CAT CAT Business Ethics & Professional Standards 2

Question 1

Which of the following is an example of a 'self-interest threat' to objectivity for an accounting technician?

Accepted Answer

Owning shares in a client's company

Answer

Holding a financial interest in a client creates a self-interest threat because the technician may bias work to protect that investment.

Question 2

When a CAT realizes they lack the expertise to complete an assigned task competently, they should:

Accepted Answer

Disclose the limitation and seek additional training or expert assistance

Answer

Professional competence requires acknowledging skill gaps and obtaining necessary guidance before proceeding.

Question 3

What is the purpose of a whistleblower protection policy in an accounting firm?

Accepted Answer

To encourage employees to report unethical conduct without fear of retaliation

Answer

Whistleblower policies protect staff who report violations from adverse employment actions, supporting an ethical workplace culture.

Question 4

Which of the following best describes 'professional skepticism'?

Accepted Answer

Questioning and critically assessing evidence rather than accepting it at face value

Answer

Professional skepticism means maintaining a questioning mind and rigorously evaluating evidence during accounting and audit work.

Question 5

A CAT is offered a gift worth $500 by a client after completing their annual accounts. According to ethical standards, the technician should:

Accepted Answer

Decline the gift to avoid compromising independence

Answer

Accepting significant gifts from clients can create a self-interest threat and undermine the technician's objectivity.

(CAT) Certified Accounting Technician Practice Test