Glossary · Compliance and regulation
The basis for a recommendation is the documented reasoning showing why a particular recommendation was in the client's best interest, including the alternatives considered and rejected.
Most proposals document what is being recommended — allocation, projections, holdings — and not why. The alternatives-considered statement, including at least one lower-cost or simpler option with the reason it was not chosen, is the part that defends the recommendation later.
A recommendation that never considered a cheaper alternative is indistinguishable, on paper, from one that never looked.