WorksheetsQuiziz No 1 Corporate Governance
Total questions: 25
Worksheet time: 16mins
Name
Class
Date
1.
Corporate governance is a process by which the owners, but not the creditors, exert control over the resources of the enterprise.
a)
true
b)
false
2.
The development of strategic plans for a business entity is the responsibility of the board of directors.
a)
true
b)
false
3.
The objective of corporate governance is to enhance long-term shareholder value without compromising the interest of other shareholders.<br />
a)
true
b)
false
4.
A company with good corporate governance has a lower cost of capital and superior stock returns as compared to other companies.
a)
true
b)
false
5.
Corporate Governance starts with shareholders or owners delegating responsibilities directly to operating unit.
a)
true
b)
false
6.
The failure to find the fraud in Worldcom’s financials was on account of
a)
failure of internal control procedures.
b)
auditors’ negligence in audit planning
c)
failure to perform a test of asset additions correctly
d)
failure to attend the increased rental expenditure.
7.
Financial Failures such as Enron, WorldCom are result of
a)
failure in the corporate governance structure
b)
faults in the Public Accounting Profession
c)
greed-infected professionals and management
d)
all of above
8.
A proper system of corporate governance is one that demands
a)
decision making by auditors in place of management.
b)
accountability back through the system to the shareholders.
c)
internal audit representation on the board of directors.
d)
audit planning to obtain competent and sufficient audit evidence.
9.
Corporate governance is a process by which the owners and creditors of an organization
a)
exert control.
b)
require accountability.
c)
exert control and require accountability.
d)
neither exert control nor require accountability.
10.
The responsibility for operating an enterprise is delegated to the
a)
auditor.
b)
audit committee.
c)
management.
d)
board of directors.
11.
The Corporate Governance Code is divided in Board matters and communication with shareholders.
a)
true
b)
false
12.
Management of companies should have the ability to hire and fire the external auditor.
a)
true
b)
false
13.
The audit committee is a subcommittee of the board of directors comprised of independent outside directors.
a)
true
b)
false
14.
Poor corporate governance is co-related to audit risk
a)
true
b)
false
15.
An audit committee must be comprised of outside directors and at least one outside financial expert. Which of the following is considered an outside director?
a)
A director who is not a member of management and has no other relationship to the organization.
b)
A consultant to the organization who works as an honorary member of the board.
c)
A director who is also a member of management and has no other relationship to the company.
d)
A director who is a CPA.
16.
The audit client of the CPA firm is
a)
management.
b)
the SEC.
c)
the audit committee.
d)
the stockholders.
17.
The audit committee has oversight responsibilities for
a)
outside reporting.
b)
internal auditing.
c)
external auditing.
d)
all of the above.
18.
A company with good corporate governance has a lower cost of capital and superior stock returns as compared to other companies.
a)
true
b)
false
19.
Stakeholders' power over businesses stems from their
a)
ability to withdraw or withhold resources.
b)
ability to generate profits.
c)
media impact.
d)
political influence.
e)
stock ownership.
20.
Those who have a claim in some aspect of a firm's products, operations, markets, industry, and outcomes are known as
a)
shareholders.
b)
stockholders
c)
stakeholders
d)
claimholders
e)
special-interest groups
21.
Which of the following industries tends to generate a high level of trust from consumers and stakeholders?
a)
Insurance
b)
Technology
c)
Banks
d)
Mortgage lenders
e)
Financial services
22.
Which of the following do not typically engage in transactions with a company and thus are not essential for its survival?
a)
Employees
b)
Secondary stakeholders
c)
Primary stakeholders
d)
Investors
e)
Customers
23.
A firm that makes use of a _____ recognizes other stakeholders beyond investors, employees, and suppliers, and explicitly acknowledges the two-way dialog that exists between a firm's internal and external environments.
a)
stakeholder model of corporate governance
b)
stakeholder bias
c)
code of ethics
d)
stakeholder interaction model
e)
corporate interface model
24.
The degree to which a firm understands and addresses stakeholder demands can be referred to as
a)
a stakeholder orientation.
b)
a shareholder orientation.
c)
the stakeholder interaction model.
d)
a two-way street.
e)
a continuum
25.
11.A stakeholder group that is absolutely necessary for a firm’s survival is defined as
a)
direct
b)
tertiary
c)
secondary
d)
special-interest.
e)
primary
100 %
