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CIMA Fundamentals of Ethics - Corporate Governance and Business Law Sample Questions:

1. CIMA's Code of Ethics would be violated if a professional accountant accepted a fee for work which is:

A) based on a quotation fixed in advance of the work being earned out
B) payable once a specified finding has been attained
C) fixed by a company's ethics committee
D) based on a price quotation submitted in competitive bidding

2. The CIMA Code of Ethics relates to:

A) Professional accountants in public practice only
B) Professional accountants in the third sector only
C) Professional accountants in business only
D) Professional accountants in public practice and business

3. Which of the following courses of action is NOT part of the process that the CIMA Code of Ethics expects of professional accountants in resolving an ethical conflict?

A) Determine the appropriate course of action that is consistent with the fundamental principles identified
B) Consult with other appropriate persons within the firm or employing organization for help if the matter remains unresolved
C) Evaluate the consequences of each possible course of action
D) Proceed with the course of action that would do least damage to a professional accountant's career prospects

4. As a member of the audit team of a large company, J has discovered that one of his close friends is in a part of the business which is going to be sold off, and his friend is likely to face redundancy. What should he do?

A) Tell his friend: he has an obligation to his friendship
B) Resign: J can't carry on working at the company whilst he is personally compromised
C) Do nothing: professionally, J is bound to respect the confidentiality of the information he has received
D) Leak the information: that way he can let his friend know, but the information won't be traced back to J

5. S is assistant management accountant for a large telecommunications company. S has become aware that the company is offering different levels of discount to different corporate customers. S is concerned that this is unethical, so she mentioned it to the Finance Director during her most recent appraisal. The Director seemed amused at S's concern, and said that such a situation was 'perfectly normal'.
Which ONE of the following would it be appropriate for S to do?

A) Ask for advice from the company's external auditors
B) Bring the matter to the attention of the Managing Director
C) Ask for confirmation in writing from the Director
D) Request a further meeting with the Finance Director
E) Resign
F) Nothing further

Solutions: