Three of the most fundamental issues that a firm must consider when becoming compliant with the GIPS^® standards are the definition of the firm, the firm’s definition of discretion, and the firm’s composite definition principles and guidelines. The definition of the firm is the foundation for firm-wide compliance and creates defined boundaries whereby total firm assets can be determined. The firm’s definition of discretion establishes criteria to judge which portfolios should be in a composite to accurately reflect the application of the firm’s investment strategy. Once the firm and discretion have been defined, composites can be constructed based on the strategies implemented by the firm. Firms are reminded that, under the GIPS standards, they must comply with all applicable laws and regulations.