Sample Question BBI-merged

Financial Services management BBI Sem V
1. There are _____ parties involved in the contract of pledge.

2. The one who pledges the asset is called as _____.
3. The one who grants a loan against collateral is called as Pawnee :
4. A bank included in the _____ schedule of the RBI Act 1934, is eligible to become depository.
5. NSDL was inaugurated on November, 08 _____.
6. A depository system is governed by _____ act.
7. A depository company must have a minimum net worth of ` _____ crore.
8. Informal credit is type of
9. The person who is having goods in his/her possession known as
10. Cash and carry is the type of
11. The compensation given by the insurance company known as
12. The third copy of credit card is required to send to the
13. The entrance fee is necessary for
14. The person who work on the behalf of a principle known as
15. Breaking bulk is the function of
16. NHB stands for
17. National Housing Bank was set up on _____.
18. National Housing Bank was set up on July 9, 1988 under which among the following acts
19. HFC stands for :
20. _____ is an apex financial institution for housing.
21. The Head Office of National Housing Bank is at
22. The National Housing Bank (NHB) was set up in India as a wholly-owned subsidiary of
23. The markets in which the derivatives are traded are classified as
24. The situation in which the large portion of majority is borrowed from the broker of
25. The type of contract which involves the future exchange of assets at a specified price is
classified as :
26. The type of unit which guarantees that all the buying and selling will be made by traders of
exchange is called
27. The example of derivative securities is :
28. Financial derivatives include :
29. A contract that requires the investor to buy securities on a future date is called as :
30. The payoffs for financial derivatives are linked to
31. Hedging risk for a short position is accomplished by
32. _____ number of stages involved in securitization.
33. _____ type of structure is mostly prevalent in mortgage backed securities.
34. SPV stands for _____
35. _____ stocks are instruments issued by a subsidiary company against the trade debt and
consumer receivables of the parent company.
36. _____ type of transaction defines two day delivery.
37. All bonds are ________.
38. _____ can be described as a tax levied on all documents of a commercial nature.
39. Duration of forward transaction _____
40. Swap, spot, futures etc. come under the category of _____
41. Factoring service is considered only in respect of receivables on account of
42. Maturing factoring involves
43. _____ is a short–term solution.
44. The grace period in bill discounting is ______ days
45. International forfeiting transactions are dominated in ________ countries
46. _____ is a Long–term solution.
47. A mutual fund is owned by____
48. The NAV of a mutual fund
49. An open-ended mutual fund is one that has
50. An investor in a close-ended mutual fund can get his/her money back by selling his/her units :
51. A mutual fund is not
52. The NAV of each scheme should be updated on AMFI's website
53. Mutual funds are allowed to borrow
54. Who among the following are not eligible to invest in MF
55. What document Mutual Fund distributors need to refer for finding out eligible category of
investors in a particular Mutual Fund Scheme
56. Investments made by a mutual fund on behalf of investors are accounted as
57. The type of funds whose main objective is to hold an optimal mix of investments among cash,
equities, and income-producing securities is called as
58. The type of funds whose main objective is to concentrate its holdings in one particular sector,
geographic region, or in one capital market is called as
59. Mutual Fund organisation does not involve
60. Which of the following is a type of Factoring
61. Which of the following is not a part of the factoring transaction
62. The type of fund whose main objective is to provide a steady stream of income, and holds
bonds issued by either governments or corporations is called as
63. The type of fund whose main objective is to provide long-term growth through equity/stock
investments is called as
64. Mutual fund organisations include
65. Which of the following is a type of factoring
66. Following is a party to factoring transaction
67. A merchant bank is a financial institution conducting money market activities and
68. Formal merchant banking activity in India was originated in _____.
69. In India, merchant-banking activity was originated with the merchant banking division set up
by the _____
70. State Bank of India started merchant banking in _____
71. ICICI bank started merchant banking in _____
72. The early growth of merchant banking in the country is assigned to the _____.
73. The term ‘Merchant Bank’ is used in :
74. _____ is regarded as the fourth element of the financial system.
75. _____ number of parties are involved in forfeiting.
76. _____% of the GDP is domestic consumption–based.
77. There are _____ numbers of stages of venture in financing offered in venture capital.
78. In _____ there is no statutory requirement for registration.
79. Financial services is usually _____ focused.
80. Following is importance of Financial services.
81. Following is the Non fund based Service
82. Following is not the Fee based service
83. From the following who cannot act as a Merchant Banker
84. Four major constituents of Financial Service market does not include
85. NBFC is incorporated under
86. Following is a Fee based Service
87. Mutual Fund market is controlled by
88. Share Market is controlled by
89. Which of the following stock exchange is operational in India
90. NHB has been established with an objective to
1. Operate as a principal agency to promote housing finance institutions.
2. promote housing finance institutions both at local and regional levels.
3. provide financial and other support incidental to such institutions and for matters
connected therewith.
4. Give housing loans to urban poor
91. Which of the following is a Depository participant operating in India
1. ICICI Securities
2. HDFC Securities
3. JP Morgan Securities
4. Religare Securities
5. Zeroda
92. Which of the following Indian conglomerate has its presence in all , Banking, Insurance &
Asset Management
1. ICICI
2. HDFC
3. Kotak
4. Birla
93. Which of the following documents are required for completing the KYC process
1. Age proof
2. Address Proof
3. Photo ID
4. Marriage certificate
94. KYC process is required for availing which of the following services.
1. Opening a Bank a/c
2. Opening a Demat a/c
3. Purchasing Gold ornaments worth INR 1 lakh
4. Purchasing Units of a mutual fund scheme
5. Purchasing Life Insurance policy
95. A permanent account number can be used for what of the following
1. Age proof
2. Address proof
3. Photo ID
96. A mutual fund scheme has INR 1 crore as total assets under management with zero liabilities.
It has a total of 1,00,000 unit outstanding as of 31st march 2020. Calculate the NAV as on 31st
march 2020.
97. Mr Natvarlal purchase 1000 units of a mutual fund scheme with INR 100 lakhs as total assets
under management and a NAV of INR 10. What will be the total AUM of the scheme after
the investment made by Mr. Natvarlal
98. Mr A is 36 years of Age and is the only earning member of his family consisting of his
Parent ( father aged 64 years & mother aged 59 years ) , his wife Aarti aged 32 years. He also
has a son, Raul aged 8 years. His total Annual income is 10 lakh P.A. as per you what should
be the appropriate life Insurance cover Mr A should have
99. Which of the policies are offered by General Insurance companies operating in India
1. Motor Insurance policies
2. Endowment policies
3. Money back policies
4. Fire Insurance policies
International banking & Finance
1. The market where dealing in currencies take place is called as ______

