Business and Professional Ethics Flashcards

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Key characteristics of sole traders

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Sole traders are individuals who own and run their business, have unlimited liability, and keep all profits.

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Difference between private limited companies and public limited companies

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Private limited companies cannot sell shares to the public and have restrictions on share transfers, while public limited companies can sell shares to the public and have more stringent regulatory requirements.

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Main stakeholders in a business

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Customers, suppliers, finance providers, owners, government, employees, regulatory/professional bodies, and the general public.

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Significance of stakeholders to a business

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Stakeholders have different objectives, requirements, and levels of influence on the business.

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Principle of integrity in professional ethics

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Integrity involves honesty, transparency, and fairness in all professional dealings.

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Professional scepticism

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Assessing information critically, with a questioning mind, and being alert to possible misstatements due to error or fraud.

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Money laundering

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The process of concealing the origins of money obtained through illegal activities, making it appear as though it came from a legitimate source.

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Placement in money laundering

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Introducing illegal funds into the financial system.

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Layering in money laundering

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Moving the funds around to obscure their origins.

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Integration in money laundering

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Reintroducing the funds into the economy as legitimate money.