Responding to Misrepresentation in Financial Projections

As a CFA charterholder, you are approached by a technology startup that is seeking funding. The company's founder provides you with a financial projection document containing optimistic growth estimates. During a discussion, the founder implicitly suggests that a similar firm's performance supports their projections. You later discover that the founder's comparisons to the other firm's performance are misleading and omit significant risk factors that affect both companies. Knowing the importance of ethical standards in your profession, you must decide how to respond to this information, considering the implications of the CFA Institute Code of Ethics and Standards of Professional Conduct regarding misrepresentation.