2. The artificial currency created by IMF to be used as supplementary reserve Assets is called
as_______
3. Difference between the value of merchandise exports and imports is called _______
4. Broad measure of a country’s international trade in goods & services are called
5. Account reflecting changes in country ownership of long term and short term financial assets
are called
6. _________ is a sum of all invisible service receipts and payments in which the sum could be
positive or negative or zero.
7. When a country experiences _______ , its interest rates are likely to fall
8. Which of the following is not an advantage of full capital account convertibility?
9. Under a gold standard ______
10. International Bank for Reconstruction and development is also popularly called as _______
11. The ________ is an International reserve asset, created by the IMF in 1969 to supplement its
member countries official reserves
12. ________ regulates SDRs which would accept as reserves and use for settlement of
International payments.
13. The Smithsonian agreement was abandoned in March _______
14. The collapse of the following system is related to Triffins paradox
15. A floating exchange rate _________
16. The current system of International finance is
17. ________ is the act of trading different currencies
18. In a floating exchange rate system, the market clears itself through a __________
mechanism.
19. In a _________ exchange rate system the government or central bankers intervene to keep
the exchange rate virtually fixed.
20. The exchange- rate system that best characterizes the present international monetary
arrangement used by industrialized countries is
21. Which exchange rate system does not require monetary reserves for official exchange rate
intervention?
22. In a _____________ a foreign company issues Bond denominated in a currency which is not
the home currency of the investors
23. __________ refers to a bond issued & sold outside the home country of currency.
24. ___________ refers to an investment in or getting hold of foreign assets with the aim to
control and manage them
25. ___________ is an Investment that a parent company makes in a foreign country
26. ___________ is an investment made by an investor in the markets of a foreign nation
27. _________ bonds are the bonds floated in the domestic market denominated in domestic
currency by non – resident entities
28. GDR’s can be converted into shares , Shares can be converted into GDR’s. this is called _____
29. In the case of an _______ offerings the bonds convert into shares of the company that
issued the bonds
30. In case of an _______ offering, the bonds are convertible into shares not of the issuer
company, but that of another company forming part of its group.
31. ________ is a negotiable instrument issued by the international depository bank
representing foreign company’s stock trading globally.
32. _________ allows foreign companies to mobilize funds from Indian Market.
33. SEBI has set _____ as the lower limit for the IDRs to be issued by the Indian companies.
34. The minimum investment required in the IDR issue by the investors has been fixed at ______
by SEBI
35. ___________ is issued locally by a domestic borrower usually denominated in the local
currency.
36. A Japanese company issuing bonds in Yen currency in Japan is an example of _________
37. __________ is issued in a local market by a foreign borrower – usually denominated in the
local currency.
38. A Japanese company issuing US dollar denominated bonds in the US market is example of
_____
39. ___________ placed mainly in countries other than the one in whose currency the bond is
denominated
40. A Japanese company issuing Yen denominated bond in th US market is example of ______
41. The main risk associated with domestic bonds is the risk of _______
42. In case of _________ offering , the bonds convert into shares of the company that issued
the bonds.
43. __________ are instruments issued by registered foreign institutional investors(FII) to
overseas investors ,who wish to invest in the Indian stock markets without registering
themselves with the market regulator, SEBI
44. Forex market play a critical role in facilitating _____
45. An act which is enacted to regulate payments and foreign exchange in India is _____
46. _________ an act initiated to facilitate external trade and payments and to promote orderly
management of the forex market in the country.
47. All operational aspects of interbank market are governed by guidelines and code of conduct
of _______
48. Function of FEDAI is _______
49. RBI and FEDAI issue guidelines to all banks regarding risk to risk to ______
50. If the bid points are higher than the ask points, the spot rate has to be made _____ to find
the forward rates.
51. If the bid points are lower than the ask points , the spot rate has to be made _________ to
arrive at the forward bid ask rate.
52. Bid – Ask spread of forward rate is always-______ than the spot bid ask rates.
53. Sum of the bid- ask spreads of the spot rate and forward points should _____ the bid-ask
spread of the forward rate.
54. This rate denotes the number of units of a currency a bank is willing to pay when it buys
another currency is called________
55. This rate denotes the number of units of currency a bank will want to be paid when it sells a
currency is called ______
56. Price of foreign currency in terms of national currency is _______quote
57. Price of national currency in terms of foreign currency is ______ quote
58. The risk of an exchange rate changing between the transaction date and the subsequent
settlement date is called ______
59. When a country experiences _________ its interest rates are likely to fall
60. __________is a financial risk that exists when a financial transactions is denominated in a
currency other than that of a base currency of the company
61. ________ is where you can buy and sell a currency, at a fixed future date for a pre
determined rate.
62. The process through which the treasurers try to reduce/eliminate the loss that may result from
an adverse movement of foreign exchange rates ________
63. The risk that a government may default on its debt obligation __________
64. Trade between companies in two different countries is called as ________
65. _________ play an important role in strengthen the banking Sector
66. The process of recording of transactions through the utilisation of processing power
computer_______
67. Alternative virtual currency which is similar in functioning as Bitcoin
68. The first and the most popular virtual currency which can be stored in E – Wallet
69. The first virtual currency which was released for smooth peer to peer transaction ______
70. The crypto transactions are verified by network nodes and recorded in a public distributed
ledger called as ________
71. The electronic payment system through which forex remittances are made is _____
72. _______ is an NRI account that can be opened by depositing foreign currency in the account.
73. _______ is a rupee denominated NRI ac
74. __________ are fixed deposit NRI a/c
75. Pre shipment finance is also called as _____ credit.
76. Assurance given by the importers bank about the financial credibility of the borrower is
called as ________
77. A letter off credit that can be used for multiple transactions where the credit limit is not
fixed is a ________ L/C
78. The bank which opens the letter of credit in favour of beneficiary is known as ______
79. There is a ________ loan agreement in case of a syndicated loan
80. The loan amount contributed by several lenders in a syndicated loan
81. Which of the following is /are disadvantages of Floating exchange rate
1. Increase volatility
2. Increase the exchange rate risk
3. Inflationary pressure
4. Market forces of demand & supply
5. Speculative capital movements
82. Which of the following are the features of Bretton Woods system
1. USD as a Universal reserve asset
2. The Nixon Shock
3. Fixing value of Gold in USD
4. Unconditional guarantee by US federal Reserve Bank
5. IMF assistance
83. Which of the following is a Type of Risk associated with International Investments.
1. Default risk
2. Bank Risk
3. Foreign Risk
4. Interest rate risk
5. Political Risk
84. Bond market is divided into which of the following three categories
1. Domestic Bonds
2. Foreign Bonds
3. Indian Bonds
4. Euro Bonds
5. Asian Bonds
85. Calculate Inverse quote
GBP 1= INR 99.1100/99.9900
86. If USD INR = 60.2530/60.2528
GBP/USD =1.6260/1.6265
Find GBP INR
87. EUR USD =1.5160/1.5220
Calculate Midrate & Spread
88. You are given the following USD quotes
Spot INR 60.50/60.60
2 month Forward 0.20/0.10
Calculate 2 months forward rate
89. Which of the following are advantages of using foreign currency swaps
1. Adjusting mismatch of Maturities
2. Providing optimum borrowing arrangements
3. Funding foreign currency accounts
4. Give guaranteed returns
5. Eliminate rate risk in Investment transactions
90. Which of the following influences profitability in International lending
1. Exchange rate
2. Interest rate
3. Hedging tools
4. Investment avenues
5. Forex regulations
RESEARCH METHODOLOGY
TYBBI SEM 5
1. Research is search for __________
2. ____________ of research is to identify the problem
3. Applied research is ____________ oriented.
4. ___________ research establishes cause and effect relationship
5. Two variables are called __________ Variables.
6. Qualitative research is ______________
7. Research design is a ____________ of the whole research activity.
8. _____________ hypotheses establish no relationship among variables.
9. Sampling involves both design choice and ________ size.
10. In __________ sampling method, sample units are selected at random.
11. __________ is obtained by selecting ‘convenient’ population unit.
12. __________ is a type of non-random sampling and is also called purposive sampling or
deliberate sampling.
13. __________ is a non-probability samples in which selection of additional respondents is
based on referrals from the initial respondents.
14. __________ methods are those in which every item in the universe has a known chance, or
probability, of being chosen for the sample.
15. __________ creates the foundation of the entire research work.
16. __________ is determined before data are collected.
17. __________ is any process of preparing and collecting data.
18. __________ is research done simply to find out something by examining anything.
19. ___________ is a specific type of research that involves critical thinking skills and the
evaluation of facts and information relative to the research being conducted.
20. Primary data is ____________
21. Observation method gathers ___________ data.
22. In _______________ observation subjects do not know they are being observed.
23. ______________ is the procedure to test questionnaire.
24. _______________ data is also known as recorded data from published sources.
25. Response rate is __________ in personal interview technique.
26. Too much dependence on secondary data is __________.
27. For telephone survey, the questionnaire should be ______________.
28. Experimental method of data collection is ____________ and ___________.
29. Sample is a small representative of the _____________ population.
30. In Multiple choice questions, choice given restricted to _____________.
31. Pilot questionnaire is followed by _____________ questionnaire.
32. Limitation of primary data is that it is ______________.
33. Limitation of secondary data is that it is _____.
34. The method of collecting data through mailing of questionnaires to respondent is called
____________.
35. Before using _____ method, it is always advisable to conduct ‘pilot study’
36. ___________ questionnaires are those in which the questions are definite.
37. In __________ fixed alternatives answers are given so respondent can choose appropriate
one.
38. _____________ questions are designed to allow free response on the subject where the
issue is identified.
39. Dichotomous questions are also called as ______________.
40. Data processing does not consist of _____.
41. __________ is an abbreviation - a number of an alphabet
42. While editing the following point must be scrutinized
A. Whether the data is reliable and accurate
B. Whether all questions have been answered
C. Whether all the schedules are uniform
D. Whether the data is reliable and accurate, whether all questions have been
answered, whether all the schedules are uniform.
43. One of the essentials of coding is __________
44. One of the essentials of table is ___________
45. ______________ refers to the task of drawing inferences from the collected facts after an
experimental study.
46. Interpretation of the data has become a very important because of ________________.
A. More understanding
B. findings the reasons
C. in-depth knowledge
D. More understanding, findings the reasons, in-depth knowledge
47. ______________ analysis refers to statistically describing, aggregating, and presenting the
constructs of interest or associations between these constructs.
48. Coded data can be entered into__________.
49. __________ analysis refers to a set of statistical techniques that can describe the general
properties of one variable.
50. __________ analysis examines how two variables are related to each other.
51. __________ compares a sample mean to a known population mean.
A. Paired Samples T-Test
B. One-Sample T-Test
C. ANOVA technique
D. F-test
52. __________ compares two sample means from the same population regarding the same
variable at two different times.
C. ANOVA technique
D. F-test
53. __________ is used to investigate any number of factors which are hypothesized or said to
influence the dependent variable.
C. ANOVA technique
D. F-test
54. __________ can be used to test the hypothesis that the population variances are equal.
C. ANOVA technique
D. F-test
55. Data processing is the conversion of ______________ data to meaningful information.
56. ________________ is the process of eliminating errors.
57. _________________ saves time during data analysis
58. Editing of data is a ______________ job.
59. Interpretation is the _____________ of the research process.
60. _____________ is the middle value.
61. A statistical tool with the help of which we can find the degree of relationship that exists
between two or more variables is technically called _____________.
A. Correlation
B. Regression
C. Causation
D. Coefficient of determination
62. The correlation of a sample is represented by the letter ______________.
63. If there is no correlation between the two variables, then it is called _______________
correlation.
64. The range of possible values for a correlation is between___________.
A. -1 to +1
B. 0 to + 1
C. -1 to + 0
D. -2 to +1
65. _____________is a statistical method with the help of which we can estimate value of one
variable for the given value of the other variable.
66. Application of regression is found in _________________.
A. Predictive Analytics
B. Operation Efficiency
C. Supporting Decisions
D. Predictive Analytics, Operation Efficiency, Supporting Decisions
67. Factor analysis is a technique that requires a _______________ sample size.
68. _____________ analysis is used when we believe that the sample units come from an
unknown number of distinct populations or sub-populations.
69. ____________ analysis is a multivariate method which aims to classify a sample of subjects.
70. ___________ analysis is a visual representation of distances or dissimilarities between sets
of objects.
71. “Objects” can be __________.
72. _____________________the last activity of the research process.
73. A research report provides _____________ about a particular matter or subject.
74. A written format of a research work is known as ________________.
75. A main body of report includes _____________.
76. Title page includes ________.
A. Name of the candidate
B. Submission Month & Year
C. Title of the thesis
D. Name of the candidate, Submission Month & Year, Title of the thesis
77. Reference material includes ________.
78. ____________includes the acknowledgement to the persons and sources that have been
helpful to the investigator.
79. ____________ lists all the main chapter headings and the essential sub-heading in each with
the appropriate page numbers against each.
80. ____________ consists of the titles or captions of the tables included in the thesis along with
the page number where these can be located.
81. ____________ is the last section of the research report.
82. Technical report is ____________ to understand.
83. _____________ is designed for publications in a professional journal.
84. _________________ constitute the heart of research report.
85. Research abstract is a summary of _______________ report.
86. Match List-I (Interviews) with List-II (Meaning) and select the correct answer from the code
given below:
List - I (Interviews) List - II (Meaning)

(a) structured interviews (i) greater flexibility approach
(b) Unstructured interviews (ii) attention on the questions to be answered
(c) Focused interviews (iii) individual life experience
(d) Clinical interviews (iv) Pre determined question
(v) non-directive
87. Which of the following options are the main tasks of research in modern society?
(I) to keep pace with the advancement in knowledge.
(II) to discover new things.
(III) to write a critique on the earlier writings.
(IV) to systematically examine and critically analyse the investigations/sources with
objectivity.
a. IV, II and I
b. I, II and III
c. I and III
d. II, III and IV
88. From the list given below identify those which are called Non-probability sampling
procedures’:
(i) Simple random sampling
(ii) Dimensional sampling
(iii) Snowball sampling
(iv) Cluster sampling
(v) Quota sampling
(vi) Stratified sampling
89. The components of a research design are:

(a) Comparison
(b) Control
(c) Reactivity
(d) Manipulation
(e) Non representativeness
(f) Generalization
90. In the list given below, identify those statements which correctly describe the meaning and
characteristics of research.
(i) Research is a method of improving our common sense.
(ii) Deductive and inductive methods get integrated in a research process.
(iii) Research is creativity and charisma.
www.netugc.c om
(iv) Research is the use of scientific method to provide answers to meaningful questions.
(v) Method of consulting and using experience is called research.
(vi) The answers provided by research can be empirically verified.
Choose the correct answer from the code given below:
Code:
a. (ii), (iv) and (vi)

b. (i), (ii) and (iii)
c. (iv), (v) and (vi)
d. (i), (iii) and (v)
91. There are two sets given below. Set – I specifies the types of research, while Set –II
indicates their characteristics. Match the two and given your answer by selecting the
appropriate code.
Set – I (Research types) Set – II (Characteristics)
(a) Fundamental research (i) Finding out the extent of perceived impact of an intervention
(b) Applied research (ii) Developing an effective explanation through theory building
(c) Action research (iii) Improving an existing situation through use of interventions
(d) Evaluative research (iv) Exploring the possibility of a theory for use in various
situations
(v) Enriching technological resources
92. Which of the sets of activities best indicate the cyclic nature of action research strategy?
(1) Reflect, Observe, Plan, Act
(2) Observe, Act, Reflect, Plan
(3) Act, Plan, Observe, Reflect
(4) Plan, Act, Observe, Reflect
93. In which of the following activities, potential for nurturing creative and critical thinking is
relatively greater?
(1) Preparing research summary
(2) Presenting a seminar paper
(3) Participation in research conference
(4) Participation in a workshop
94. Which of the following is the most likely code book entry for a three point satisfaction
scale?
a. 1= satisfied, 10= very satisfied, 100= extremely satisfied
b. 1= satisfied, 2= extremely satisfied, 3=extremely dissatisfied
c. 1= dissatisfied, 3= satisfied, 5= very dissatisfied
d. 1=dissatisfied, 2= neither dissatisfied or satisfied, 3= satisfied
95. ‘Please circle your main mode of transport to university: 1: Walk, 2: Bicycle, 3: Bus; 4:
Train; 5: Car, 6: Other’. This question is _________.
Strategic Management TYBBI Sem V: Sample Questions
Unit 1:
1) The elements of strategic Management are ----

