Question 1

Which of the following best pairs an element of the COSO enterprise risk management framework with an example of that element?

Accepted Answer

A) Objective setting, determining which elements of the COSO framework to use 
B) Event identification, identifying needed internal controls 
C) Risk assessment, annual management retreats focused on the ERM plan 
D) Risk response, diversifying risk by expanding internationally

Question 2

Charlie is a partner in a CPA firm. He wants to make some changes to the company's hiring practices, but is concerned current employees will lack the motivation to do so. Which of the following tools should Charlie use to address those problems?

Accepted Answer

A) COSO's enterprise risk management framework and expectancy theory 
B) Expectancy theory and generalized model of business process management 
C) COSO's enterprise risk management framework and generalized model of business process management 
D) Expectancy theory and the steps in the accounting cycle

Question 3

Expectancy theory suggests that three variables contribute to motivation. Consider the questions listed below. For each one, identify the variable that most clearly applies.
A. Can I be assured of a pay raise once I pass the CPA exam?
b. Do I really want this promotion?
c. How badly do I want the approval of my peers and supervisor?
d. How good will I feel if I achieve this goal?
e. If I attend a one-week seminar on fraud examination, will I be able to pass the certification exam?
f. If I get promoted to accounting manager, will I have more flexibility with my working hours?
g. If I read enough books, will I be able to make our inventory purchasing process more efficient?
h. If I study at least three hours per night, will I be able to learn this new accounting software?
i. What is my motivation for learning this new accounting software?
j. Will my chances of getting a better job increase if I get another college degree?

Accepted Answer

The answer of Expectancy theory suggests that three variables contribute...

Question 4

List and discuss three basic principles of business process management.

Accepted Answer

The answer of List and discuss three basic principles of...

Question 5

Consider the following statements as you respond to the next question: i. Based on my research and reading, I'm sure I want to pursue a career in fraud examination.ii. Good grades and leadership skills generally lead to a good job..iii. I am sure I'll pass the CPA exam on my first attempt.iv. I can definitely complete my accounting degree within four years.v. I've spoken to several friends and family members who work for large corporations.Which pair of statements relates to the same variable in expectancy theory?

Accepted Answer

A) I and II 
B) II and III 
C) III and IV 
D) I and V

Question 6

Laurie and Milton were developing a business process management plan for their organization. After deciding to focus on the process of purchasing fixed assets, they should:

Accepted Answer

A) Determine how the fixed asset purchasing process currently works. 
B) Estimate the remaining useful life for each fixed asset in the company. 
C) Look up the definition of "fixed assets" on the FASB web site. 
D) Make the improvements they believe are necessary.

Question 7

Laurie and Milton were developing a business process management plan for their organization. Which of the following actions should they take first, based on the generalized model of BPM discussed in the text?

Accepted Answer

A) Ask co-workers how the purchasing process can be optimized. 
B) Choose an activity to study. 
C) Determine what data their organization has available. 
D) Get a budget from management for developing the BPM plan.

Question 8

Nestor and Maureen are partners in a small consulting firm located in the Republic of Bufflufia; the firm has six employees. For the last five years, the firm has focused on tax planning and tax return preparation. But, Nestor and Maureen are now interested in expanding the firm's scope of services. They are considering risk management consulting, fraud examination and business valuation as potential areas to expand the firm. They are sure at least three of their six employees would put effort into at least one of those three areas, but expanding the firm's services would require additional training for everyone.Part of fraud examination is analyzing an accounting information system and other sources to determine if fraud has occurred. If Nestor and Maureen expand their practice into fraud examination, which of the following statements is most true?

Accepted Answer

A) The COSO enterprise risk management framework may be useful to their new clients. 
B) Expectancy theory may be a useful tool in conducting a fraud examination. 
C) Both A and B are true. 
D) Neither A nor B is true.

Question 9

Leigh is a corporate accounting manager with six employees reporting to her. Most of the employees do good work, but one of them consistently lacks motivation. Which of the following tools should Leigh use to address the problem?

Accepted Answer

A) COSO's enterprise risk management framework 
B) Generalized model of business process management 
C) Basic principles of business process management 
D) Expectancy theory

Question 10

Nestor and Maureen are partners in a small consulting firm located in the Republic of Bufflufia; the firm has six employees. For the last five years, the firm has focused on tax planning and tax return preparation. But, Nestor and Maureen are now interested in expanding the firm's scope of services. They are considering risk management consulting, fraud examination and business valuation as potential areas to expand the firm. They are sure at least three of their six employees would put effort into at least one of those three areas, but expanding the firm's services would require additional training for everyone.Use the COSO enterprise risk management framework to develop a risk management plan for the expansion. Then, use the elements of expectancy theory to suggest ways Nestor and Maureen can motivate their employees to put effort into the expansion.

Accepted Answer

The answer of Nestor and Maureen are partners in a...

Question 11

Brett and Erin are accountants working for XMP Corporation; Brett is very interested in working his way up to being XMP's chief financial officer. He believes if he completes all his assigned tasks well before their established deadlines and controls costs in his area, he will be promoted. He is confident he can achieve those two goals. Which of the following best pairs an element of expectancy theory with a phrase that illustrates it?

