Corporate Governance and Ethics Flashcards
7 cards from real ACCA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Corporate Governance and Ethics flashcards as text
The Sarbanes-Oxley Act (SOX) Section 302 requires:
Answer: CEOs and CFOs to personally certify the accuracy of financial reports
SOX Section 302 requires the CEO and CFO to personally certify the accuracy and completeness of financial reports filed with the SEC.
In Kohlberg's model of moral development, an individual operating at the 'post-conventional' level makes ethical decisions based on:
Answer: Universal ethical principles and personal conscience
At the post-conventional level, moral reasoning is guided by universal ethical principles that may even supersede established laws.
Which governance model is characterized by a two-tier board structure with a supervisory board and a management board?
Answer: German/Continental European model
The German/Continental European model uses a two-tier structure: a supervisory board that oversees the management board responsible for day-to-day operations.
A director is said to have a 'fiduciary duty' to a company. This duty primarily means the director must:
Answer: Act in good faith in the best interests of the company
A fiduciary duty requires directors to act honestly, in good faith, and in the best interests of the company as a whole.
Which of the following is a PRIMARY role of the nomination committee?
Answer: Identifying and recommending candidates for board appointments
The nomination committee leads the process for board appointments, ensuring the board has the right balance of skills, experience, and diversity.
The concept of 'enlightened shareholder value' (as reflected in the UK Companies Act 2006, s.172) requires directors to:
Answer: Consider stakeholder interests as part of promoting long-term shareholder success
Section 172 requires directors to act in good faith to promote the company's success for shareholders while having regard to other stakeholders and long-term consequences.
An auditor who owns shares in a client company faces which type of threat to independence?
Answer: Self-interest threat
Owning a financial interest in a client creates a self-interest threat, as the auditor has a personal financial stake in the client's reported results.