2) ______ in one of the three parts of Strategic Choice.
3) BCG matrix quadrant has the following quadrants---
4) The element not in the list of the McKinsey 7S model are ----
5) -------are units or products that have both a low market share and a low growth rate.
6)_____ factor affects Industry attractiveness.
7) McKinsey 7 –S Framework was developed by -----
8) In McKinsey 7Ss models hard elements include ----
9) Porter's five forces includes ----
10) The business units or products that have the best market share and generate the most
cash are considered as ------------
11) Horizontal Integration is considered with ___________
12) ___________ refers to formal & informal rules, regulations that complement the
company structure.
13) Micro environment is the __ environment of a company.
14) ______ enables the strategists to take corrective action at the right time.
15) ___________ is the direction & scope of an organization over the long term.
16) The highest level of strategic decisions is taken at __________ level.
17) The first step in the process of Strategic Management is _______.
Unit 2 :
1) The process of collecting scrutinizing and providing information for strategic

2) ------ is a part of consumer protection Act.
3) To ensure fair and regular return on investments is the social responsibility of business
towards—
4) ------ is a law to protect workers.
5) Reduce carbon emissions ------is part of Business Environment
6) -------------is formulated at the top level by the top management.
7) _____ factor affects Business Unit Strength.
8)------- is an action that managers take to attain one or more of the organization’s goals.
9) Changes in the government policy is the -------- factor Affecting Business.
10) To provide fair and just wages and allowances is the social responsibility of business
towards—
11) Like roots of a tree, ___________ of organization is hidden from direct view.
12) Changes in Company__________ also necessitates changes in the system in various
degrees.
13) Criteria making an evaluation is ____________.
14) The major issue of appraisal system is __________
15) _______ is the process by which a firm manages the formulation & implementation of
its strategy
16) Which is not a part of strategy formulation?
17) ______________ is not a part of International Strategy life cycle.
UNIT 3
1. The fundamental purpose of an organization’s mission statement is to __________.
2. The acronym SWOT stands for _______________.
3. Which of the following is an issue considered in developing corporate strategies?
4. Competitive advantage can best be described as:
5. ________________ is the foundation of blue ocean strategy.
6. The primary focus of strategic management is:

7. Which of the following defines what business or businesses the firm is in or should be
in?
8. Which of the following focuses on supporting the corporate and business strategies?
9. Which one of the following is at the core of strategic management?
10. The corporate level is where top management directs:
11. _____________ strategy is a Corporate level strategy.
12. _____strategy involves redefining the business
13. The reasons for acquisitions are ________
14. Market Research is conducted by _________________
15. Vertical Integration is concerned with ____________
16. ETOP stands for ____________.
17. ______________ cost accounting measures the cost of producing & ignores the cost of
non-producing.
Unit 4:
1. Sudden change in government, natural calamities, terrorist attacks, industrial disasters

can be controlled through ____________.
2. Which of these requires combination among many people?
3. Which is not the criteria for strategic audit?
4. Process pertaining to development & delivery of product(s) and/or services does not
include _________.
5. Programmes lead to the formulation of _________.
6. _________ is meant for replacement of the old process by altogether new one to
achieve dramatic improvement in the performance.
7. Which of these focuses on effectiveness?
8. Which is not the type of organizational control?
9. _________ are the desired end results of the redesign process which the management
and organization attempts to realize.
________ helps in improving performance by learning from the best practices & the
processes by which they are achieved.
10. Financial environment is concerned with ____________

11. Harvest strategy is used for ____________.
12. Which step of the process model is about consumers?
13. How many different levels of strategy are there?
14. Where does feedback occur?
15. Which level is about business units?
16. _____________ is the process of seeking information about relationship &

events in the external environment.
Unit 5
1. What is happening to strategy evaluation with the passage of time?
2. The process of finding out the effectiveness of strategic control is through ______
3. Control can be exercised with the help of _________.
4. Evaluation of plan, policies and programmes is done through ________
5. The first step in the Strategic evaluation process is _________
6. Company’s ability to follow a plan is a ____________ factor.
7. The primary external force for a company is ________

8. Adjusting strategic operations is an essential technique of ___________
9. _____________controls may be either manual or automated, and can involve people,
processes, and technology.
10. The __________ is a strategic planning and management system that
organizations use.
11. The _____________perspective looks at your overall corporate culture
12. The _________perspective focuses on the people who actually buy your
products and services.
13. The _____________perspective looks at how smoothly your business is
running.
14. ____________ is the barrier for which strategic evaluation and control (SEC)
system fails
15. According to Kaplan and Norton, what should be the main perspective of the
balanced scorecard?
16 ______________________ proposed the concept of Balanced Score card.
17. Norton and Kaplan recommend that a separate balanced scorecard be developed
for
1. Choose the correct sequence Decision making process.

2. Choose the correct sequence of the Strategic Management Process
3. Choose the correct option regarding the Micro External Environment

4. Choose the correct option regarding strengths in SWOT Analysis.
5. Choose the correct sequence for strategic choice
6. Choose the correct option regarding vertical integration
7. Choose the correct sequence of strategy implementation
8. Choose the correct option regarding advantages of Matrix Structure
9. Choose the correct sequence of Benchmarking
10. Choose the correct sequence of strategic control

Auditing
(1) ____---means the auditor should not disclose this information of the client
anywhere outside India
(2) When the transaction has been entered in the books wrongly it is called as error of
_____________.
(3) Audit of small enterprise is generally known as ____________
(4) Audit conducted between two annual audits is called as ____________.
(5) ________________ means showing the books of accounts attractive
(6) Auditor must inform the registrar in writing of his acceptance or refusal of the
appointment within _______ from the days from the receipt of appointment of
letter
a. 30 days b. 45 days c. 35 days d. 20 days
(7) _______________ is a book, which is maintained by audit staff

a. Audit note b. Working Paper c. Audit Programme d.
Client’s book
(8) Audit Planning refers to developing an overall plan for ________________.

a. Scope& conduct of audit b. Potential Problems c. Resources d.
Financial Planning
(9) _________% of total deposits should be covered under concurrent audit

a. 50 b. 60 c. 70 d. 80
(10) _____________ is refer to record of observing, summaries, and comments of
auditor
a. Working Paper b. Audit Programme c. Audit notebook d.
Annual Report
(11) _____________ means part of profit kept aside for future use
a. Window dressing b. Secret reserve c. confidentiality d.

Working papers
(12) When the same transaction is recorded twice in the book it is called as Error
of ___________.
(13) Statutory Auditor is responsible for ____________
(14) Audit Conducted continuously as transaction takes place is ____________.
(15) The primary objective of Audit is _______________
(16 ) Information about client’s business can be collected from

________________.
(17 ) Trial balance is part of_____________ audit file
(18) MOA is the part of _______ audit file
19) Before the work of Audit is commenced, the auditor plans out the whole of
audit work is called __________
(20) In large organizations it is impossible to check each transaction and it is

known as ________
(21) Which of the following is not one of the three main reasons why the auditor
should properly plan engagements?
22. The main object of an audit is ___
23. A sale of Rs. 50.000 to A was entered as a sale to B. This is an example of _
24. As per AAS-4 if auditor detects an error then______
25. The most difficult type of misstatement to detect fraud is based on:
26. In India, balance sheet audit is synonymous to-
a) Annual audit
b) Continuous audit
c) Detailed audit
d) Statutory audit
27. Balance sheet audit includes verification of_
28. Balance sheet does not include-
29. Of the following, which is the least persuasive type of audit evidence?
The working papers which auditor prepares for financial statements audit are : _
30. The quantity of audit working papers complied on engagement would most
be affected by-
31. The current file of the auditor’s working papers, generally, should include-
32. Which of the following methods of sample selection is least suitable for
extrapolating results to the population?
33. Who is responsible for the appointment of statutory auditor of a limited

company?
34. Auditing ends when ______ starts
35. Auditor should be dutiful like a _______
36. The independent auditor’s primary responsibility is to______________
37. Which of the following are you unlikely to see in the current file of
auditors’ working papers______
38. ______ followed by the enterprise affect the audit plan.

a) Accounting policies
b) Audit policies
c) Accounting and Audit policies
d) Management policies
39, ______ contains information pertaining to financial history, memorandum of

association, articles of association of a company.
a) Permanent audit file
b) Current audit file
c) Test audit file
d) Permanent and Current file
40. ________ is the cash purchase related voucher.

a) Cash bill
b) Cash memo
c) Goods inward book
d) Cashbill , Cash memo and Goods inward book
41. The auditor has a right to----------

_________.
a) Take legal & technical advice
b) Sign the audit report
c) Receive remuneration
d) Legal, Technical and Receive remuneration
42. Essentials of good audit report includes--------- _______.

a) Simplicity
b) Clarity
c) Firmness
d) All of the above
43. ______ is a type of voucher.
a) Template voucher
b) Adjustment voucher
c) Reversal voucher
d) All of the above
44. Misstatements can arise from ______.

a) Error
b) Fraud
c) Both (a) and (b)
d) None of the above
45. Vouching is done ______.
a) End of the year

b) Throughout the year
c) Beginning of the year
46. ______ contains information pertaining to financial history, memorandum of

association, articles of association of a company.
a) Permanent audit file
b) Current audit file
c) Test audit file
47. A reason to establish internal control is to_____________
a. Have a basis for planning the audit

b. Encourage compliance , reliability and timeless of information
c. Ensure the accuracy, reliability and timeless of information

d. Provide reasonable assurance that the objectives of the organizations
are achieved.
48. The following is a component of Internal control
a. Legal environment
b. Organisational structure
c. Control Environment
d. Risk assessment process
49. In an audit of financial statements, an auditor’s primary consideration

regarding a control is whether it
a. Affects managements financial statement assertions

b. Enhance Management’ decision making processes
c. Provide adequate safeguards over access to assets
d. Reflect management’s philosophy and operating cycle
50. Internal controls are grouped into the following categories:
a. Efficient operations, financial analysis, and management reporting

a. Effective operations, financial reporting, and compliance.
b. Efficient operations, financial analysis, and compliance.
c. Production and operations, financial reporting, and
management reporting.
51. The purpose of audit and investigation is

a) Same
b) Different
c) Sometimes same and sometimes different
d) Truthfulness and fact
(8)
52. The objective of tax audit is to assist the ------ in making the correct income tax
assessment of the assessee concerned
53. Balance sheet audit is also known as_-------------_______
54. Which type of audit is conducted by the Internal audit staff___---------

55. Which of the following is an importance of vouching?
56. Checking the head of account debited or credited during vouching helps the auditor to
57. Process of checking the evidence of the entries called _____________.
58. Serial number of vouchers should be ____________.

