CIMA Business Ethics and Corporate Governance 3

Question 1

Which ethical theory holds that the morality of an action is determined solely by its consequences or outcomes?

Accepted Answer

Consequentialism

Answer

Deontology

Answer

Virtue ethics

Answer

Rights-based ethics

Question 2

In corporate governance, what is a 'non-executive director's' primary function?

Accepted Answer

Providing independent oversight and challenge to executive management

Answer

Managing day-to-day business operations

Answer

Signing off on all financial transactions

Answer

Preparing the company's financial statements

Question 3

Under CIMA's Code of Ethics, the principle of 'confidentiality' prohibits which of the following?

Accepted Answer

Using client information for personal advantage

Answer

Seeking legal advice about ethical dilemmas

Answer

Disclosing non-sensitive publicly available information

Answer

Reporting suspected money laundering to authorities

Question 4

Which governance model places greatest emphasis on stakeholder interests rather than just shareholder value?

Accepted Answer

Rhineland (stakeholder) model

Answer

Anglo-American model

Answer

Agency model

Answer

Shareholder primacy model

Question 5

What does 'tone at the top' refer to in corporate governance?

Accepted Answer

The ethical climate and culture set by senior management and the board

Answer

The volume of board meeting discussions

Answer

The hierarchy of authority in an organization

Answer

The formal reporting structure of the finance team

Question 6

Which of the following best describes the purpose of an 'internal control system' in an organization?

Accepted Answer

To provide reasonable assurance that objectives are achieved and risks are managed

Answer

To eliminate all business risks

Answer

To replace the role of external auditors

Answer

To prepare accurate financial statements