsset ValuationApplication Ethical StandardsAnalysis Level IIIPortfolio ManagementSynthesis Ethical StandardsEvaluation  The curriculum at each level is organized into 18 study sessions Page 26

Principles of Curriculum Development  A curriculum that is:  Faithful to the practice analysis and CBOK  Fair to candidates  Valuable to members, employers, and investors  Incorporates “best practices” in content and pedagogy  The curriculum content should be:  Globally relevant  Generalist (as opposed to specialist) in nature  Appropriate for a new charterholder  Testable  Authoring/selection/review processes that are extensive, intensive, and diverse in all topic domains  Uses both candidate time and CFA Institute resources appropriately and effectively Page 27

Curriculum Ground Rules  Teach the knowledge and skills required of a generalist  Identified in the Global Practice Analysis  Defined by CBOK and DUO  Select, develop and regularly review materials that:  Are appropriate in a distance-learning environment for a global candidate base  Are clear and accurate  Contain numerous examples/problems with solutions  Avoid curriculum materials that are:  Predominately empirical/historical in nature  Topical (current events oriented or survey articles)  Country specific and/or specialist in nature Page 28

Custom Curriculum  Custom curriculum gives us flexibility to:  Publish only readings that are required for knowledge  Expand pedagogy (examples, questions, problems)  Revise readings based on practice analysis  Update examples and scenarios to current environment Page 29

The Curriculum Team Educational Advisory Board (EAB) Project Consultants (PCs) Assistant Project Consultants (APCs) Topic Area Experts (TAEs) Authors Reviewers Other Volunteers Staff Page 30

Challenges  Continuous development of the Global Body of Investment Knowledge  Participation on collaborative website  Panel discussions on both CFA Program Candidate Body of Knowledge and Global Body of Investment Knowledge simultaneously  Integrating other specialized bodies of knowledge  Translating into comprehensive competency profiles/learning paths for generalists/specialists. Page 31

Contact To learn more about participating in the practice analysis collaborative website and discussion forum, contact: Carey Hare Project Manager, Curriculum Development CFA Institute Phone: Page 32