59. Voucher should be addressed to the ____________.
60. Vouching helps the auditors to ascertain whether the entries in the
book________________ , this is the basic objective of auditing.
61. Which of the following documents is not relevant for vouching cash sales?
62. To test whether sales have been recorded, the auditor should draw a sample from a file of
63. In order to vouch, which of the expenses, the auditor will examine Bill of Entry?
64. In case of unclaimed wages, the auditor should examine whether-
65. In case of sales return, the auditor should examine which documents?
66. Which of the following is most crucial to a purchase department?
67. The creditors accounts, generally, have credit balance. Debit balance may be due to-
68. Which of the following is not true about verification of assets?
69. Which of the following assets is least likely to be subjected to lien?
70. When counting cash on hand the auditor should ___

71. Inspection report/receiving report supports entries in
72. -------------- of the companies Act 1956 prescribes the duty of preparing a report by an
auditor
73. Which among the following is an example of intangible asset?
74. __________________section of Companies Act deals with share Capital
75. Verification of assets involves a critical examination of --------
76. The balance of petty cash is _______
77. Which of the following payment is made from petty cash____
78. When cash is drawn from bank for business use the entry type will be?
79. Depreciation in spirit is like?
80. Which o f the following is not a primary function of a Bank?
81. KYC means
82. Which type of deposits earns higher interest rate?

a) Current account
b) Savings Account
c) Fixed Deposits
d) Recurring account
83. Maximum tenure of Fixed Deposit is

a) 5 years
b) 7 years
c) 8 years
d) 10 year
84. Which shareholders are returned their capital after some specified time:
(A) Redeemable Preference Shares

(B) Irredeemable Preference Shares
(C) Cumulative Preference Shares
(D) Participating Preference Shares
85. Reserve Capital is a part of -----
(A) Paid-up Capital

(B) Forfeited Share Capital
(C) Assets
(D) Capital to be called up only on liquidation of company
86. The independence of an internal auditor will most likely be assured if he reports to the ----
-----------_______
a) President Finance
b) President System
c) Managing Director
d) CEO
87. For which of the following , Audit is optional
a. Trusts
b. Joint Stock Companies
c. Proprietorship concern
d. Sole trader
88. _Expenses incidental to purchase of fixed assets are_
a . Debited to fixed asset

a. Credited to fixed asset
b. Debited to plant & Machinery
c. Credited to Plant & Machinery
89. Auditor should see that the company concerned is the----------___ __of the concern
a. Register owner
b. Owner
c. Management
d. Employee
90. Auditor Should verify_------------ system while checking all the balance sheet
a. Current assets
b. Fixed Liabilities
c. Current Liabilities
d. Assets
91. Auditor should obtain list of ---- while verifying proposed dividend
a. Shareholders
b. Directors
c. Suppliers
d. Distributors
92. Auditor should confirm that any --------- are not shown as reserves
a. Losses
b. Provisions
c. Depreciation
d. Profit
93. In case of calls in arrears , any calls due from --------- are shown separately in balance
sheet
a. Directors
b. Shareholders
c. Suppliers
d. distributors
94. Realization from Debtor’s should be as per the ----------- of the concern
a. Credit policy
b. Debit policy
c. Purchase policy
d. Sales policy
95. Auditor should ensure that the --------- life of the patent has not yet been expired
a. Legal
b. Illegal
c. Document
d. Proof
96. In case of sale of furniture, auditor should ascertain that the------- on such sale has been
correctly calculated
a. Profit or loss
b. Balance sheet
c. Liabilities
d. Assets.
97.Fictious assets are to be ----------------
a . Written off
b . bad debts
c . Reserve for bad and doubtful debts
d . Profit & loss
98. Sales commission is generally calculated as a ------- of total sales made by ascertain
a. Percentage
b. Commission
c. Factor
d. Discount
99. Salary is vouched based on ---------------
a. Salary register
b. Cash book
c. Logbook
d. Accounts.
100. Auditor should check the position of amount deposited in the bank which were----- at the
close of the year.
a. Outstanding
b. Prepaid
c. Interest
d. Salary
BUSINESS ETHICS AND CORPORATE GOVERNANCE
TY BBI- Semester V- Sample Questions
UNIT I
1. Who propounded Utilitaian Approach?
2.The word Ethics is coined from _____ word’ Ethikos’ which means character.
3.Which ethics affect family, relations, and finances ?
4.__________ ethics are the principles which are introduced to an individual in a
professional Organization.
5.To carry out the transaction, the parties must accept the principles of ________
6._______ is about obeying and adhering to rules and authority.
7.For business________, business ethics is compulsory.
8.Business should not co-operate with any one for doing any______ act.
9.Business Ethics is a _________term
10.________ is any creative work or invention considered to be the property of its creators .
11.In making ethical decisions, it is necessary to perceive and eliminate _______ options
and select the best ethical alternative.
12.Professional ethics means __________________
13.Rules and principles set by management is termed as _______
14. Which type of the Ethics harm others?
15.The meaning of transactional ethics is ______________

16.Which one of the following is not related to professional work?
17.Handling of conflicting situations or problematic situation is an example of ______
18.Which one of the following is not a principle of ‘ Business Ethics? ‘
19. Following Rules and Regulations is an example of __________
20. Window dressing is an example of _____________
21. Issues affecting privacy of employees- Workplace surveillance comes under

____________ethics.
22..’ Black and Gray market’ is a term used in ______Ethics.
23. Ethics in Production is nothing but use of _____________.
Unit II – Application of Ethical Theories in Business
1.For business survival______ ethics is necessary.
2. Holders of ethical dilemmas are called__________
3. _______ _______is a moral situation where a choice has to be made between two equally
undesirable alternatives .
4. Marketing Mix means__________
5.Highlighting the performance of the product more than its actual means__________
6. The Greek word ‘Deon “ means _________.
7. ‘Deontology ‘is a ethical theory proposed by______________ philosopher.
8. Virtue Ethical theories are ___________.
9. Aristotle identifies approximately __________ virtues that enable a person to perform their
human function well.
10.________ is a socio-economic philosophy that was propounded by Mahatma Gandhi..
11. The fundamental concept of Trusteeship is about ________,________.
12. Which one of the following is not a part of ‘Gandhian

approach to management philosophy?
13.Kant’s Theory that we have an obligation to act in a way that we would only concede that
every one else could act as well.
14. Who said “ We should behave with others as we wish others to behave with us ?”
15.An example of an unethical advertisement would be ________
16.GAAP / IFRS comes under ethical issues in _________.
17.Which one of the following belongs to Ethical Issues in Business ..
Unit III- Introduction to Corporate Governance
1.Which of the following would most effectively act as the primary objective of a business
organization?
2.Which one of the following does not belong to Ethics relating to Copy Rights..
3.What is the full form of WIPO?.
4.Ethics in Free and Perfect Market means_________.
5.Industrial designs are an example of _____________.
6..International Financial Crisis of 2007-20008 is also known as ____________
7._________ _______ committee belongs to Corporate Governance history of India.
8/.CII was established in the year _________.
9.Disclosure and Transparency is one of the principle of _____________.
10.The full form of CII is _______ _____________ _______.
11.Which one of the following is termed as unethical practice in marketing.
12... Which one of the following does not belong to ‘Ethics in Marketing ?’
13.._________ is the system by which companies are directed and controlled .
14..Short term profit at the cost of losing a customer is long term death for the ______.
15.Which one of the following does not belong to the theories of Corporate Governance ?
16. Which of the following is NOT an example of a genuine business innovation?
17.What is meant by ‘Separation of ownership and control?’

Unit IV – Genesis and Implementation of Corporate Governance in India
1.The _____ is the Title of a handbook for running an empire written by Kautilya.
2.The title ‘Arthashatra ‘is a ________which is normally translated as the ‘Science of Material
Gain’.
3.._________philosophy is based on the principles of “Sam, Dam, Dand, Bhed”
4. Principles of _________Niti are still practiced by some top corporate houses.
5. ‘The end justifies the means ‘ this is supposed to be the basis of __________Machiavellian
philosophy.
6.’_____________’ or ‘the welfare of the people was the ultimate goal of any ruler or
government.
7. CII code for desirable Corporate Governance developed by a Committee chaired by_______.
8.SEBI to constitute a Committee under the chairmanship of ________to suggest changes in the
Listing Agreements.
9.. ‘The Agency gap ‘in western economies represents the gap between the ______of
Management and dispersed shareholders.
10. Board meetings shall be held at least __________times a year , with a maximum gap of
__________months between any two meetings.
11.The Chairman of the audit committee will be an _______director.
12.The Company’s Act , 2013, requires an independent Director to review the performance of
the ___________Directors
13. ___________which is an Apex Body for the development of Accountancy in India.
14. _______is preached in the battle of Kurukshetra by Lord Krishna.
15. ____________issues are concerned with performance of the Management.
16. As per the revised clause 9, the company through the Bard of Directors shall constitute a
___________ committee.
17. The new CSR regime is based on _____________ approach to stringently push big corporate
giants to take initiative towards their duty to contribute towards their CSR activities .
Unit V – Global Scenario- Business Ethics in Global Economy
1.Government of India has introduced the negotiable Instruments Act1881, which provides for
provisions to deal with cases of _________under section 138 to 142.
2._________ is defined as any behavior by which a person intended to gain a dishonest

advantage over another.
3.________exploits a system in which , when a cheque is deposited to a bank account , the

money is made available immediately even though it is not removed from the account on which
the Cheque is drawn until the Cheque actually clears.
4.Surrender is a voluntary terminating the ___________ policy by the insured before maturity or
the insured event occurs .
5.Cut the Red Tape’- is one of the measures to overcome __________.
6._______was facilitated by UNGC. It was introduced in 2018 to employees with a procurement

or sales role.
7.To ensure best practice , organizations need both to measure their ______________
performance and to foster open______.
8..___________ is a confident trick or confident game , which is an attempt to intentionally

mislead a person or persons usually with the goal of financial or other gain.
9.____________ is a widely publicized allegation or set of allegations that damage ( or tries to

damage ) the reputation of an Institution ., individual or creed .
10.During __________ the politicians try to lure the people by offering money and other things.
11.Due to corruption India is unable to eradicate _______.
12.Business is extremely a wide term in the business world at _______ as well as ______ level.
13.Ethics are important not only in business but in all aspects of life because it is an essential
part of the foundation on which a _______society is build
14.__________ business is the oldest and most common mode of economic organization.
15.Punishing corruption is a vital component of any effective ____________ effort.
16.To make concept of Zero Tolerance of Corruption meaningful it was decided to convert it
17.India has no _______ detective agency which can investigate with full power and freedom to
expose the corrupt individuals.
______________________________________________________________________________
Q2. Answer the following questions : ( Each question carries 2 mark)
1. Professional ethics means __________________
2.Ethics in compliance means___________, __________ , ___________.
3. Marketing Mix means__________
4.Which one of the following is not a key tenet of a Trusteeship?
5.What is the full form of WIPO?.
6.According to clause 49 on Independent Directors . What should be minimum age of

Independent Director?
7.Match the following
A Group B Group
A. CII i.20007-8
B. International Financial Crisis ii.2009
C. Disclosure and Transparency iii. OEDC
D. Unethical Practice iv. Misinterpretation
7.Board meetings shall be held at least __________times a year , with a maximum gap of
__________months between any two meetings.
8.Challenges frequently encountered by family business involves :
9. Mandatory recommendations of Kumar Mangalam Committeee.
10. What is the meaning of Fraud?
______________________________________________________________________
Shri Bhausaheb Vartak College of Arts ,Commerce and Science, Borivali (west)
Program: - TYBBI Sem: -V Course: - Business ethic and corporate governance
Sr. No Question A B C D Answer

