Test 2- Kahoot Questions & TXTBK Flashcards
Under the antifraud provisions of the Section 10 (b) of the SEA of 1934, a CPA may be liable if the CPA acted…
Without good faith
A tombstone advertisement
Makes known the availability of a prospectus
A preliminary prospectus permitted under SEC regulations is known as the
Red Herring Prospectus
Which of the following factors, by itself, requires a company to comply with the reporting requirements of the ‘34 SEA?
Shares listed on a national exchange
Which is not an insider of a corporation subject to the ‘34 SEA registration and reporting?
An owner of 5% of the corporation’s outstanding debentures
Which of the following is NOT a purpose of 10B and 10B-5?
To rate securities
Which of the following is excluded from the definition of a security under the Securities Act of 1933?
All are securities under the act: Bond certificate of interest, Debenture, and Any note
Having more than 1 class of stock would automatically subject a company to the reporting requirements of the ‘34 SEA
False
Lin is auditing the fin. S/M of ABC and detects illegal acts. Lin’s duty under Private Securities Litigation Reform Act
Is to inform the audit committee or the board of directors
Under Sarbanes-Oxley Act, who must periodically certify that reports comply fully with relevant securities laws
CEO and CFO
Under the RUPA, a partnership is allowed legally to own property in the partnership name?
True
Under the RUPA partners have joint and several liabilities for breaches of contract of the partnership?
True
Under the RUPA, partners have joint and several liabilities for tort actions against the partnership?
True
A partnership agreement must be in writing if
the partnership can’t be completed in a year
Which statement best describes an advantage of the corporate form of doing business ?
The operation of the business may continue indefinitely
Which of the following is NOT characteristic of the typical limited liability company ?
the company legally has perpetual existence
To which of the following rights is a stockholder of a public corporation entitled?
The right to inspect corporate records
The main difference between Subchapter S and C corporations is
Tax Treatment
Which of the following is true concerning corporations?
Both of the above are true:
-Directors owe a fiduciary duty to the corporation
-Officers owe a fiduciary duty to the corporation
Which of the following is generally included in the corporation’s articles of incorporation?
All of the above:
-Registered Agent
-Number of authorized shares
-Names of incorporators
Which of the following bodies issue permits to practice for CPAs?
The state boards of accountancy
Which of the following is NOT a possible result of an AICPA investigation of a member for an ethics violation?
Revocation of right to prepare tax returns
Which of the following may NOT result in automatic expulsion from the AICPA
Conviction for a felony or a misdemeanor
To which of the following parties may a CPA partnership provide its working papers without either the client’s consent or a lawful subpoena?
The IRS - NO
THE FASB- NO
Which of the following statements is correct with respect to ownership, possession, or access to a CPA firm’s audit working papers?
Working papers are NOT transferable to a purchaser of a CPA practice unless the client consents
Which of the following statements is correct regarding a CPA’s working papers? The working papers must be
Turned over pursuant to a valid federal court subpoena
Which of the following statements concerning an accountant’s disclosure of confidential client data is generally correct?
Disclosure may be made to any party on consent of the client
A CPA is permitted to disclose confidential client information without the consent of the client to
A state CPA society voluntary quality control review board
Thorp, CPA, was engaged to audit Ivor Co’s financial statements. During the audit, Thorp discovered Ivor’s inventory contained stolen goods. …Ivor claimed accountant client privilege to prevent Thorp from testifying. Which of the following statements is correct regarding IVOR’s claim?
Ivor can claim an accountant-client privilege only in states that have enacted a statue creating such a privilege
Under the Securities Act of 1933, which of the following statements most accurately reflects how securities registration affects an investor?
The investor is provided with information on the principal purposes for which the offering’s proceeds will be used
The SEC promulgated Rule 10b-5 under Section 10 (b) of the SEA of 34. Which of the following is (are) purpose(s) of the act?
Yes to:
-encourage disclosure of info relevant to investors
-To deter fraud involving securities
No to:
To rate securities so investors can choose more wisely
The SEC promulgated Rule 10b-5 under Section 10 (b) of the SEA of 34. Under this rule, it is unlawful for any person to use a scheme to defraud another in connection with the
Yes to:
Purchase of any security and Sale of any security
Which of the following situations would require Link to be subject to the reporting provisions of the 1934 Act?
Yes to:
Shares listed on a national securities exchange
No:
More than one class of stock
