Accountant in Business Flashcards

Which type of organizational structure groups employees by function, such as finance, marketing, and operations?

Answer: Functional structure

A functional structure organizes employees by specialized departments or functions rather than by product or geography.

In the context of corporate governance, what is the primary role of a non-executive director (NED)?

Answer: To provide independent oversight and challenge executive decisions

NEDs provide independent scrutiny of executive management and contribute to strategy, risk, and performance oversight.

Which of the following best describes 'span of control' in an organization?

Answer: The number of subordinates a manager directly supervises

Span of control refers to how many direct reports a single manager oversees.

A company adopts a policy of rotating its external auditors every five years. Which governance principle does this primarily support?

Answer: Independence

Auditor rotation reduces the risk of familiarity threats, preserving the auditor's independence from management.

Under Mintzberg's managerial roles, which role involves a manager representing the organization at formal events?

Answer: Figurehead

The figurehead role is a ceremonial interpersonal role where the manager acts as a symbolic head of the organization.

Which internal control activity involves checking that two different departments' records agree with each other?

Answer: Reconciliation

Reconciliation compares records from two independent sources to identify discrepancies, such as matching bank statements to ledger balances.

An employee discovers that a colleague is submitting false expense claims. According to professional ethics, what should the employee do first?

Answer: Follow the organization's whistleblowing or internal reporting procedures

Internal reporting procedures should generally be the first step, as organizations are expected to have channels for raising concerns about misconduct.