The word ethics is derived from Greek word _____which
Ethos Ehiopia Ethico Ethonia
1 means custom, usage or habit. A
What is right or wrong is consistent in all places or
Subjectivism Relativism Absolutism Feminism
2 circumstances is called ethical _____ C
It is the basic fundamental for gender and democratic Contemporary
Transactional ethics Cognitive ethics Virtue ethics
3 equality issues. ethics A
Contemporary
Participatory ethics Cognitive ethic Virtue ethics
4 It is the ethics of individual and collective citizenship. ethics A
Normative
Pure science Inexact science Exact science
5 Ethics is a______. science B
___in an organisation and shows that compliance with law is
Ethical climate Moral climate Information system Control system
6 fuelled by a desire to abide by the laws. A
_____have a responsibility in ensuring that corporations act
Government Public Customers Creditors
7 according to the rules and norms of the society. A
the form of ethic that endeavours to help professional
Organisational
decide what to do when they are confronted with a case or Personal ethics Professional ethics Business ethics
ethics
8 situation that raises an ethical question or moral problem is C
9 __ is very particular and exclusive right even for Competitive market Foreign trade Copyright Marketing C
Most companies begin the process of establishing
Code of conduct Law Finance HRM
10 organisational ethics program by developing___. A
According to_____culture dependent approach to the Contemporary
Moral ethics Cognitive ethics Virtue ethics
11 concept of morality. ethics A
__ is an ethical system that determines morality on basis of
Ethical alturism Ethical egoism Utilitarianism Absolutism
12 the greatest good for the greatest number. C
__ emphasize the role of one character and the virtue that Contemporary
Contextual ethics Cognitive ethics Virtue ethics
13 one's character emobodies for determining or evaluating ethics D
____ is the normative ethical position that moral agent
Ethical alturism Ethical egoism Utilitarianism Absolutism
14 ought to do what is in their own self interest. B
___ is analytical , critical thinking about the presupposition
Contemporary ethics Cognitive ethics Virtue ethics Metaethic
15 of normative ethics. D

Compliance , Complications,Cont
Compliance, Caring,
Contribution, ribution, Compliance , Comfort , Consequences
Confidentiality
16 Three C's of business ethic are ___. Consequences Consequences A
Utilitarian approach Virtue approach Fairness approach Common good approach

17 __ follows the ethics for welfare of everyone in the society. D
___ is advertising where one party advertise his goods or Comparative
Promtional advertising Bandwagon advertising Patriotic advertising
18 services by comparing them with the goods and services of advertising B
Harm principle Fairness principle Autonomy principle Human rights principle

19 Respecting human right is known as D
20 The word governance comes from____ root gubernare to Latin Italian Indian American A
Which one of the following is enterprise economic effect on Employee
Emission Education & cullture Wealth generation
21 society volunteers D
Which one of the following is enterprise social impact Sustainable
Emission Education & cullture Wealth generation
22 effect on society development C
Which one of the following is enterprise environmental
Emission Human right Education & cullture Wealth generation
23 impact effect on society A
__ determines to substantial extent , how a coporation is Structure of Institutional
Ownership structure Financial structure
24 managed and control. company board environment A
25 ___ where the foreign parent is the dominant shareholders. PSU MNC Domestic business Local business B
The framework for establishing good corporate governance Thornton
Nestle committee Rowntree committee Cadbury committee
26 and accountability was originally set up by the committee D
___ is defined as any group or indiviual who can affect or is Shareholders
Stakeholder theory Stewardship theory Agency theory
27 affected by the achievement of the organisation objective. theory A
This theory is an alternative view of agency theory in which Shareholders
28 manager are assumed to act in their own self interest at the theory C
29 ___ are the true propreitors of a company. Shareholder Director CEO Employee A
Shareholders
30 ___ is introduced by edward freeman in 1986. theory A
31 .___are general standards and may be regarded as order Values Intrinsic Freedom Culture A
32 .___is the sacred book of Christianity a collection of ancient Bible Quran Bhagwat Geeta Jerusalem A

33 Quran is regarded widely as the finest piece of literature Hindi Spanish Arabic English C
34 The Quran is the religious text of___. Bible Islam Arabic Hindu B
35 The __ is the title of a handbook for running an empire, Arthashastra Sanskrit Kautilya Yogkshema A
___ means maintenance in the business context to
Raksha Vriddhi Palana Yogkshema
36 compliance of the law in letter and spirit. C
Primary responsibility for preventing fraud in an
Audit committee Board committee Remuneration committee Nominating committee
37 organisation is on A
Which of the following committee approves management Government
Board committee Remuneration committee Nominating committee
38 strategic plans? committee A
___constituted a meeting on January 2000 based on
CI I RBI OECD S EBI
39 recommendation of Kumar mangalam Birla committee on D
40 The primary stakeholders are Debtors Creditors Shareholders Banks C
Shareholder
Shareholder activist Audit committee Incometax department
41 an example of an internal governance mechanism is proposal C
42 There are _____areas of global compact. Three Two Four Ten C
43 The first global compact leaders summit was on___. June 24, 2004 June 27, 2007 June 20, 2000 June 24, 2004 A
Kumar mangalam
Cadbury committee Narayan murthy Hampel committee
44 Who presented report on corporate governance in 1998 birla D
___ is practised by public servant who may be basically
Episodic corruption Petty corruption Grand corruption Systemic corruption
45 decent and honest individual but are grossly underpaid. B
Banks have to report frauds electronically in a specific Central Bank of
Central fraud registry Central bureau of information RBI
46 format to India A
In Indian financial system the SEBI regulate and monitors
Clause 410 Clause 49 Clause 48 Clause 41
47 the corporate governance of listed companies in India A
The ____Must monitor a company financial reporting Board
of Remuneration
Audit Committee CEO
48 process and financial in information. directors committee A
___ of the company are required to certify that no fradulent
Internal auditor Statutory auditor CEO Audit committee
49 and deceptive transactions are carried out by the company. B
Clause 49 has laid down more stringent qualification criteria
Clause 410 Clause 49 Clause 48 Clause 41
50 for those who are independent director___. B
Business Ethics
and
Corporate Governance
(As per the New Syllabus 2018-19 of Mumbai University for BBI, Semester V)
Nidhi Chandorkar Tushar Agarwal

NET, MBA (HRM), SET, Ph.D. Scholar, MBA (Marketing),
HOD – Department of Management Studies, MBA (Corporate Governance),
S.M. Shetty College of Science, Commerce M.Com. (Management),
and Management Studies, Powai. BMS Coordinator,
Chandrabhan Sharma College of Arts,
Science and Commerce, Powai.
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PREFACE
Success of any business, in today’s time, is judged not only by its revenue but also by its social
contribution and environmental friendly strategies. Hence, the benchmarking of success is done on the
basis of triple bottom line – Profit, Planet and People. Therefore, knowledge and importance of Ethics
and Governance is essential for all the budding managers, bankers, etc.
This book is based on the syllabus prescribed by the University of Mumbai, which has been
designed to educate the final year students of Banking and Insurance domain of commerce about
ethics, governance and corporate social responsibilities. The book deals with concepts as well as its
mechanism of application in Indian context.
The first chapter helps in developing an understanding towards the conceptual part of ethics in
general and business ethics in specific. It also covers an overview of different functional areas under
the scope of business ethics like marketing, foreign trade, copyright, etc.
The second chapter helps in developing decision-making skill and entails about various
approaches to reduce ethical dilemma. These mechanisms are based on the theories developed by
philosophers like Immanuel Kant, Aristotle, Jeremy Bentham, etc. Mahatma Gandhi suggested
trusteeship principle as approach towards managing business. The application of this principle, and in
general, the Gandhian approach for managing modern businesses has also been discussed in detail.
The chapter also covers the functional areas like advertising and finance in light of the unethical
practices and approaches to eliminate or minimize them.
The third chapter is dedicated to the concept of Corporate Governance. It discusses about the
importance and principles of corporate governance and focusses mainly on the Indian Corporate
Governance System. The mechanism of Corporate Governance in India comprises The Companies Act,
2013, SEBI and Clause 49 of listing agreement. The unit also helps in viewing various perspectives of
Corporate Governance by studying the theories.
The ancient Indian approach towards governance was based on the teachings of the scriptures like
Arthashastra and religious scriptures like Geeta, Quran and Bible. The fourth chapter also deals with
the modern evolution of corporate governance in India.
Finally, the global perspective of Business Ethics is discussed. With the evolution of businesses,
variety of scams and frauds have also taken place. The knowledge of these scams will help us
developing a strong and ethical business set-up for long-term benefit of all the stakeholders.
Authors
SYLLABUS
Modules at a Glance
Unit Modules No. of
Lectures
1 Introduction to Business Ethics 10
2 Application of Ethical Theories in Business 10
3 Introduction to Corporate Governance 15
4 Genesis and Implementation of Corporate Governance in India 15
5 Global Scenario 10
Total 60
Sr.
Modules/Units
No.
1 Introduction to Business Ethics
Definition, Meaning, Nature of Ethics, Meaning of Moral and Ethics.
Types of Ethics, Importance of Ethics, Business Ethics – Meaning and Nature.
Importance of Ethics in Business, Areas of Business Ethics, Meaning of Functional Ethics, Types
of Ethics According to Functions of Business – Marketing Ethics, Foreign Trade Ethics and
Ethics Relating to Copyright.
Ethics relating to Free and Perfect Competitive Market.
2 Application of Ethical Theories in Business
Ethical Decision Making: Decision Making (Normal Dilemmas and Problems):
(I) Utilitarianism (J. Bentham and J.S. Mill), (II) Deontology (I. Kant) Virtue Ethics
(Aristotle). Gandhain Approach in Management and Trusteeship, Importance and Relevance of
Trusteeship Principle in Modern Business. Ethical Issues in Functional Areas of Business.
Ethics in Advertising (Truth in Advertising). Ethical Issues in Finance.
3 Introduction to Corporate Governance
Definition and Conceptual Framework of Corporate Governance, Business Ethics – an important
dimension to Corporate Governance, Fair and Unfair Business Practices. Theoretical Basis of
Corporate Governance, Mechanism- Corporate Governance Systems, Indian Model of
Governance, Good Corporate Governance, Obligations towards Society and Stakeholders.
Theories Underlying Corporate Governance (Stakeholder’s Theory and Stewardship theory,
Agency Theory, Separation of Ownership and Control, Corporate Governance Mechanism:
Process, Indian Model, OECD, and Emphasis on Corporate Governance (Transparency
Accountability and Empowerment).
4 Genesis and Implementation of Corporate Governance in India
Introduction principles – Arthashastra and Good Governance in ancient India, Protection of
Interest of Customers and Investors, Historical Perspective of Corporate Governance and Issues
in Corporate Governance.
Values: Meaning, Types, Teaching from Scriptures like Gita, Quran and Bible, Value Systems in
Business.
Implementation of Corporate Governance
Role of Board of Directors and Board Structure, Role of the Non-executive Director, Role of
Auditors, SEBI Growth of Corporate Governance. Role of Government, Corporate Governance
in India. Accounting Standards and Accounting Disclosures. Finance Reporting and Corporate
Governance, Non-accounting Regulations in Corporate Governance, Corporate Governance and
CSR, Family Owned Business - Background, Family Businesses in India, Need for
Professionalization and Transparency in Family Business.
5 Global Scenario
Business Ethics in Global Economy
Ethics in the Context of Global Economy, Relationship between Business.
Ethics and Business Development, Role of Business Ethics in Building a Civilized Society.
Corporate Governance and Issues Related to Scams.
Corruption: Meaning, Causes and Effects.
Frauds and Scams in Banks, Insurance Companies, Financial Institutions, Measures to Overcome
Fraud and Corruption, Zero Tolerance of Corruption.
PAPER PATTERN
Maximum Marks: 75
Questions to be set: 05
Duration: 2 ½ Hrs.
All questions are compulsory carrying 15 Marks each.
Question Particular Marks

