Section A Multiple Choice Questions. Choose the best possible answer.

Use the Answer

Booklet provided.

1. Which of these are safeguards for upholding the highest ethical standards?
A. Having written orders to do something.
B. Companies’ internal codes, policies and education.
C. Corporate governance regulations.
D. B and C above.

2. The principle that requires an accountant to protect information learned in the course of
work is called?
A. Competence.
B. Integrity.
C. Confidentiality.
D. Objectivity.

3. Utilitarianism theory suggests that:

A. An action is morally right if it results in the greatest amount of good for the
greatest amount of people affected by the action.
B. An action is morally right if results in the most amount of good possible in the
given situation.
C. One does a significant amount of good.
D. An action is morally right if it results in the least amount of negativity possible.

4. Indicate which ethical theory focuses on the moral character of the decision maker.
A. Distributive Justice.
B. Utilitarianism.
C. Moral Imagination.
D. Virtue Ethics.

5 Professional Accountants who prepare audit reports should as a distinguishing mark

primarily focus their loyalty toward?
A. Management and Directors.
B. Shareholders.
C. Public Interest.
D. Firm Profits.

6. The following would be a key control function of the Board of Directors.

A. Set guidance and boundaries.
B. Appoint CEO.
C. Decide on the company’s auditor.
D. All of the above.

1
Section B

1. Company codes of ethic area source key guidance and operations. It has however been
argued that there are significant conflicts between company and codes and company
targets. Explain any there areas of conflicts. 6 marks

2. Whilst whistleblowing is considered important in reducing and or addressing corruption

and money laundering possibilities it can also be detrimental to the whistleblower. In this
respect measures have to be put in place to ensure confidentiality of information and
welfare of the whistleblower. Discuss any four such measures that should be put in place.
8
marks

3. Many companies have collapsed due to various reasons. One of the key reasons often
advanced is the use of creative accounting. Define creative Accounting. 5 marks

4. Business ethics is considered important and has become a significant contemporary issue.
State 4 reasons why this is the case? 4 marks

5. Differentiate between ethical absolutism and ethical and ethical relativism.

5
marks

6. Executive remuneration has attracted controversy with some executive pay outstripping
shareholder returns. Indicate three ethical problems associated with executive pay.
3 marks
7. Global Financial markets are seen by many as desirable providing for a where financial
products are traded worldwide. There are however ethical issues that have to be
considered. Indicate four such ethical issues. 4 marks.

8. Multinationals face special ethical problems in their cross boarder activities.

Indicate three such special problems. 3 marks

9. Discuss Four (4) key threats to compliance with fundamental principles that accountants
face. 8 marks

End of Paper