Deck 26: Ethics in Accounting

Question 1

It is true that the principle of 'professional behaviour' in the Code of Ethics for Professional Accountants:

A) requires a member to avoid any action or omission that may bring discredit to the profession
B) is, in sense, a catch all provision that covers unethical behaviour not included elsewhere in the code
C) covers accountants' behaviour outside their professional role
D) all of the above

Answer 1

D

Question 2

Of the following statements about the costs and benefits of unethical behaviour is false?

A) The benefits of unethical behaviour are nearly always material
B) The costs of unethical behaviour are nearly always material
C) The penalties for unethical behaviour are not imposed in many cases
D) A cost of unethical behaviour may be the loss of freedom of choice in future decisions about whether to act ethically

Answer 2

B

Question 3

Part of the ethical complaint process for filing with both Australian professional accounting bodies is:

A) filing a written complaint
B) investigating by a telephone call to a senior staff member
C) referring written complaints to the General Manager Professional Conduct (GMPC)
D) all of the above

Answer 3

D

Question 4

Ethical issues pertain primarily to

A) individuals.
B) those in the financial industry.
C) licensed professionals.
D) communities.

Question 5

The ethical issues most frequently experienced by Australian accountants a 2005 survey by Leung and Cooper was:

A) fee problems
B) maintaining confidentiality
C) conflict of interest
D) admitting one's mistakes

Question 6

Where a conflict of interest arises for an accountant so that safeguarding the interest of one client may cause harm to another client,it is generally accepted that rules of professional ethical conduct require that:

A) the accountant should not continue to advise both clients
B) the accountant should ensure that information about either client is not made available by anyone to the other client
C) the accountant should ensure that information about either client is not made available by anyone to the client who might be harmed by the information
D) the accountant should not continue to advise either client

Question 7

Which relationship between accountants and the people with whom they interact is a fundamental motivation for ethical considerations in accounting?

A) professional
B) personal
C) fiduciary
D) proletarian

Question 8

Which of the following is not included as a fundamental principle of professional conduct in the Code of Ethics for Professional Accountants?

A) Confidentiality
B) Accuracy
C) Independence
D) Objectivity

Question 9

Briefly describe the classes of teleological theories that have been used to examine ethical behaviour.

Question 10

The Code of Ethics for Professional Accountants includes all of the following except:

A) Confidentiality
B) Accuracy
C) Independence
D) Objectivity

Question 11

Which of the following is NOT part of the Foundational Ethical Principles that each community derives its own values?

A) honesty
B) justice
C) beneficence
D) respect for persons

Question 12

Which of the following does not fall under the ethical principle of "beneficence"?

A) objectivity
B) professional behaviour
C) confidentiality
D) professional competence and due care

Question 13

The advantage of professions,such as accountants,having self-regulatory codes of ethics is:

A) they are likely to be more lenient than legal rules and regulations enforced by the courts
B) they can forestall action by government regulatory bodies such as the Australian Securities and Investments Commission
C) they are developed and imposed by professionals who understand the problems of practitioners
D) All of the above are advantages

Question 14

Reflecting on the rule of independence in setting ethical accounting standard,discuss the role of 'integrity' and 'objectivity' for auditors.

Question 15

In research on ethical issues faced by accountants in Australia,it was found that the three most common ethical issues faced were:

A) overcharging, professional competence, conflicts of interest
B) confidentiality, honesty, admitting to mistakes
C) conflicts of interest, client proposals to manipulate financial statements and client proposals for tax evasion
D) using inside information for personal gain, client proposals for tax evasion, whistle blowing

Question 16

The Code of Ethics for Professional Accountants is best described as:

A) deontological in nature
B) voluntary for all members of the ICAA, CPA Australia and the NIA
C) descriptive in nature
D) teleological in nature

Question 17

Should accountants act ethically? Explain the reasons for your answer to this question.

Question 18

Self-regulatory codes of ethics for professions,such as accountants means:

A) they are likely to be more lenient than legal rules and regulations enforced by the courts
B) they can forestall action by government regulatory bodies such as the Australian Securities and Investments Commission
C) they are developed and imposed by professionals who understand the problems of practitioners
D) All of the above are advantages

Question 19

Generally accepted that rules of professional ethical conduct require that when a conflict of interest arises for an accountant,if the interest of one client may cause harm to another client:

A) the accountant should not continue to advise both clients
B) the accountant should ensure that information about either client is not made available by anyone to the other client
C) the accountant should ensure that information about either client is not made available by anyone to the client who might be harmed by the information
D) the accountant should not continue to advise either client

Question 20

Which of the following statements about the costs and benefits of unethical behaviour is not true?

A) The benefits of unethical behaviour are nearly always material
B) The costs of unethical behaviour are nearly always material
C) The penalties for unethical behaviour are not imposed in many cases
D) A cost of unethical behaviour may be the loss of freedom of choice in future decisions about whether to act ethically

Question 21

Normative ethical theories are:

A) derived from common law rules of behaviour
B) descriptions of how people actually behave
C) beliefs about how people should behave
D) beliefs about how people actually behave

Question 22

Briefly describe three classes of deontological theories that have been used to examine ethical behaviour.

Question 23

Ethical egoism is based on a belief that people should act in a way that:

A) maximises the 'good' of the person making the decision
B) maximises the 'common good'
C) maximises good to the top stratum of the elite
D) conforms with the rules established by God

Question 24

Ethical parochialism:

A) assumes that ethical behaviour should protect the individuals belonging to the 'in group'
B) suggests that the behaviour of individuals should be constrained by the law and the conventions of fair play
C) is evidenced when individuals seek to maximise their own utility
D) suggests that ethical behaviour should be concerned with the good of all humankind and that individuals are all of equal value

Question 25

Teleological theories of ethics:

A) determine whether behaviour is ethical or unethical by observing the consequences of that behaviour
B) suggest that people behave with varying degrees of self-interest
C) are based on religious principles
D) can be all of the above

Question 26

Deontological theories of ethics:

A) are a special class of teleological theories
B) can also be described as descriptive theories
C) are based on duties and rights
D) can be all of the above