No.
Q.1 Objective Questions 15 Marks
Sub-questions to be asked (10) and to be answered (any 08)
Sub-questions to be asked (10) and to be answered (any 07)
(*Multiple Choice/True or False/Match the Columns/Fill in the Blanks)
Q.2 Full Length Question 15 Marks
OR
OR
OR
Q.5 Theory Questions 08 Marks
Theory Questions 07 Marks
OR
Q.5 Short Notes 15 Marks
To be asked (05)
To be answered (03)
Note:
Theory question of 15 Marks may be divided into two sub-questions of 7/8 and 10/5 Marks.
CONTENTS
Chapter 1
Introduction to Business Ethics 1 - 17
Chapter 2
Application of Ethical Theories in Business 18 - 28
Chapter 3
Introduction to Corporate Governance 29 - 61
Chapter 4
Genesis and Implementation of Corporate Governance in India 62 - 87
Chapter 5
Global Scenario Business Ethics in Global Economy 88 - 101
Chapter
1 Introduction to Business Ethics
 Ethics: Definition, Meaning and Nature
 Meaning of Moral & Ethics
 Types of Ethics
 Importance of Ethics
 Business Ethics -Meaning and Nature
 Importance of Ethics in Business
 Areas of Business Ethics
 Meaning of Functional Ethics
 Types of Ethics According to Functions of Business – Marketing Ethics, Foreign

Trade Ethics and Ethics Relating to Copyright
 Ethics relating to Free and Perfect Competitive Market
The concept of “ethics” was introduced by Socrates, and defined as a philosophical discipline by
Aristotle. The word Ethics have been taken from the ancient Greek word ‘ethikos’ which itself is
derived from the Greek word ethos, meaning custom or character. In philosophy,in general, ethical
behavior is that which is “good.” The field of moral philosophy involves developing, defending, and
recommending concepts of right and wrong behavior. These concepts do not change as one’s desires
and motivations. They are not relative to the situation.
Hence, Ethics can be said to be the basic concepts and fundamental principles of decent human
conduct. It is a philosophy which includes study of universal values such as the essential equality of
gender, human or natural rights, obedience to the law of land, concern for health and safety and,
increasingly, also for the natural environment.
2  Business Ethics and Corporate Governance
ETHICS: DEFINITION, MEANING AND NATURE
Definition and Meaning

Ethics can be said to be ‘the field of study that is concerned with values, standards, morals,
principles etc., which are used to base ones decisions or actions. It is a discipline tries to set up criteria
for “good” and “bad” behavior/actions, and to evaluate the motives for these actions, and the
consequences.
Ethics is a branch of philosophy that involves systematizing, defending, and recommending
concepts of right and wrong conduct. Ethics seeks to resolve questions of human morality by defining
concepts such as good and evil, right and wrong, virtue and vice, justice and crime.
Ethics deals with fundamental issues of practical decision making, and its major concerns include
the nature of ultimate value and the standards by which human actions can be judged right or wrong.
Nature of Ethics
Ethics is a study of human behaviour in different external situations. Humans by default has a
capability of judging good and bad, right and wrong behaviour based on the situation. Therefore ethics,
though a relative and subjective term has some common features:
(i) Based on Moral and Social Values: Ethics has its roots in the individual values called as
moral values and collective values also called as social values. As any system or
organisation is a sub set of society and ethics are associated with human behaviour it cannot
violate or contradict social and moral values.
(ii) Ethics as Social Science: Ethics is a study under social science. Though there is an
argument whether ethics is a science or an art. But experts are of the opinion that ethics is
more of science than an art because it is a systematic knowledge about moral behaviour and
conduct of human beings.
(iii) Ethics as Normative Science: The term normative implies a guide or control of action. So,
normative ethics tells us what we ought to do.
(iv) Voluntary: Ethics deals with human conduct that is voluntary and not formed naturally by
any persons or his circumstances. It is created due to system and organisation and is
voluntarily followed by individuals in it.
(v) Externally enforced: Ethics leads to coexistence and smooth functioning of a system,
hence it has to be enforced to a person and is not in-born as morality.
(vi) Basis of Code of Conduct: Ethics of a system, (like organisation, institution or group) helps
in forming its code of conduct which in turn dictates the expected behaviour of the
individuals involved in it.
(vii) Requires Education and Guidance: Ethics is learned behaviour. Individuals need to be
informed, educated, guided and motivated so that they follow the ethical norms with its true
spirit.
Introduction to Business Ethics  3
(viii) Relative Term: As ethics is based on, and for smooth functioning of, the system hence it
has to change in response to environmental conditions. Therefore, ethical values may change
with time and environmental conditions.
Based on above points, we can understand that ethics values may change for a person with
change in his environment or occupation. Therefore, the nature of ethics can be well understood by
dividing it into three categories of features:
A. Personal Ethics
B. Professional Ethics
C. Managerial Ethics
Nature of Personal Ethics

Personal ethics refer to personal or self-created values and codes of conduct of a person. These
ethics are instilled in an individual from the childhood by their parents, friends and family. Examples
of personal ethics can be honesty, openness, commitment, unbiased behaviour and sense of
responsibility. It remains with him all through his life and is reflected by his actions and words. A
person’s personal ethics are also revealed in a professional situation through his behaviour. Personal
values are the conception of what an individual or a group regards as desirable. Personal ethics refers
to the application of these values in everything one does. Personal ethics might also be called morality,
since they reflect general expectations of any person in any society, acting in any capacity. Personal
ethics is a category of philosophy that determines what an individual believes about morality
and right and wrong.
The principles of personal ethics are:
(i) Concerns and respect for the autonomy of others
(ii) Honest and the willingness to comply with the law
(iii) Fairness and the ability not to take undue advantage of others
(iv) Benevolence and preventing harm to any creature
Nature of Professional Ethics

A profession is a vocation or calling, especially one that involves a specific branch of advanced
learning or a branch of science, for example, the profession of a doctor, advocate, professor, scientist
for a business manager.
A professional who is engaged in a specified and is paid for services rendered based on specific
skills. Professional ethics are those values and principles that are introduced to an individual in a
professional organisation. Each professional is expected to strictly follow these principles. This
approach is imperative in professional settings as it brings a sense of discipline in people as well as
helps to maintain office decorum. Professional ethics are those values and principles that are
introduced to an individual in a professional organisation. Each employee is meant to strictly
follow these principles of his profession in the organisation. They do not have a choice.
Also, this approach is imperative in professional settings as it brings a sense of discipline in

people as well as helps to maintain decorum in offices. Some examples may include confidentiality,
fairness, transparency and proficiency.
There are some basic principles professionals are expected to follow in their professional career.
These are the following:
(i) Impartial and objective
(ii) Openness: full disclosure
(iii) Confidentiality: trust
(iv) Due diligence
(v) Duty of care
(vi) Fidelity to professional responsibilities; and
(vii) Avoid potential or apparent conflict of interest.
Nature of Managerial Ethics

A complex workplace can be transformed into a less complicated landscape when thought is
given to establishing some ground rules. Companies that incorporate a set of managerial ethics or
guidelines create a clear path for managers to reference during tough decision-making scenarios.
Managerial ethics is a set of principles and rules dictated by upper management that
defines what is right and what is wrong in an organisation. Managerial ethics is a major factor
affecting how socially responsive an enterprise will be in the long term. The managerial ethics can
lead types of responses given by a manager. Proactive responses are likely to be more ethical since
they will go beyond minimum legal requirements. They are more consistent with the high social
expectations as discussed earlier. Reactive responses either conforms only with the minimum legal
requirements or even attempt to avoid legal requirements through long court cases, lobbying efforts to
avoid responsibility and so forth. The ethics of an enterprise’s managers are a key factor in decision-
making and may be formed by many forces.
MEANING OF MORAL AND ETHICS

Ethics and morals relate to “right” and “wrong” conduct. While they are sometimes used
interchangeably, they are different: ethics refer to rules provided by an external source, e.g., codes of
conduct in workplaces or principles in religions. Morals refer to an individual’s own principles
regarding right and wrong.
Difference Between Ethics and Morality
ETHICS MORALITY
Meaning The rules of conduct recognized in respect Principles or habits with respect to right or
to a particular class of human actions or a wrong conduct. While morals also prescribe
particular group or culture. dos and don'ts, morality is ultimately a
personal compass of right and wrong.
Where do Social system - External Individual – Internal

they come
from?
Why we do it? Because society says it is the right thing to Because we believe in something being right
do. or wrong.
Flexibility Ethics are dependent on others for Usually consistent, although can change if an
definition. They tend to be consistent individual’s beliefs change.
within a certain context, but can vary
between contexts.
Origin Greek word "ethos" meaning"character" Latin word "mos" meaning "custom"
Acceptability Ethics are governed by professional and Morality transcends cultural norms
legal guidelines within a particular time
and place.
TYPES OF ETHICS
Following three major types of ethics as explained below:
(i) Transactional Ethics
(ii) Participatory Ethics
(iii) Recognition Ethics
(i) Transactional Ethics

Man is a social animal. He has to act and react with others through different transactions. The
practices of ethics in all these transactions is called as transactional ethics. In order to let each party’s
transaction run smoothly, all parties have to accept the principle of equality, implying that every agent
should allow every other the same amount of freedom or action he claims for himself. The moral
principle of equality tells us where to refrain from intrusions in the freedom of action of others while
following one’s own affairs, which is negative principle as well as basic.
Example: I need vegetables from vegetable vendor. The vendor wants customer like me for
survival, as we both are dependent on each other, as long as both of us contribute appropriately,
together we generate surplus that none of us on our own are able to produce.
In order to let things run smoothly, again adherence to two specific moral principles is required:
 Principle of honesty
 Principle of reciprocity
The domain of ethics covering transactions that are performed on the basis of simultaneous or
connected interest and that are general by the principles of equality, honesty and reciprocity if
indicated as the domain of transactional ethics.
(ii) Participatory Ethics

Participatory ethics is a privileged part of business ethics. Parties cooperate in order to produce
more distant common good that has three characteristic features:
 The good can only be realised through the participation of all parties.
 Participation cannot be enforced into explicit moral obligation to take part in the project.
 Principle of decency where a real opportunity to contribute to the general welfare presents
itself and no insurmountable obstacle arise, one should have solid moral reasons not to go
for it.
The important thing is that parties in the alliance voluntarily, committing themselves to a self-
imposed and non-enforceable obligation. This entails a specific type of social relations that is guided
by two particular moral principles:
 Principle of decency
 Principle of enunciation
Participatory ethics is about the shape of solidarity in an age of individualisation. It is the ethics
of the civil society, recently rediscovered as a solid ground for collective arrangements where both the
market and the state fail. By participating in a regular basis, in common projects on behalf of general
welfare, a corporation demonstrates that it can take seriously its corporate citizenship.
(iii) Recognition Ethics

As human beings, people are endowed with the ability to understand the problems of others.
This quality leads to the recognition of individuals, institutions and societies. Conflicting situations
can be solved by the correct recognition of the situation.
Example: The employees aged 57-60 years morally obliged to retire to give way to some
younger colleagues, who being in the midst of their careers, can raise a more weighty claim to a job.
The domain of recognition politics covers a large part of traditional ethics interventions. Ethics, in fact,
is about asymmetrical relations about the rights of interest of the one generating a duty for another.
Recognition ethics clarifies and supports this type of discussion applying the two principles
mentioned above and other moral convictions that are considered appropriate.
IMPORTANCE OF ETHICS
Ethics concern an individual’s moral judgements about right and wrong while she/he is in a
system. Decisions taken within an organisation may be made by individuals or groups, but whoever
makes them will be influenced by the culture of the company. Other than providing long term benefits,
ethics are important because:
1. Developing Capability to Judge Right and Wrong: Ethics is a subject that deals with
human beings. Humans by nature are capable of judging between right and wrong, good and
bad behaviour. Since human beings are associated with values and morals, ethics is
important.
2. Develops Trust: Ethics is closely related to trust. Most of the people would agree on the
fact that to develop trust, behaviour must be ethical.
3. Long-Term Survival of Business: Ethics are important not only in business, but also in all
aspects of life. The business of society which lacks ethics is likely to fail sooner or later.
4. Covers all aspects of Life: Ethics are important not only in business but also in all aspects
of life because it is an essential part of the foundation on which a civilised society is build.
5. Guiding Actions: Ethics primarily aim to guide the behaviour and actions of a person or
society or a business through adherence to certain moral principles, standards and values so
that the others are not harmed by one’s unfair, immoral or unjust actions.
6. Aids the Law: Ethics makes for a complementary logic that aids laws in balancing equity,
fairness and justice in those matters of disputes, and actions that touch or affect others.
7. Caters to Wider Issues: The aim of law and ethics may be similar, but ethics will examine
wider social issues involved with an action and may direct the individual or a company to
act differently from what law would do in normal course.
8. Balancing Instrument for Social Justice: Ethical considerations, along with legal
provisions, act as the ‘balancing instrument’ for social justice , which are essential for
sustained growth of a society.
BUSINESS ETHICS – MEANING AND NATURE
Meaning and Definition

