This is the room I took the exam in. It was in the convention center in Chicago as it is in most big cities. I took this the day before the exam just while they were finishing the setup. You see two rows of tables with each table sitting 4 people. What you see here is pretty much what I got. This picture is taken from the entrance. There are restrooms on both sides of the hall as well as water coolers. That way, they lock the doors and no leaves until they are done with the exam. They give you a chair and you share a table with someone else. You bring your own pencils and calculators. “The time is now 9 o’clock. You have 3 hours to complete this portion of the exam. You may begin.”

The two most common questions that I get asked at this stage are ‘Did you pass?’ and ‘When do you find out?’. The third most popular question is ‘What is a passing score?’ or some other variant. Let me answer the simplest question first. The test is administered the first Saturday of June every year without exception. The results for level 1 are released around July 18th or so, and the results for Levels 2 and 3 are about a month later. Please understand that the results dates are rough estimates. If you try and visit cfainstitute.org today you will see the website operates very smoothly and quickly. If you try it starting around August 15th, it gets progressively slower and slower as a hundred thousand people from around the world check the site every hour or less to see the results. It’s kind of funny until it’s you waiting for the results.

The CFA institute passing score is like Bigfoot. A few people claim to have seen it, and there are reports all the time from people claiming to have proof, but those people are usually drunk, a-holes, or sometimes both. First I will go with the facts, then some theories. First, no one has ever gotten a perfect score. Second, the passing score is fluid. It changes between levels and years. The passing score for level 2 in 2008 will be different than the passing score for level 1 in 2008, or level 2 in 2007. However, CFAI does state that the passing score is adjusted according to the difficulty, and that the passing score is never higher than 70%. That means if I got at least 70% right, then I automatically pass. However, I will never know exactly what I got. The results are released in a bit of a grid. On the left hand side list the different subject areas of the exam (ethics, econ, derivatives, etc.). Along the top is a column for 50% or below, between 51% and 69%, and 70% and above. Then there is a grid with the appropriate marks for what you got in a specific area. There is an introductory sentence that begins with either, ‘We are pleased to inform’, or ‘We regret to inform’. That means for corp finance, I only will know whether I got above 70% right, below 50% or in between. I won’t know exactly how many I got right on any specific area of the test or the test overall. Last year I was asked 12 questions on derivatives. I don’t know whether I got 6 right or none right, but they did tell me it was 50% or less. That hardly seems fair to me, but I am positive I got more right this year. I have heard from some people that a passing score is 70% of the top 1% of test takers, and since no one has ever gotten 100%, that the number is usually in the mid 60’s. I don’t know how they figure it out, but ultimately I can’t spend too much time thinking about it. That would only matter if I stopped answering questions after answering the first 70%. I tried to get the best score I could. If it’s good enough I’ll pass. If it isn’t I’ll get pissed. Passed or pissed I still have over 2 months to go.