Accepted Answer

A) Expectancy: completes all his assigned tasks well before their established deadlines 
B) Instrumentality: very interested in working his way up to being XMP's chief financial officer. 
C) Valence: very interested in working his way up to being XMP's chief financial officer. 
D) Instrumentality: completes all his assigned tasks well before their established deadlines

Question 12

Erin has maintained a very high GPA throughout her accounting education, but wonders if that GPA will ensure that she gets a good job. In terms of expectancy theory, Erin is most concerned about:

Accepted Answer

A) Expectancy 
B) Instrumentality 
C) Valence 
D) Utility

Question 13

Gelton was leading a team of three co-workers focused on improving their company's process for hiring new employees. They had read the company procedures manual describing the current process, then interviewed newly-hired workers about their experiences. They used the principles of activity-based costing to determine the average cost of hiring a new employee, then created a line graph tracing the average cost over the last twelve months. What should Gelton and his team do next?

Accepted Answer

A) Read more books about business process management. 
B) Implement a newer, more efficient hiring process. 
C) Prepare a presentation to the board of directors. 
D) Brainstorm ways the process could be improved.

Question 14

The COSO enterprise risk management framework comprises eight sections, one of which is objective setting. COSO identified five types of objectives most organizations should consider in developing an ERM plan. "Ensuring that the corporation fulfills the requirements of the Sarbanes-Oxley Act" is an example of a ___ objective.

Accepted Answer

A) Strategic 
B) Reporting 
C) Compliance 
D) Risk management

Question 15

One of the steps in the generalized model of business process management discussed in the text focuses on collecting process-related data. If Laurie and Milton are concerned about the risks created by inefficiency in the company's current fixed asset purchasing process, they could collect data related to: (i) the average length of time between an order for a fixed asset and its delivery, (ii) the costs incurred in the fixed asset purchasing process.

Accepted Answer

A) I only 
B) II only 
C) Both I and II 
D) Neither I nor II

Question 16

A method of efficiently aligning an organization with the wants and needs of clients is a definition of:

Accepted Answer

A) Business process management 
B) Enterprise risk management 
C) Internal control 
D) Expectancy theory

Question 17

The basic principles of business process management discussed in the text include all of the following except:

Accepted Answer

A) Always use information technology in BPM projects. 
B) Hire people who can see the "big picture." 
C) Communicate early; communicate often. 
D) Understand how business processes support organizational strategy.

Question 18

Laurie and Milton are concerned about the risks created by inefficiency in the company's current fixed asset purchasing process. They could address their concern by developing: (i) an enterprise risk management plan, (ii) a business process management plan.

Accepted Answer

A) I only 
B) II only 
C) Both I and II 
D) Neither I nor II

Question 19

In a conversation about risk management, Miguel and Rafaela were trying to decide whether to recommend their company invest some cash in short-term securities to increase the cash available for operations. Which element of the COSO framework is most related to their recommendation?

Accepted Answer

A) Internal environment 
B) Monitoring 
C) Risk assessment 
D) Risk response

Question 20

Consider the following statements as you respond to the next question: i. Ask managers to think of one hundred uses for a brick, other than for building things.ii. Assess the educational background and organizational experience of employees.iii. Conduct a one-day seminar on how business processes can create value in the marketplace.iv. Encourage managers to suggest ideas, even if they are impractical.v. Hold weekly meetings to update interested parties on the BPM project; ensure at least one member of top management attends each meeting.vi. Ignore opinions and insights from people not directly involved with a business process.The text discussed seven basic principles of business process management. Which one is not illustrated by any of the six statements?

Accepted Answer

A) Understand how business processes interact with organizational strategy. 
B) Be open to alternatives. 
C) Make sure tasks for external consultants are well defined. 
D) Communicate early, communicate often.

Exam 4: Management Concepts

Which of the following best pairs an element of the COSO enterprise risk management framework with an example of that element?

Charlie is a partner in a CPA firm. He wants to make some changes to the company's hiring practices, but is concerned current employees will lack the motivation to do so. Which of the following tools should Charlie use to address those problems?

List and discuss three basic principles of business process management.

Laurie and Milton were developing a business process management plan for their organization. After deciding to focus on the process of purchasing fixed assets, they should:

Laurie and Milton were developing a business process management plan for their organization. Which of the following actions should they take first, based on the generalized model of BPM discussed in the text?

Leigh is a corporate accounting manager with six employees reporting to her. Most of the employees do good work, but one of them consistently lacks motivation. Which of the following tools should Leigh use to address the problem?

Erin has maintained a very high GPA throughout her accounting education, but wonders if that GPA will ensure that she gets a good job. In terms of expectancy theory, Erin is most concerned about:

A method of efficiently aligning an organization with the wants and needs of clients is a definition of:

The basic principles of business process management discussed in the text include all of the following except:

Laurie and Milton are concerned about the risks created by inefficiency in the company's current fixed asset purchasing process. They could address their concern by developing: (i) an enterprise risk management plan, (ii) a business process management plan.

In a conversation about risk management, Miguel and Rafaela were trying to decide whether to recommend their company invest some cash in short-term securities to increase the cash available for operations. Which element of the COSO framework is most related to their recommendation?