Exam 10: Ethical Decision Making: Corporate Governance, Accounting, and Finance

Which of the following legal duties of board members suggests that a director does not need to be an expert or actually run the company?

Board members are permitted to act in a way that is inconsistent with the central goals of the organization.

Which of the following statements is true of conflicts of interests?

Sara, an employee of PentaComp Inc., passed on confidential information of her company to her friend. Her friend benefitted from selling PentaComp's stock based on the information shared by Sara. In this scenario, Sara can be convicted of ____.

Since audits are paid for by audited clients, there is an inherent conflict found in that financial arrangement.

The COSO controls and the Sarbanes-Oxley requirements must be supported by a culture of accountability.

According to the COSO framework, which of the following is true of internal control?

COSO is one of the first efforts to address corporate culture in a quasi-regulatory framework in recognition of its significant impact on the satisfaction of organizational objectives.

Section 307 of the Sarbanes-Oxley Act addresses the:

The function of auditors as gatekeepers is to:

Which of the following is an internal mechanism that seeks to ensure ethical corporate governance?

Which of the following statements is true of the Committee of Sponsoring Organizations?

Which of the following scenarios gives rise to conflicts of interests in corporate governance?

A ____ exists where a person holds a position of trust that requires that he exercise judgment on behalf of others, but where his personal interests conflict with those of others.

The Sarbanes-Oxley Act is intended to provide protection where oversight did not previously exist.

Tom, an employee of Electronixx, adjusted credits and debits of the company's ledger to show high profits. He also created false documents, underreported his income, and evaded paying taxes for a year. Tom can be convicted for ____.

Financial analysts rely on gatekeepers but are not gatekeepers themselves.

Which of the following is true of the COSO controls and the Sarbanes-Oxley requirements?

Explain Enterprise Risk Management-Integrated Framework.

Insider trading may be based on a claim of unethical misappropriation of ____, that is, knowledge only those in the firm should have.