THE DIRECTORS OF THE National Federation of Financial Analysts Societies made history at the Montreal Convention when they approved the report of the Professional Ethics and Standards Committee for Analyst accreditation by vote of 56 to 13. This report provides for the establishment of professional standards through the proposed Institute of Chartered Financial Analysts. There was full and comprehensive discussion of this report at the annual directors' meeting after submission of summary and interpretation of the questionnaire replies from the Analysts. As of June 12, 1959, there were 1,297 replies, well distributed among the 22 Societies. This represents over 20% response, with 75% of the replies for the proposal, and 25% opposed. Nearly 600 of the Analysts indicated they would take the proposed examinations for accreditation. This was considered favorable initial interest. The number and the quality of the comments and letters received (both for and against) was particularly significant since it indicated wide and accelerating interest. This was probably due to better understanding of the proposal, made possible by sending each Analyst copy of the committee's report and proposal dated April 30, 1959. The Directors of the Federation approved the report with instructions that final revised report be drafted, giving effect to some minor changes suggested by the Analysts' replies and clarifying paragraph 5 on page 2 of the report with respect to the Initiating Group. The Initiating Group is exactly what the name implies and differs from membership in the Institute attained by successful examination. Analysts in the Initiating Group, seeking accreditation, will be required to take the examinations appropriate to their age and experience status (just the same as all other Analysts) as outlined in paragraphs 3 to 7 inclusive on pages 1 and 2. The report implied but did not spell this out. The Chairman reported to the National Directors at the annual convention in Montreal that this requirement was definitely established and agreed upon originally by the Professional Ethics and Standards Committee, and subsequently by the Executive Committee of the National Federation at its April meeting in New York City. (Likewise, the June 16th edition of Entre Nous Montreal erroneously reported a 'grandfather clau-se' provides that present members of the Federation be excluded from the necessity of taking examinations.) Among the refinements in the final report, which will be submitted to the national directors for mail ballot, are elimination of the waiting period for Examination I; appropriate provisions for the Montreal and Toronto Societies; and clarifying some points which the questionnaire replies indicate are still not clear to some of our members. Accreditation is voluntary, long-term program to establish sound and adequate minimum standards at the educational, technical and ethical levels. It will not disturb present membership status of any Analyst. It will not affect the standing of Analysts who may not wish to participate. Accreditation objectives in themselves will tend to raise standards steadily. It will have tremendous long-term value in attracting more young men and women to our profession. We will be in better position to measure up to the growing importance of the Security Analyst. A careful evaluation of the questionnaire replies will be submitted to the Initiating Group for their guidance in setting up an appropriate organization, suitable procedures and carefully considered examinations, etc. Great care will be taken so that accreditation will be significant and successful milestone in the Analyst movement, comparable to the founding of the National Federation, The Analysts Journal and the Analysts Seminar. The Committee deeply appreciates the members' confidence and welcomes your support during the coming year in setting up the Institute of Financial Analysts.
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