Chapter 1

Question 1

What is the basis of accounting?

Answer 1

Integrity

Question 2

A person with integrity will act out of what instead of expediency?

Answer 2

Moral principle

Question 3

What does integrity mean?

Answer 3

Person acts on principle — a conviction that there is a right way to act when faced with an ethical dilemma.

Question 4

What is key to carrying out the golden rule?

Answer 4

Integrity

Question 5

In western tradition of ethics it is sometimes called what?

Answer 5

Moral philosophy

Question 6

Ethics and morals are sometimes used interchangeably but they are different. What is the difference between the two?

Answer 6

Ethics — refer to rules provided by an external source such as codes of conduct for a group of professionals
• involves the study and application of standards and judgements

Morals — refer to an individuals own principles regarding right and wrong and may be influenced by an religion or societal mores
•employ moral standards/principles against which we compare what we see in order to form a conclusion

Question 7

Ethics consists of

Answer 7

(1) accepted standards for proper behavior
(2) practices a profession follows
(3) laws established and enforced in society
(4) expectations of those live and behave in society

Question 8

Ethics indicates how people should act and it is prescriptive

Answer 8

True

Question 9

What are values?

Answer 9

Basic and fundamental beliefs that guide or motivate attitudes or actions

Question 10

Values is concerned with how a moral person should behave to act in an ethical manner.

T OR F

Answer 10

FALSE

Ethics is concerned with HOW people should behave to act in a ethical manner

Values is concerned with how a person behaves in certain situations and is predicted on a person beliefs that may or may not be ethical

Question 11

Being ethical is the same as following the law

T OR F

Answer 11

FALSE IT IS NOT

Ethical people always try to be law abiding, there may be instances where their sense of ethics tells them to not follow the law

Question 12

Laws create a minimum of standards.

Answer 12

True

Question 13

What is known as the moral point of view?

Answer 13

Is where the decision maker is willing sometimes to take action that may not be in his or her best interest

Question 14

What is ethical relativism?

Answer 14

Is a philosophical view that what is right or wrong and good or bad is not absolute but variable and relative depending on person or social situation

Question 15

What is situation ethics?

Answer 15

Takes normative principles such as virtual, law and Kant’s categorical imperative that relies on actions and generalized them so the agent can make sense of ones experience when confronting ethical dilemma

Question 16

Ethical relativism uses universal moral principles, claiming moral codes are strictly subjective and situational ethics do recognize existence of normative principles but do not question whether it should be applied as directives or used as guidelines instead

T or F

Answer 16

Partial of this statement is FALSE

Ethical relativism DOES NOT USE

Situational ethics DOES QUESTION

Question 17

Hofstede identified 4 cultural dimensions, what are the 4?

Answer 17

1) power distance
2) individualism
3) masculinity
4) uncertainty avoidance

Question 18

What is individualism ?

Answer 18

Focuses on the degree that society reinforces individual or collective achievement and interpersonal relationships

Question 19

In individualistic societies people with high IDV look after who?

In collectivist societies, people with low IDV belong in what?

Answer 19

Themselves and direct family

In groups that take care of them in exchange for loyalty

Question 20

What is uncertainty of avoidance?

Answer 20

Describes the tolerance for uncertainty and ambiguity within society

Question 21

Someone with high UAI, has high or low tolerance for uncertainty and ambiguity?

Answer 21

Low

Question 22

Someone with Low UAI, has high or low tolerance for variet if opinions

Answer 22

High

Question 23

What are virtues?

Answer 23

Are attitudes, dispositions or character traits that enable us to be and to act in ways that develop this potential

Question 24

What are the six pillars of character?

Answer 24

1) trustworthiness
2) respect
3) responsibility
4) fairness
5) caring
6) citizenship

Question 25

Dimensions of trustworthiness include what?

Answer 25

1) honesty • express truth as we know it 2) integrity • essential element in trusting that person • act on principle rather than expediency 3) reliability •promises we make are relied on and must follow through 4) loyalty • requires to keep financial and other info confidential when deals with employer or client

Question 26

Integrity means to act on what?

