Prospective client pays for lunch!

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pissed-level3

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You have scheduled a lunch with a prospective research client. The client insists on paying for an expensive lunch even after you have repeated asked him not to . Which of the following actions would be the best course for you to take under the Code and Standards?
A. Accept the expense-paid lunch and write an objective report.
B. Refund the prospective client for the lunch expenses he paid.
C. Accept the expense-paid lunch but disclose the value of the services accepted in the report.
 
C?
Accepting lunch shouldn’t present a conflict of interest and if you disclose the value of the lunch in your report, should allow prospective investors to assess your independence. Is that the right answer?
 
Yeah the fact it mentions it’s “expensive” rather than a drive thru McDonalds or something, then I would imagine it can be considered material enough to compromise independence and objectivity - the way out is definitely disclosure or paying back the cost of the meal before writing the report.
Usually if it had just said “lunch” rather than “epensive lunch” I would have considered it too small in value to affect anything. I think it’s a stupid question to be honest as it’s definitely border line.
I mean, never in my life have I read a research report disclosure that read, “brought to you on the back of a tantilising dish of scallops, hand-caught oysters, Balik Salmon, fresh Turbot and white Alba truffle - all topped with Cornish lobster tails, gold crumb and two mother-of-pearl spoons holding Beluga caviar”
 
S666 wrote:
Yeah the fact it mentions it’s “expensive” rather than a drive thru McDonalds or something, then I would imagine it can be considered material enough to compromise independence and objectivity - the way out is definitely disclosure.
Usually if it had just said “lunch” rather than “epensive lunch” I would have considered it too small in value to affect anything. I think it’s a stupid question to be honest as it’s definitely border line.
I mean, never in my life have I read a research report disclosure that read, “brought to you on the back of a tantilising dish of scallops, hand-caught oysters, Balik Salmon, fresh Turbot and white Alba truffle - all topped with Cornish lobster tails, gold crumb and two mother-of-pearl spoons holding Beluga caviar”
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If it did happen, you should see it in the last page on the disclosures, under conflicts of interest.
I don’t think they should ‘refund’ anything, especially after the client insisted, that looks cheap
 
S666 wrote:
I think it’s a stupid question to be honest as it’s definitely border line.
Click to expand...
For those who wrote the PM paper last year, you may recall something similar. I still havent found the answer yet!
 
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