Business Ethics is a form of Applied Ethics. It originates from individuals, organizational
statements or from the legal system. It can be said to be the attitude, culture and manner of doing
business by the business community. It is a framework of contemporary organizational standards,
principles, sets of values and norms that govern the actions and behavior of an individual in the
business organization.
According to Andrew Crane, “Business ethics is the study of business situations, activities,
and decisions where issues of right and wrong are addressed.” Business ethics are those principles,
policies or philosophies that are concerned with moral judgment &good conduct as they are applicable
to business situation.
Business Ethics is a branch of ethics which prescribes standards of how the business is to be
carried out. It lays down guidelines for the company’s response and accountability to its various
stakeholders. It gives a deeper understanding of what is good and bad, what is moral and immoral or
what actions are right or wrong in the operations of a business with respect to its customers,
employees, investors, society and all other stakeholders – in order to protect them from harm and
damages to their interests.
Features of Business Ethics

To develop a better understanding for Business Ethics, we should examine the key features:
1. Code of conduct: Business ethics is the code of conduct which businessmen should follow
while conducting their normal business activities.
2. Based on moral and social values: Business ethics is based on well-accepted
moral/principal values. It suggests moral of conduct for businessmen. They include self-
control, service to society and fair treatment to social groups and not to harm/ exploit others.
3. Provides basic framework: Business ethics provides the framework within which business
is to be conducted. It suggests legal, social, moral, economic and cultural limits within
which business has to be operated. It suggests what is good and what is bad in business.
4. Needs willing acceptance for enforcement: Business ethics cannot be enforced by law or
by force. It must be accepted as self-discipline by businessmen. It should come from within
the businessmen.
5. Education and guidance required for introduction: Businessman should be given proper
education, guidance and training in order to motivate them to follow ethical business
practices.
6. Not against profit making: Business Ethics is not against fair profit making. However, it is
against profiteering by cheating and exploiting consumers, employees or investors. It
supports expansion of business activities but by fair means and not through illegal activities
or corrupt practices.
IMPORTANCE OF ETHICS IN BUSINESS

Ethics is important for any business, big or small, for its long term success. Following are the
benefits of ethics for any business:
1. Decision Making: It is our means of deciding a course of action. Without it our actions
would be random and aimless.
2. Standardizing Behaviour of Employees: Business Ethics is about standard of behavior in
workplace, with partners, colleagues, customers etc. Many companies have standard code of
ethics which everyone in the organization has to follow.
3. Greater Customer Satisfaction: Customer will be satisfied only if the business follows all
the business ethics. Business ethics is needed to make business activities fair to consumers.
It checks business malpractices and offers protection to consumers.
4. More Responsible Behaviour: Business ethics is needed in order to make businessmen
conscious as regards their duties and responsibilities towards consumer and other social
group.
5. Improved Confidence of Stakeholders: Business ethics is needed in order to improve the
confidence of consumers as regards quality, price, reliability etc. of goods and services
supplied. It also helps in retaining confidence of stakeholders like financial institutions,

shareholders, buyers, suppliers etc.
6. Protecting Rights: Business ethics is needed for the protection of rights of consumers at the
business level such as right to health & safety, right to be informed, right to choose, right to
be heard etc.
7. Enhanced Corporate Image: Business ethics is needed in order to create good image of
businessmen in the society and also for avoiding public criticism. Ethical business gets
public support while unethical business is criticized by all. Public will be ready to invest or
lend money only if they are convinced that the organization is following fair business
practices.
8. Cordial Relationship and Support: Business ethics is needed in order to develop cordial
and friendly relations between business and society.
9. Long Term Survival and Growth: Organizations doing business ethically will continue to
survive & prosper for the long time. Hence, it is important for the growth & development of
the business in the long term.
10. Uniform Behaviour Across Organisation: Ethics in business are important most of all
because we pass them on to others. We have the ability to show others the correct way to act
and behave by remaining ethical in the way we live.
AREAS OF BUSINESS ETHICS

Ethical problems and phenomena arise across all the functional areas of companies and at all
levels within the company. Hence, the area or scope of business ethics all the functions of a business:
(i) Ethics in Compliance

Compliance is about obeying and adhering to rules and authority. The motivation for being
compliant could be to do the right thing out of the fear of being caught rather than a desire to be
abiding by the law. An ethical climate in an organization ensures that compliance with law is fuelled
by a desire to abide by the laws. Organizations that value high ethics comply with the laws not only in
letter but go beyond what is stipulated or expected of them.
(ii) Ethics in Finance

The ethical issues in finance that companies and employees are confronted with include:
 In accounting – window dressing, misleading financial analysis.
 Related party transactions not at arm’s length.
 Insider trading, securities fraud leading to manipulation of the financial markets.
 Executive compensation
 Bribery, kickbacks, over billing of expenses, facilitation payments.
 Fake reimbursements
(iii) Ethics in Human Resources

Human resource management (HRM) plays a decisive role in introducing and implementing
ethics. Ethics should be a pivotal issue for HR specialists. The ethics of human resource management
(HRM) covers those ethical issues arising around the employer-employee relationship, such as the
rights and duties owed between employer and employee.
The issues of ethics faced by HRM include:
 Discrimination issues i.e. discrimination on the bases of age, gender, race, religion,
disabilities, weight etc.
 Sexual harassment.
 Affirmative Action.
 Issues surrounding the representation of employees and the democratization of the
workplace, tradeization.
 Issues affecting the privacy of the employee: workplace surveillance, drug testing.
 Issues affecting the privacy of the employer: whistle-blowing.
 Issues relating to the fairness of the employment contract and the balance of power between
employer and employee.
 Occupational safety and health.
Companies tend to shift economic risks onto the shoulders of their employees. The boom of
performance-related pay systems and flexible employment contracts are indicators of these newly
established forms of shifting risk.
(iv) Ethics in Marketing

Marketing ethics is the area of applied ethics which deals with the moral principles behind the
operation and regulation of marketing. The ethical issues confronted in this area include:
 Pricing: price fixing, price discrimination, price skimming.
 Anti-competitive practices like manipulation of supply, exclusive dealing arrangements,
tying arrangements etc.
 Misleading advertisements
 Content of advertisements.
 Children and marketing.
 Black markets, grey markets.
(v) Ethics of Production

This area of business ethics deals with the duties of a company to ensure that products and
production processes do not cause harm. Some of the more acute dilemmas in this area arise out of the
fact that there is usually a degree of danger in any product or production process and it is difficult to
define a degree of permissibility, or the degree of permissibility may depend on the changing state of
preventative technologies or changing social perceptions of acceptable risk.
 Defective, addictive and inherently dangerous products.

 Ethical relations between the company and the environment include pollution,
environmental ethics, and carbon emissions trading.
 Ethical problems arising out of new technologies for eg. Genetically modified food.
 Product testing ethics.
The most systematic approach to fostering ethical behaviour is to build corporate cultures that
link ethical standards and business practices.
FUNCTIONAL ETHICS
Marketing Ethics
Marketing ethics is an area of applied ethics which deals with the moral principles behind the
operation and regulation of marketing. Marketing ethics has a potential to benefit society as a whole
and the organisation is long term. It helps in winning customers loyalty. It is beyond the government
regulations enforced on the market or the organisation. Some areas of marketing ethics overlap with
that of media ethics.
Marketing ethics is defined as the basic principles and values that govern the business that is
engaged in promoting products or services to customers.
Principles of Ethical Marketing
1. Truth: All marketing communications share the common parameter that is truth.
2. Personal Ethics: Marketing Professional is bound by the highest standard of personal ethics.
3. Transparency: Marketers should be highly transparent about the people whom they pay to
endorse the products.
4. Fair Treatment: Consumers should be treated fairly based on the nature of the product and
consumer.
5. Privacy: The privacy of the consumer should not be compromised.
Unethical Practices in Marketing
1. Making false, exaggerated, or unverified claims: Some marketers use false statements,
exaggerated benefits, or make unverifiable claims about their offers to attract customers.
2. Distortion of facts to mislead or confuse potential buyers: Sometimes the claims made by
the company are not true or are written in such a way that they confuse the buyers by
concealing reality.
3. Concealing dark sides or side effects of products or services: Most manufacturers
deceive potential buyers that their products have no side effects. Some products may have
side effects immediately evident, but some may have after long time of usage. It’s better to
say, “There are no known side effects” than to say “there are no side effects”.
4. Bad-mouthing rival products: Emphasizing the dark sides of your rival’s products in a bid
to turn potential customers towards the company’s own products is another common but
unethical marketing practice. Rather than resort to this bad strategy, the company should
emphasize on those aspects that make company’s offer stand out from the rest of the pack.
5. Using women as sex symbols for advertising: Presenting women in an undesirable way or
in an indecent way is an unethical way of attracting attention of the audience. This, in long
run, may spoil the reputation of the advertiser.
6. Using fear tactics: The company may create urgency by saying that the offer is for limited
time period. This compels the customers to make on the spot decision, at times without
comparing the product with other brands. Such tactics create undue pressure on the
customers.
7. Plagiarism of marketing messages: Some marketers copy the exact message of the
competitor, which can confuse the customers. It may cause harm to the reputation of the
company as it may appear to be creatively bankrupt.
8. Exploitation: This is charging for much more than the actual value of a product or service.
For marketing efforts to remain with ethical limits; the prices of your offers must be equal to
or less than the value they give the buyer. If the value is less than the cost, it’s unethical.
9. Demeaning references to races, age, sex, or religion: Ethical marketing must be devoid of
all forms of discrimination. If your marketing messages contain lines that place people of
certain age range, sex, religion, nationality, or race at a higher level than others, then you are
crossing the bounds of ethical marketing.
10. Spamming: Spamming is when you send unsolicited emails to potential customers,
encouraging them to buy your products or services. This is the commonest unethical
marketing practice done online. The number of time you send such emails doesn’t matter.
Whether you send them once, or on occasions, or frequently, you remain a spammer.
Ethical Values in Marketing
There are six marketing ethics where the marketers are supposed to follow:
1. Honesty: Be forthright in dealings and offer value and integrity.
2. Responsibility: Accept consequences of marketing practices and serve the needs of
customers of all types, while being good stewards of the environment.
3. Fairness: Balance buyer needs and seller interest fairly, and avoid manipulation in all forms
while protecting the information of the consumers.
4. Respect: Acknowledge basic human dignity of all the people involved through efforts to
communicate, understand and meet needs and appreciate contributions of others.
5. Transparency: Create a spirit of openness in the practice of marketing through
communication, constructive criticism, action, and disclosure.
6. Citizenship: Fulfill all legal, economic, philanthropic and societal responsibilities to all
stakeholders as well as giveback to the community and protect the ecological environment.
Foreign Trade Ethics