Answer 26

Principle rather than expediency

Question 27

6 pillars 1. Respect 2. Responsibility 3. Fairness 4. Caring 5. Citizenship 6. Trustworthiness

Answer 27

2) responsibility • accountable for what we do and who we are 3) fairness • treat others equally • can be equated with objectivity 4) caring • caring is empathy ``` 5) citizenship • includes civic virtues and duties that prescribe on how we ought to behave as a part of the community • must obey laws • be informed • volunteer • vote ```

Question 28

What is objectivity?

Answer 28

Means financial and accounting information needs to be presented free from bias that is consistent with the evidence and not based on ones opinion

Question 29

What is empathy?

Answer 29

The ability to understand be sensitive to and care about the feelings of others Caring and empathy support each other and

Question 30

Caring and empathy support each other and allows a person to what?

Answer 30

To our herself in the position of another. This is essential to decision making

Question 31

Can u be civil and not entirely ethical?

Answer 31

Yes Can be well behaved and gracious to others but still be motivated by non ethical values

Question 32

Can you be ethical and not terribly civil?

Answer 32

Treating others badly and disrespect means u have not confirmed to the pillars of character

Question 33

Professionalism and work ethic are important qualities of accounting professionals T OR F

Answer 33

True

Question 34

What are the two important teleological philosophies that typically guide decision making in an individual business decisions?

Answer 34

1) egoism | 2) utilitarianism

Question 35

What is egoism

Answer 35

Defines right or acceptable behavior in terms of its consequences for the individual

Question 36

What do egoists believe?

Answer 36

They believe that they should make decisions that maximize their own self interest

Question 37

What is Enlightened egoism?

Answer 37

Emphasizes more of a direct action to bring about the best interests of a society Allow for well being of others because they help achieve some ultimate goal for decision makers while self interest is still paramount

Question 38

What is utilitarianism?

Answer 38

Follows a relatively straightforward method for deciding the morally correct course of action for any particular situation

Question 39

What are the steps that utilitarians follow?

Answer 39

1) identify various courses of action | 2) determine the consequences of all alternatives and select one that provides greatest benefit

Question 40

What are act utilitarians?

Answer 40

Examine the action itself rather than general rules governing actions to asses whether it will result in greatest utility

Question 41

What are rule utilitarians?

Answer 41

Must choose action that conforms to general rule that would have best consequences

Question 42

What is deontology?

Answer 42

Refers to moral philosophies that focus on rights of individuals and on the intentions associated with a particular behavior rather than on consequences

Question 43

What do deontologsts believe?

Answer 43

Believe moral norms establish the basis for action Based on reasons not outcome

Question 44

What is a right?

Answer 44

Justified claim on others

Question 45

Justice is associated with what?

Answer 45

Rights Fairness Equality

Question 46

Justice and fairness are used interchangeably but there are some differences. What are the differences?

Answer 46

1) justice —> used with reference to standards rightness | 2) fairness —> used with regard to an ability to judge without reference to ones feelings or interests

Question 47

Virtue theorists place emphasis on learning rules and stress less on importance of developing good habits of character? T or F

Answer 47

F | LESS ON RULES AND STRESS MORE ON habits

Question 48

Cardinal values consist of?

Answer 48

1) wisdom 2) courage 3) temperance 4) justice

Question 49

Other important virtues consist of?

Answer 49

1) fortitude 2) generosity 3) self respect 4) good temper 5) sincerity

Question 50

Are CPAS legally held to principles?

Answer 50

No

Question 51

The principles of the AICPA code are based on what?

Answer 51

Values of the profession and traits of character (virtues) that enable CPAs to meet their obligations to the public

Question 52

Principles include?

Answer 52

(1) responsibilities (2) public interest (3) integrity (4) objectivity and independence (5) due care (6) scope and nature of services

Question 53

Objectivity applies to all CPAs or just some CPAs?

Answer 53

ALL CPA

Question 54

Independence applies to some CPA or all CPA?

Answer 54

Applies to only CPA who provide attestation services ( auditing and other assurance services) not tax and advisory services)