Question 1

Which of the following occurs when the individual is hesitant to reject a biased proposal from someone else?

Accepted Answer

A)  The halo effect 
B)  Selective perception 
C)  Plausible deniability 
D)  Escalation of commitment 
A)  The halo effect 
B)  Selective perception 
C)  Plausible deniability 
D)  Escalation of commitment C

Question 2

An audit is required to be conducted each fiscal quarter for companies that are publicly traded.

Accepted Answer

A) True 
 B)False  True

Question 3

In a short essay, list and discuss the three primary objectives of financial reporting.

Accepted Answer

a.Make investment, credit, and financial decisions that relate to the firm
b. Help the reader determine the level of cash flow for the firm
c. Identify the economic resources and obligations to the firm, as identified by the Financial Accounting Standards Board

Question 4

______________ is when an individual is selective pertaining to the information given to him or her when a decision needs to be made.

Accepted Answer

A)  The halo effect 
B)  Selective perception 
C)  Plausible deniability 
D)  Escalation of commitment 
A)  The halo effect 
B)  Selective perception 
C)  Plausible deniability 
D)  Escalation of commitment

Question 5

The fundamental flaw of a Ponzi scheme is that it never ends until the person committing the fraud is caught and disappears.

Accepted Answer

A) True 
 B)False

Question 6

_____________ consists of an inspection of the accounting records and other information deemed necessary to express an opinion on the fairness and adequacy of the financial statements.

Accepted Answer

A)  An exploration 
B)  A compilation 
C)  A debate 
D)  An audit 
A)  An exploration 
B)  A compilation 
C)  A debate 
D)  An audit

Question 7

Escalation of commitment occurs when the individual is hesitant to reject a biased proposal from someone else.

Accepted Answer

A) True 
 B)False

Question 8

______________ accounting comes from the concept that management can manipulate the financial results of a company by adding or taking away reserves depending on the circumstances.

Accepted Answer

A)  Hypothetical 
B)  Lease accounting 
C)  Cookie jar 
D)  Virtual 
A)  Hypothetical 
B)  Lease accounting 
C)  Cookie jar 
D)  Virtual

Question 9

Which of the following is NOT one of the three potential conflicts of interest that can take place during the audit process?

Accepted Answer

A)  Auditor-shareholder conflict of interest 
B)  Auditor-firm conflict of interest 
C)  Shareholders-management conflicts of interest 
D)  Self-interests-professional standards 
A)  Auditor-shareholder conflict of interest 
B)  Auditor-firm conflict of interest 
C)  Shareholders-management conflicts of interest 
D)  Self-interests-professional standards

Question 10

In the opening case, HSBC held more than _______ accounts with connections to the United States.

Accepted Answer

A)  400 
B)  4,000 
C)  40,000 
D)  100,000 
A)  400 
B)  4,000 
C)  40,000 
D)  100,000

Question 11

In direct response to the corporate scandals of Enron and WorldCom, the U.S. Congress passed the Sarbanes-Oxley Act in 2002.

Accepted Answer

A) True 
 B)False

Question 12

In a short essay, list and discuss the five individual moderators that affect the individual-level antecedents of fraud.

Accepted Answer

a. Age-as top level managers get older t

Question 13

In direct response to the corporate scandals of Enron and WorldCom, the U.S. Congress passed the _______________.

Accepted Answer

A)  Sarbanes-Oxley Act 
B)  Foreign Corrupt Practices Act 
C)  Robinson Patman Act 
D)  Sherman Antitrust Act 
A)  Sarbanes-Oxley Act 
B)  Foreign Corrupt Practices Act 
C)  Robinson Patman Act 
D)  Sherman Antitrust Act

Question 14

Under the cookie jar system, management will build up financial reserves in profitable years and release the financial reserves into the financial statements during unprofitable years.

Accepted Answer

A) True 
 B)False

Question 15

In 2002, the following firms except one were awarded the Ig Nobel Prize for the development and application of the concept of "imaginary numbers" that are used in creative accounting in the business world, except

Accepted Answer

A)  Enron 
B)  ExxonMobil 
C)  Arthur Andersen 
D)  WorldCom 
A)  Enron 
B)  ExxonMobil 
C)  Arthur Andersen 
D)  WorldCom

Question 16

______________ is geared toward public companies and was established to help increase transparency, integrity, and accountability of public companies.

Accepted Answer

A)  Sarbanes-Oxley Act 
B)  Foreign Corrupt Practices Act 
C)  Robinson Patman Act 
D)  Sherman Antitrust Act 
A)  Sarbanes-Oxley Act 
B)  Foreign Corrupt Practices Act 
C)  Robinson Patman Act 
D)  Sherman Antitrust Act

Question 17

One of these terms is not a form of insider trading, that is, using nonpublic information to make decisions based on an individual's self-interests rather than those of the firm.

Accepted Answer

A)  Traditional theory 
B)  Temporary insiders 
C)  Ponzi schemes 
D)  Tippers and tippees 
A)  Traditional theory 
B)  Temporary insiders 
C)  Ponzi schemes 
D)  Tippers and tippees

Question 18

Which of the following are not Section 404 internal controls ?

Accepted Answer

A)  An internal code of ethics 
B)  Independent board members 
C)  Remuneration committees 
D)  Creation of processes for reporting concerns 
A)  An internal code of ethics 
B)  Independent board members 
C)  Remuneration committees 
D)  Creation of processes for reporting concerns

Question 19

As the level of environmental dynamism increases, the potential for top level managers to commit fraud decreases.

