AIFA Cheat Sheet 2026

The 30 highest-yield AIFA facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. What is the purpose of a mutual fund? → Pool money for investment
2. Which market deals with previously issued securities? → Secondary market
3. Which metric BEST indicates successful strategic planning & analysis in Applied Investment & Finance Analyst? → Achievement of defined key performance indicators and stakeholder satisfaction
4. What is the PRIMARY benefit of continuous improvement in operations & process management for Applied Investment & Finance Analyst? → Enhanced efficiency, quality, and competitive advantage over time
5. What is the MOST important consideration when implementing human resources & talent development solutions in Applied Investment & Finance Analyst? → Alignment with organizational needs and scalability requirements
6. Under the accrual basis of accounting, expenses are recognized when: → They are incurred and matched to the revenue they help generate
7. Which valuation approach determines value by analyzing the prices paid for comparable companies in recent merger and acquisition transactions? → Precedent transaction analysis
8. Which of the following would cause EBITDA to overstate a company's true economic profitability? → High levels of depreciation on rapidly deteriorating equipment
9. In Applied Investment & Finance Analyst, which client relationship management approach is MOST effective for achieving long-term goals? → Strategic planning with measurable objectives and regular progress reviews
10. Goodwill recorded on an acquisition must be: → Tested for impairment annually under US GAAP
11. Under GAAP, when a company sells goods on credit, revenue should generally be recognized when: → Control of the goods has transferred to the buyer
12. What is the primary purpose of a firm's compliance manual in an investment advisory context? → To set guidelines that help employees meet legal and ethical obligations
13. What is a mutual fund? → Pooled investment managed by professionals
14. What are derivatives used for? → For hedging or speculation
15. In Applied Investment & Finance Analyst, which human resources & talent development practice BEST ensures system reliability? → Implementing redundancy, regular testing, and documented recovery procedures
16. Which communication & stakeholder engagement technique is MOST appropriate when delivering complex information in Applied Investment & Finance Analyst? → Breaking information into manageable segments and confirming understanding
17. Under the CFA Institute Code of Ethics, which duty takes precedence when an investment professional's personal interests conflict with those of a client? → Client interests always come first
18. What is a treasury bill (T-bill)? → Short-term government security
19. When implementing project management & execution changes in Applied Investment & Finance Analyst, what factor is MOST critical? → Stakeholder buy-in and a clear change management plan
20. Which model is used to calculate expected return of an asset? → Capital Asset Pricing Model (CAPM)
21. Working capital is defined as: → Current assets minus current liabilities
22. The debt-to-equity ratio measures: → The proportion of financing provided by creditors versus shareholders
23. In Applied Investment & Finance Analyst, how should client relationship management challenges be prioritized? → Based on potential impact, urgency, and alignment with strategic objectives
24. What is reputational risk? → Damage to company image
25. Which Monte Carlo simulation concept involves running thousands of random scenarios to estimate the probability distribution of a financial outcome? → Stochastic modeling
26. Which financial statement provides a snapshot of a company's assets, liabilities, and equity at a specific point in time? → Balance Sheet
27. What is the primary goal of risk management? → Minimize risk to acceptable level
28. What is net present value (NPV) used for? → Assess investment profitability
29. In a three-statement financial model, which statement serves as the 'bridge' linking the income statement to the balance sheet? → The cash flow statement
30. A deferred tax liability arises when: → Tax expense exceeds taxes currently payable