Business ethics is an important component of each manager’s education, but managers dealing
with international operations deal with countless ethic problems that are not found in the internal
context. Specific ethic problems that rise in international affairs are due to several factors, amongst
which:
 the diversity of political and law regulation systems;
 the diversity of economical organizing forms and levels of economic development;
 insufficient regulations, especially in less developed countries;
 existing conflicts between national and regional economic interests;
 the influenced area and power of the multinational corporations, as well as their ability to
elude law regulations;
 corruption in some areas of the world.
An organisation may get tempted to unethical practices in the following areas:
1. Employment Practices and Ethics
Ethical issues may be related to employment practices in many nations. The conditions in a host
country may be much inferior to those in a multinational’s home nation. Many may suggest that pay
and work conditions need to be similar across nations, but no one actually cares about the quantum of
this divergence.
2. Human Rights
Basic human rights are still denied in many nations. Freedom of speech, association, assembly,
movement, freedom from political repression, etc. are not universally accepted.
3. Environmental Pollution
When environmental regulation in the host nation is much inferior to those in the home nation,
ethical issues may arise. Many nations have firm regulations regarding the emission of pollutants, the
dumping and use of toxic materials, and so on. Developing nations may not be so strict, and according
to critics, it results in much increased levels of pollution from the operations of multinationals in host
nations.
4. Corruption
Corruption is an issue in every society in history, and it continues to be so even today. Corrupt
government officials are everywhere. International businesses often seem to gain and have gained
financial and business advantages by bribing those officials, which is clearly unethical.
5. Moral Obligations
Some of the modern philosophers argue that the power of MNCs brings with it the social
responsibility to give resources back to the societies. The idea of Social Responsibility arises due to
the philosophy that business people should consider the social consequences of their actions.
Ethics Relating to Copyright

According to Investopedia “Copyright refers to the legal right of the owner of intellectual
property”. In simpler terms, ‘copyright is the right to copy’. This means that the original creator of a
product and anyone he gives authorization to are the only ones with the exclusive right to reproduce
the work. Copyright law gives creators of original material, the exclusive right to further develop them
for a given amount of time, at which point the copyrighted item becomes public domain.
A copyright gives the owner of a work of expression the exclusive right to:
1. Reproduce the work.
2. Distribute copies of the work to the public.
3. Display copies of the work in public.
4. Perform the work in public.
5. Create derivative works based on the original work.
A copyright is collection rights which can be given away, sold, leased, or licensed.
Copyright Infringement
Copyright infringement is the violation, piracy or theft of a copyright holder's exclusive rights
through the unauthorized use of a copyrighted material or work. It includes unauthorized use of a work
or material is any unauthorized reproduction, distribution, performance, public display or transfer to a
derivative work without the copyright owner's permission.
An infringement occurs under all of the following three conditions:
 The owner must hold a valid copyright.
 The alleged infringer must be able to access the copyrighted work.
 Duplication of the copyrighted work must occur beyond exceptions. If an exception does not
apply, permission is requested by the person seeking to use the work.
There are three terminologies associated with copyright infringement:
 Piracy: The term "piracy" has been used to refer to the unauthorized copying, distribution
and selling of works in copyright.
 Theft: It is an instance where a person exercises one of the exclusive rights of the copyright
holder without authorization.
 Freebooting: The term “freebooting” has been used to describe the unauthorized copying of
online media, particularly videos, onto websites such as Facebook, YouTube or Twitter.
Ethics Relating to Free and Perfect Competitive Market

A market is a forum in which people come together to exchange ownership of goods; a place
where goods or services are bought and sold. There are broadly three models of market:
 Perfect competition: A free market in which no buyer or seller has the power to
significantly affect the prices at which goods are being exchanged.
 Pure monopoly: A market in which a single firm is the only seller in the market and which
new sellers are barred from entering.
 Oligopoly: A market shared by a relatively small number of large firms that together can
exercise some influence on prices.
The perfect market has the following key features:
(a) In perfectly competitive market, buyers and sellers are free to enter or leave the market as
they choose. That is, individuals are neither forced into nor prevented from engaging in
certain business, provided they have the expertise and the financial resources required.
(b) In the perfectly competitive free market, all exchanges are fully voluntary. That is,
participants are not forced to buy or sell anything other than what they freely and knowingly
consent to buy or sell. No single seller or buyer will so dominate the market that he is able to
force the others to accept his terms or go without.
(c) In this market, industrial power is decentralized among numerous firms so that prices and
quantities are not dependent on the whim of one or a few businesses. In short, perfectly
competitive free markets embody the negative right of freedom from coercion.
Ethics for A Free and Perfect Market are as Follows:
 Free to Choose the business: Perfectly competitive markets respect the right to freely
choose the business one enters.
 Voluntary Exchange: In perfectly competitive markets, exchanges are voluntary and
respects the right of free choice.
 No Coercion: In perfectly competitive markets, no seller exerts coercion by dictating prices,
quantities, or kinds of goods consumers must buy.
 Maximising Utility by consumer satisfaction: Perfectly competitive markets let
consumers buy the most satisfying bundle of goods, so they distribute goods in way that
maximizes utility.
 Using Resource Efficiently: Perfectly competitive markets encourage firms to use
resources efficiently to keep costs low and profits high.
QUESTIONS
1. Define Ethics. State its basic features.
2. Discuss the features of Personal, Professional and Managerial Ethics.
3. Compare Morals and Ethics.
4. Discuss the three types of ethics and state its principles.
5. Give the meaning of Business Ethics. Discuss its nature.
6. Why is Ethics important in Business?
7. Write a note on Marketing Ethics.
8. State the common unethical practices in Marketing.

9. Write a note on Foreign Trade Ethics.
10. Define Copyright. Discuss Infringement of Copyright.
11. What do you mean by Free and Perfect Competitive Market? Discuss the Ethics of such market.
Fill in the Blanks:

1. Ethics is __________.
(Absolute/Relative)
2. Reciprocity is the principle for __________ Ethics.
(Transactional/Recognition)
3. __________ ethics is about the shape of solidarity in an age of individualisation.
(Recognition/Participatory)
4. Business Ethics is a type of __________ Ethics.
(Meta/Applied)
5. When marketers copy the exact message of the competitor, it is said to be __________ of marketing
messages.
(Plagiarism/Defamation)
Answers:
1. Relative, 2. Transactional, 3. Participatory, 4. Applied, 5. Plagiarism
State Whether the Following Statements are True or False:

1. Ethics cannot change with time and situation.
2. Ethical code of different organisation are always same.
3. Ethics is a normative science.
4. Ethics is enforced externally.
5. Professional Ethics are self-imposed and are not based on profession.
6. Managerial ethics is a set of principles and rules dictated by upper management that defines what is
right and what is wrong in an organisation.
7. Morals are internal and individualistic.
8. Participatory ethics is related to recognising situation and needs of others.
9. Business Ethics and Profit cannot go hand in hand in any organisation.
10. Copyright gives legal rights to the owner of an intellectual property.
Answers:
True: 3, 4, 6, 7, 10
False: 1, 2, 5, 8, 9
Match the Column:

Column A Column B
1. Participatory Ethics (a) to send unsolicited emails
2. Transactional Ethics (b) right of the owner of intellectual property
3. Morality (c) Individual and Internal
4. Spamming (d) Principle of honesty
5. Copyright (e) Principle of decency
Answers:
1. (e), 2. (d), 3. (c), 4. (a), 5. (b)
REFERENCES
1. https://amitiitism.wordpress.com/2015/03/25/business-ethics-nature-and-scope-college-assgn-01/
2. Fernando, A.C. (2012), Business Ethics and Corporate Governance, Pearson Education, Noida.
2. Murthy, C.S.R. (2009), Business Ethics, Himalaya Publishing House, Mumbai.
3. Sherlekar, A.A. and Bhat, K.G. Dr. (2015), Ethics in Management, Himalaya Publishing House,
Mumbai.
4. Mandal, S.K. (2013), Ethics in Business and Corporate Governance, McGraw-Hill Education (India)
Private Limited, New Delhi.
5. http://theydiffer.com/difference-between-personal-and-professional-ethics/
6. http://www.himpub.com/documents/Chapter1539.pdf
7. https://www.diffen.com/difference/Ethics_vs_Morals
8. https://www.profitableventure.com/examples-unethical-marketing-practices
9. https://www.techopedia.com/definition/6638/copyright-infringement

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Financial Services management BBI Sem V

1. There are _____ parties involved in the contract of pledge.

1. The market where dealing in currencies take place is called as ______

List - I (Interviews) List - II (Meaning)

89. The components of a research design are:

a. (ii), (iv) and (vi)

1) The elements of strategic Management are ----

1) The process of collecting scrutinizing and providing information for strategic

6. The primary focus of strategic management is:

1. Sudden change in government, natural calamities, terrorist attacks, industrial disasters

2. Which of these requires combination among many people?

3. Which is not the criteria for strategic audit?

5. Programmes lead to the formulation of _________.

7. Which of these focuses on effectiveness?

8. Which is not the type of organizational control?

10. Financial environment is concerned with ____________

12. Which step of the process model is about consumers?

13. How many different levels of strategy are there?

14. Where does feedback occur?

15. Which level is about business units?

16. _____________ is the process of seeking information about relationship &

1. What is happening to strategy evaluation with the passage of time?

3. Control can be exercised with the help of _________.

4. Evaluation of plan, policies and programmes is done through ________

5. The first step in the Strategic evaluation process is _________

6. Company’s ability to follow a plan is a ____________ factor.

7. The primary external force for a company is ________

1. Choose the correct sequence Decision making process.

3. Choose the correct option regarding the Micro External Environment

5. Choose the correct sequence for strategic choice

6. Choose the correct option regarding vertical integration

7. Choose the correct sequence of strategy implementation

8. Choose the correct option regarding advantages of Matrix Structure

9. Choose the correct sequence of Benchmarking

10. Choose the correct sequence of strategic control

(3) Audit of small enterprise is generally known as ____________

(4) Audit conducted between two annual audits is called as ____________.

(5) ________________ means showing the books of accounts attractive

a. 30 days b. 45 days c. 35 days d. 20 days

(7) _______________ is a book, which is maintained by audit staff

(8) Audit Planning refers to developing an overall plan for ________________.

(9) _________% of total deposits should be covered under concurrent audit

a. Window dressing b. Secret reserve c. confidentiality d.

(13) Statutory Auditor is responsible for ____________

(14) Audit Conducted continuously as transaction takes place is ____________.

(15) The primary objective of Audit is _______________

(16 ) Information about client’s business can be collected from

(17 ) Trial balance is part of_____________ audit file

(18) MOA is the part of _______ audit file

(20) In large organizations it is impossible to check each transaction and it is

22. The main object of an audit is ___

23. A sale of Rs. 50.000 to A was entered as a sale to B. This is an example of _

24. As per AAS-4 if auditor detects an error then______

27. Balance sheet audit includes verification of_

28. Balance sheet does not include-

33. Who is responsible for the appointment of statutory auditor of a limited

35. Auditor should be dutiful like a _______

36. The independent auditor’s primary responsibility is to______________

38. ______ followed by the enterprise affect the audit plan.

39, ______ contains information pertaining to financial history, memorandum of

d) Permanent and Current file

40. ________ is the cash purchase related voucher.

41. The auditor has a right to----------

42. Essentials of good audit report includes--------- _______.

11. The fundamental concept of Trusteeship is about ,.