môn F1

In a very large company managing the total level of working capital would probably be the responsibility of the:

• Finance director

• Chief accountant

• Treasurer

• Management accountant

2 Financial accountants usually produce information for the organisation’s external stakeholders. Is this statement TRUE or FALSE?

• True

• False

Internal check is defined as:

(1) ensuring that no single task is executed from start to finish by only one person.  

(2) providing reasonable assurance about the achievement of the organisation’s objectives.

Which of these options is/are correct?

• 1 only

• 2 only

• 2 only

• Neither

3 There is no legal requirement for companies to have a management accounting function. Is this statement TRUE or FALSE?

• True

• False

A is a small owner‐managed company employing 20 staff and having a revenue of 300,000 Euro a year. It decided not to appoint external auditors to review its financial statement. Such a decision:

• is in line with the requirements of current legislations

• will be criticised by governmental authorities

• will allow the company to strengthen its financial controls

Which of the following would be classed as a book of prime entry?

• Bank statement

• Trial balance

• The journal  

• Statement of profit or loss

Gabriella is considering creating a financial accounting department within her business, but is unsure of what such a department would actually do. Which of the following would usually be prepared by a financial accounting department?

• Cost schedules

• Statement of cash flows

• Variance analysis  

• Tax calculations

Angelo decided to record the purchases made on the 2nd of April 200X in tax year ending 31st of March 200X. The authorities will likely classify this as tax ____________. Which of the following words correctly fill this gap?

• evasion

• minimisation

• avoidance

Tax mitigation involves which of the following?

• Taking all legal steps to reduce one’s tax liability

• Agreeing to pay a financial penalty to avoid prosecution

• Moving businesses and funds offshore to reduce liability to UK tax

• Reducing tax liabilities without frustrating the law makers’ intentions

An important advantage of using loans to finance investment is:

• loan interest payments can usually be suspended if profits are low

• the timing of loan payments is often at the company’s discretion

• loan interest is tax deductible

• banks will often not require security for loan advances