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BSA 28C > [Topic 1] > Flashcards

[Topic 1] Flashcards

1
Q

The characteristic of being accountable in good governance means the ability to take responsibility for their actions and to answer to someone. In corporate governance, this means to answer to the BOD

A

FALSE

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2
Q

Nicholas Nassim, finance professor, writer and former Wall Street trader coined the term “Black Swan Event” which means events which are impossible to predict due to their extreme rarity yet have catastrophic consequences.

A

FALSE

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3
Q

A white swan event is a highly probable event that is predictable and carries an impact that can easily cascade. The COVID 19 pandemic is NOT a white swan event because it was highly certain to happen.

A

FALSE

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4
Q

Governance is a system by which an organization is directed and controlled.

A

TRUE

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5
Q

Governance exists in order to translate the wishes of the organization’s owners to organizational performance.

A

TRUE

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6
Q

External auditors have the same function as the Internal auditors in that they review the financial statements and improve its integrity.

A

FALSE

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7
Q

The BOD is responsible for the long-term strategic direction of the organization. Management is responsible for the short-term day-to-day implementation of these directions

A

TRUE

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8
Q

Non-executive directors have the same role as other directors, but they have a different perspective.

A

TRUE

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9
Q

The concept of efficiency in Corporate Governance includes the sustainable use of natural resources and the protection of the environment.

A

TRUE

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10
Q

Safeguarding the integrity of the corporation in financial reporting speaks of a corporation’s accountability.

A

FALSE

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11
Q

Management is responsible for establishing the Vision, Mission and Goals of the organization and cascading the same to the different stakeholders of the organization

A

FALSE

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12
Q

Good governance principles are set and mandatory - following strict guidelines and controls in implementation, underpinned by consensus and continually developing notions of good practice

A

FALSE

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13
Q

The audit committee practices its independence through the composition of its members who are non-executive directors and majority shareholders

A

FALSE

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14
Q

The audit committee is directly accountable for top management who are obligated to issue regular monthly reports.

A

FALSE

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15
Q

Governance exists to translate the wishes of an organization’s owners into organizational performance

A

TRUE

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16
Q

There is only one employee hired by the BOD – the CEO.

A

TRUE

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17
Q

In general, an organization or an institution is accountable to those who will be affected by its decisions or actions. Accountability is enforced separately from transparency and rule of law but is equally important

A

FALSE

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18
Q

The promotion of ethical and responsible decision making supports the cost -control principle of corporate governance

A

FALSE

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19
Q

Shareholders are responsible for full disclosure to other stakeholders as to financial and operating
performance.

A

FALSE

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20
Q

Shareholders have a responsibility to provide financial reports and have the primary responsibility for the accuracy and completeness of an organization’s financial statements.

A

FALSE

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21
Q

Good governance is a catalyst of improvement of a firm’s market value in that it has a positive perception that induces potential investors to decide to invest in a company

A

TRUE

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22
Q

The External Auditor is responsible for ensuring the accuracy, timeliness of public reporting of financial and other information for public companies.

A

FALSE

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23
Q

Managing an organization’s risks by establishing Risk Oversight and management and internal control is application of the corporate governance principle of transparency and full disclosure

A

FALSE

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24
Q

Regulators are organizational stakeholders who are concerned with employees’ pension plans to ensure their good financial status upon retirement

A

FALSE

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25
Q

The Internal and External Auditors report directly to the BOD en banc the results of their review of the company.

A

FALSE

26
Q

Governance starts with the shareholders/ owners delegating responsibilities to an elected board of directors to management and, in turn, to operating units with oversight and assistance from internal auditors.

A

TRUE

27
Q

It is important to recognize that management is part of the governance framework; management can influence who sits on the board and the audit committee as well as the othe r governance controls that might be put in place.

A

TRUE

28
Q

Employees have an interest in the quality of corporate governance because it has a relationship to economic performance and quality of financial reporting.

A

TRUE

29
Q

Good governance is a catalyst of improvement of a firm’s market value in that it has a positive perception that induces potential investors to decide to invest in a company.

A

TRUE

30
Q

Regulators are organizational stakeholders who are concerned with employees’ pension plans to ensure their good financial status upon retirement.

A

TRUE

31
Q

Governance exists to translate the wishes of an organization’s owners into organizational performance.

A

TRUE

32
Q

The Audit Committee practices its independence through the composition of its members who are Non -executive directors and majority shareholders

A

FALSE

33
Q

Non-executive directors have the same role as other directors, but they have a different perspective.

A

TRUE

34
Q

External auditors have the same function as the Internal auditors in that they review the financi al statements and improve its integrity.

A

FALSE

35
Q

Employees have an interest in the quality of corporate governance because it has a relationship to economic performance and quality of financial reporting.

A

TRUE

36
Q

Shareholders are responsible for full disclosure to other stakeholders as to financial and operating performance.

A

FALSE

37
Q

The BOD is responsible for the long-term strategic direction of the organization. Management is responsible for the short-term day-to-day implementaion of these directions

A

TRUE

38
Q

The promotion of ethical and responsible decision making supports the cost -control principle of corporate governance

A

FALSE

39
Q

Good governance principles are set and mandatory - following strict guidelines and controls in implementation, underpinned by consensus and continually developing notions of good practice

A

FALSE

40
Q

The audit committee is directly accountable for top managem ent who are obligated to issue regular monthly reports

A

FALSE

41
Q

Shareholders have a responsibility to provide financial reports and have the primary responsibility for the accuracy and completeness of an organization’s financial statements

A

TRUE

42
Q

Safeguarding the integrity of the corporation in financial reporting speaks of a corporation’s accountability

A

FALSE

43
Q

Managing an organization’s risks by establishing Risk Oversight and management and internal control is application of the corporate governance principle of transparency and full disclosure

A

FALSE

44
Q

The External Auditor is responsible for ensuring the accuracy, timeliness of public reporting of financial and other information for public companies

A

FALSE

45
Q

The Internal and External Auditors report directly to the BOD en banc the results of their review of the company

A

FALSE

46
Q

The concept of efficiency in Corporate Governance includes the sustainable use of natural resources and the protection of the environment

A

TRUE

47
Q

In general, an organization or an institution is accountable to those who will be affected by its decisions or actions. Accountability is enforced separately from transparency and rule of law but is equally important.

A

FALSE

48
Q

It is important to recognize that management is part of the governance framework; management can influence who sits on the board and the audit committee as well as the other governance controls that might be put in place.

A

TRUE

49
Q

Governance starts with the shareholders/ owners delegating responsibilities to an elected board of directors to management and, in turn, to operating units with oversight and assistance from internal auditors

A

TRUE

50
Q

Management is responsible for establishing the Vision, Mission and Goals of the organization and cascading the same to the different stakeholders of the organization.

A

FALSE

51
Q

Both Fraud and Error create misstatements in the financial statements that could lead stakeholders to make erroneous decisions

A

TRUE

52
Q

The difference between fraud and error is the intention.

A

TRUE

53
Q

There is an error triangle which aims to explain the occurrence of errors.

A

TRUE

54
Q

The Fraud Triangle elements must all exist, AT THE SAME TIME, for fraud to occur

A

TRUE

55
Q

All fraud is perpetuated by the employees

A

FALSE

56
Q

There is a type of Fraud that is called window dressing

A

TRUE

57
Q

There is a type of fraud that is called lapping

A

TRUE

58
Q

There is a type of fraud that is called kiting.

A

TRUE

59
Q

There is a type of fraud that is called balancing.

A

FALSE

60
Q

There is a type of fraud that is called padding

A

TRUE

BSA 28C (3 decks)

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