Deck 25: Accounting for Corporate

Question 1

The statement concerning social responsibility reporting in Australia that is not correct is:

A) Australian companies have been at the forefront of reporting and are well ahead of their counterparts in Europe and the US
B) since the 1980s there has been an increasing trend in the quantity and quality of disclosure
C) companies tend to disclose more positive than negative information
D) none of the above, i.e., all are correct statements

Answer 1

A

Question 2

Economic performance refers to traditional business profit as well as issues such as the long-term sustainability of which of the following?

A) a company's expenses
B) the demand for its product
C) its pricing and profit losses
D) elasticity of the market price

Answer 2

B

Question 3

Corporate social responsibility is best thought of as:

A) the need to meet the objective of maximising the wealth of a company's ordinary shareholders
B) adopting safe work practices for all employees
C) consideration of the impact of a company's activities on the welfare of society as a whole
D) producing safe, as well as reliable, products

Answer 3

C

Question 4

Triple-bottom line reporting involves giving information on a company's:

A) economic, environmental, and social activities
B) economic, voluntary, and human rights activities
C) environmental, social, and community activities
D) environmental, social, and political activities

Question 5

The IRC identifies which of the following as capital?

A) production capital
B) human capital
C) waste capital
D) all of the above

Question 6

The extent to which mandatory reporting of corporate environmental and social activities is useful can be questioned because:

A) it is too difficult to measure the costs of such activities
B) it may become merely a public relations or similar self-justifying exercise
C) it is a waste of time forcing companies to report
D) all of the above

Question 7

When companies adopt social reporting by estimating and considering the cost of purchasing the most sustainable alternative on the market and the cost of remediation of environmental effects arising from the operations,they are applying the:

A) maintenance cost approach
B) damage cost approach
C) asset valuation approach
D) none of the above

Question 8

'Enlightened self-interest' is usually defined as:

A) engaging in corporate philanthropy, such as by making donations to universities and public charitable institutions
B) incurring costs that promote benefits for society as a whole but which it is hoped will generate benefits for the company concerned that will exceed those costs
C) taking decisions that benefit consumers and the general community, as well as benefiting shareholders of the company concerned
D) taking decisions that benefit consumers and the general community

Question 9

The approach that justifies corporate expenditure on socially responsible activities by suggesting that there is an implied social contract between a company and society that ensures the company's validity and survival as long as its activities are consistent with society's values is:

A) enlightened self-interest
B) stakeholder management strategy
C) legitimacy theory
D) ethical universalism

Question 10

The most common approach adopted by Australian corporations in accounting for corporate social responsibilities is:

A) descriptive performance reporting
B) quantitative reporting
C) full cost reporting
D) asset valuation approach

Question 11

Describe two possible approaches to the reporting of socially responsible activities by businesses.Explain the difficulties or weaknesses in these approaches.Then suggest ways in which these difficulties or weaknesses might be overcome or reduced in each case.

Question 12

The quantitative reporting of a company's socially responsible activities may not be especially useful because:

A) there can be difficulty in allocating cost accurately to different activities
B) it provides no indication of the effectiveness of the expenditure incurred
C) much of the expenditure incurred may simply be the result of complying with legal requirements or enforcement action by government authorities
D) all of the above

Question 13

Some requirements to account for corporate social responsibility in Australia are contained in:

A) AASB 1018
B) the Corporations Act
C) the Framework
D) There are no legal, accounting standard or Framework requirements for reporting on corporate social responsibility in Australia

Question 14

'A conflict of interest can be argued to exist between maximisation of shareholder's wealth and social responsibility'.Discuss this statement with respect to Australian corporations.

Question 15

The major difficulty in implementing the full cost reporting approach to reporting a company's socially responsible activities is:

A) auditing the resulting cost-benefit report
B) calculating the cost of such activities
C) calculating the value of the benefits
D) all of the above

Question 16

Businesses are most likely to act in a socially responsible manner because:

A) their shareholders demand that they act in this way
B) competitors are acting in a socially responsible manner
C) the Corporations Law requires them to report in relation to any significant environmental regulation to which they are subject
D) consumers demand that they act in this way

Question 17

The 'social performance' aspect of sustainability (or triple-bottom line)reporting is most likely to include details of:

A) total wages and salaries paid
B) investments in employee health and safety
C) steps taken to reduce greenhouse gas emissions
D) all of the above

Question 18

The term used to describe any group or individual who can be affected by or is affected by the achievement of the organisation's objectives is:

A) shareholder
B) entity
C) stakeholder
D) lobby group

Question 19

Describe three means by which governments may take action that is likely to require businesses to act in a socially responsible manner.For each of these three means,explain what considerations are likely to influence a government decision to use that particular method in preference to the others.

Question 20

General standard disclosures are comprised of which of the following?

A) strategy and analysis
B) organisational profile
C) report profile
D) all of the above

Question 21

When an entity's net emissions are greater than the permits they hold,at the end of the year they may:

A) purchase approved carbon offsets
B) purchase unused emission permits from other entities
C) have to pay an emissions fee to the government
D) all of the above

Question 22

The Australian government ratified the Kyoto Protocol on:

A) 3 December 2007
B) 1 January 2005
C) 11 December 1997
D) 16 February 2005

Question 23

The National Greenhouse and Energy Reporting System (NGERS)is currently administered by the Clean Energy Regulator and aims to

A) inform government policy formulation and the Australian public.
B) avoid the duplication of similar reporting requirements in the states and territories.
C) help meet Australia's international reporting obligations
D) all of the above.

Question 24

When an entity's net emissions are less than the permits they hold,at the end of the year they:

A) must forfeit the excess credits
B) can sell the excess credits to other entities
C) can bank the excess credits for future use
D) B and C above

Question 25

Explain the three components of the Emissions Reduction Fund (ERF).