Question 1

Which of the following is NOT one of the main themes of the Hampel Report of 1998?&#10;A)Good corporate governance needs broad principles&#10;B)Non-executive directors should be shareholders&#10;C)A unitary board is acceptable&#10;D)The board is accountable to shareholders

Accepted Answer

The Hampel Report of 1998 did not suggest that non-executive directors should be shareholders. Instead, it emphasized the importance of having a mix of non-executive directors with diverse backgrounds and expertise to provide independent oversight of the board's activities. The other three themes mentioned - the need for broad principles of good corporate governance, the acceptability of a unitary board, and the accountability of the board to shareholders - were key recommendations of the report.

Question 2

Which of the following is NOT one of the four types of responsibility proposed by Carroll?&#10;A)economic&#10;B)legal&#10;C)international&#10;D)ethical.

Accepted Answer

Carroll proposed three types of responsibilities: economic, legal, and ethical. International responsibility is not one of the types proposed.

Question 3

The provision of electronic information via,for example,XBRL will improve:&#10;A)Verification of information&#10;B)Corporate governance&#10;C)Timeliness&#10;D)Creative approaches to accounting

Accepted Answer

The provision of electronic information, such as XBRL, enhances the timeliness of financial data by allowing for faster and more efficient data processing and dissemination.

Question 4

Corporate governance is the system by which business corporations are directed and controlled.

Accepted Answer

Corporate governance refers to the processes and policies by which a company is directed and controlled. It involves balancing the interests of a company's many stakeholders, such as shareholders, management, customers, suppliers, financiers, government, and the community. Corporate governance provides a framework for attaining a company's objectives, encompassing practically every sphere of management, from action plans and internal controls to performance measurement and corporate disclosure.

Question 5

The provision of balance sheet ratios makes it easier for users to compare performance of the entity to other firms.

Accepted Answer

The answer of The provision of balance sheet ratios makes...

Question 6

A 'good corporate citizen' is an entity that considers the social and environmental impact of its business activities.

Accepted Answer

A 'good corporate citizen' is defined as a company that not only creates economic value for its shareholders, but also contributes to the social and environmental well-being of the communities in which it operates. This means considering the impact of business activities on society and the environment, and taking steps to mitigate negative effects and promote positive outcomes.

Question 7

Two tier boards of governance are common in which country?&#10;A)UK&#10;B)USA&#10;C)Eire&#10;D)Germany

Accepted Answer

Two tier boards of governance, which involve a management board and a supervisory board, are common in Germany. In this system, the supervisory board is responsible for overseeing and appointing members of the management board, while the management board has operational responsibility for the company. This is different from the single-tier board system used in the UK and the USA, where there is only one board responsible for both oversight and management.

Question 8

Which of the following is NOT a valid reason for excluding a statement of future prospects from the reports?&#10;A)It may lead to prosecution if found to be incorrect&#10;B)It is inherently uncertain&#10;C)Management may understate expectations to subsequently 'look better'&#10;D)Lenders may be frightened by reduced prospects

Accepted Answer

Including statements about future prospects in reports is inherently uncertain and can involve risks such as management potentially understating expectations or frightening lenders with reduced prospects. However, the possibility of prosecution for incorrect future statements is not a valid reason for exclusion, as legal and regulatory frameworks typically account for the inherent uncertainties in forecasting and provide guidelines for making forward-looking statements.

Question 9

Auditors report on the financial statements but never report on the management reports.

Accepted Answer

Auditors primarily report on the financial statements to express an opinion on their fairness and adherence to accounting standards. However, they may also review and report on management reports, especially if those are included in the annual report to shareholders, to ensure consistency with the audited financial information or to comply with specific regulatory requirements.

Question 10

Entities are now required to reflect upon the impact of environmental factors when considering the going concern concept.

Accepted Answer

The answer of Entities are now required to reflect upon...

Deck 11: Corporate Governance, corporate Social Responsibility and Ethics