Accepted Answer

A) True 
 B)False

Question 20

A good example of a company that violated the use of off-balance sheet arrangements is ______________.

Accepted Answer

A)  ExxonMobil 
B)  Enron 
C)  Microsoft 
D)  Google 
A)  ExxonMobil 
B)  Enron 
C)  Microsoft 
D)  Google

Which of the following occurs when the individual is hesitant to reject a biased proposal from someone else?

An audit is required to be conducted each fiscal quarter for companies that are publicly traded.

In a short essay, list and discuss the three primary objectives of financial reporting.

______________ is when an individual is selective pertaining to the information given to him or her when a decision needs to be made.

The fundamental flaw of a Ponzi scheme is that it never ends until the person committing the fraud is caught and disappears.

_____________ consists of an inspection of the accounting records and other information deemed necessary to express an opinion on the fairness and adequacy of the financial statements.

Escalation of commitment occurs when the individual is hesitant to reject a biased proposal from someone else.

______________ accounting comes from the concept that management can manipulate the financial results of a company by adding or taking away reserves depending on the circumstances.

Which of the following is NOT one of the three potential conflicts of interest that can take place during the audit process?

In the opening case, HSBC held more than _______ accounts with connections to the United States.

In direct response to the corporate scandals of Enron and WorldCom, the U.S. Congress passed the Sarbanes-Oxley Act in 2002.

In a short essay, list and discuss the five individual moderators that affect the individual-level antecedents of fraud.

In direct response to the corporate scandals of Enron and WorldCom, the U.S. Congress passed the _______________.

Under the cookie jar system, management will build up financial reserves in profitable years and release the financial reserves into the financial statements during unprofitable years.

In 2002, the following firms except one were awarded the Ig Nobel Prize for the development and application of the concept of "imaginary numbers" that are used in creative accounting in the business world, except

______________ is geared toward public companies and was established to help increase transparency, integrity, and accountability of public companies.

One of these terms is not a form of insider trading, that is, using nonpublic information to make decisions based on an individual's self-interests rather than those of the firm.

Which of the following are not Section 404 internal controls ?

As the level of environmental dynamism increases, the potential for top level managers to commit fraud decreases.

A good example of a company that violated the use of off-balance sheet arrangements is ______________.

The Foundation of Ethical Thought

The Evolving Complexities of Business Ethics

Stakeholders and Corporate Social Responsibility

Ethical Leadership and Corporate Governance

Strategic Planning, Corporate Culture, and Corporate Compliance

Decision Making and Human Resource Issues

Ethics and the Environment

Ethics and Information Technology

Ethics and Information Technology

Ethical Issues in the Developing World

Establishing a Code of Ethics and Ethical Guidelines

Evaluating Corporate Ethics

Filters

Exam 4: Ethics and Financial Reporting

Which of the following occurs when the individual is hesitant to reject a biased proposal from someone else?

An audit is required to be conducted each fiscal quarter for companies that are publicly traded.

In a short essay, list and discuss the three primary objectives of financial reporting.

______________ is when an individual is selective pertaining to the information given to him or her when a decision needs to be made.

The fundamental flaw of a Ponzi scheme is that it never ends until the person committing the fraud is caught and disappears.

_____________ consists of an inspection of the accounting records and other information deemed necessary to express an opinion on the fairness and adequacy of the financial statements.

Escalation of commitment occurs when the individual is hesitant to reject a biased proposal from someone else.

______________ accounting comes from the concept that management can manipulate the financial results of a company by adding or taking away reserves depending on the circumstances.

Which of the following is NOT one of the three potential conflicts of interest that can take place during the audit process?

In the opening case, HSBC held more than _______ accounts with connections to the United States.

In direct response to the corporate scandals of Enron and WorldCom, the U.S. Congress passed the Sarbanes-Oxley Act in 2002.

In a short essay, list and discuss the five individual moderators that affect the individual-level antecedents of fraud.

In direct response to the corporate scandals of Enron and WorldCom, the U.S. Congress passed the _______________.

Under the cookie jar system, management will build up financial reserves in profitable years and release the financial reserves into the financial statements during unprofitable years.

In 2002, the following firms except one were awarded the Ig Nobel Prize for the development and application of the concept of "imaginary numbers" that are used in creative accounting in the business world, except

______________ is geared toward public companies and was established to help increase transparency, integrity, and accountability of public companies.

One of these terms is not a form of insider trading, that is, using nonpublic information to make decisions based on an individual's self-interests rather than those of the firm.

Which of the following are not Section 404 internal controls ?

As the level of environmental dynamism increases, the potential for top level managers to commit fraud decreases.

A good example of a company that violated the use of off-balance sheet arrangements is ______________.

The Foundation of Ethical Thought

The Evolving Complexities of Business Ethics

Stakeholders and Corporate Social Responsibility

Ethical Leadership and Corporate Governance

Strategic Planning, Corporate Culture, and Corporate Compliance

Decision Making and Human Resource Issues

Ethics and the Environment

Ethics and Information Technology

Ethics and Information Technology

Ethical Issues in the Developing World

Establishing a Code of Ethics and Ethical Guidelines

Evaluating Corporate Ethics

Filters