About Ethics In Accounting (1a)
Questions and Answers
- 1.
Based on your reading of the ABOUT Ethics in Accounting Reading Material (CA-4, given article 1) respond to the following:Ethics and Integrity Standards are based on the following, EXCEPT:
- A.
Honesty
- B.
Accuracy
- C.
Impartiality
- D.
Objectivity
- E.
There are no clear roles and responsibilities in the group; people just tend to run.
Correct Answer
E. There are no clear roles and responsibilities in the group; people just tend to run.Explanation
In accounting, ethics and integrity standards are based on a broad commitment to honesty, impartiality and objectivity. Ethical standards also require that accountants present information in the clearest and most accurate way possible, with the expectation that the information constitutes an independent report of a business' financial situation.Rate this question:
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- 2.
Based on your reading of the ABOUT Ethics in Accounting Reading Material (given article 2) respond to the following:Select the word and/or phrase that completes the following statement:Integrity is an important fundamental element of the accounting profession. Integrity requires accountants to be _______________________________ with a client's financial information.
- A.
Honest, accurate and forthright
- B.
Accurate, candid and forthright
- C.
Honest, candid and forthright
- D.
Honest, candid and accurate
- E.
Each member of the relay team has a very defined role and set of responsibilities in order to win the race.
Correct Answer
C. Honest, candid and forthrightExplanation
Integrity is an important fundamental element of the accounting profession. Integrity requires accountants to be honest, candid and forthright with a client’s financial information.Rate this question:
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- 3.
Based on your reading of the ABOUT Ethics in Accounting Reading Material (given article 2) respond to the following:Select the word and/or phrase that is NOT part of the statement:Objectivity and independence are important ethical values in the accounting profession. Accountants must remain free ______________________________________________ when conducting accounting services.
- A.
From conflicts of interest
- B.
Disclosing client information
- C.
Questionable business relationships
- D.
All of the above
Correct Answer
D. All of the aboveExplanation
Objectivity and independence are important ethical values in the accounting profession. Accountants must remain free from conflicts of interest and other questionable business relationships when conducting accounting services.Rate this question:
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- 4.
Based on your reading of the ABOUT Ethics in Accounting Reading Material (given article 3) respond to the following:Select the "EFFECTS" discussed in the article:
- A.
Business reputation
- B.
Personal consequences
- C.
Criminal activities
- D.
Usefulness of financial statements
Correct Answer(s)
A. Business reputation
B. Personal consequences
C. Criminal activities
D. Usefulness of financial statementsExplanation
The article discusses the effects of ethics in accounting, including business reputation, personal consequences, criminal activities, and the usefulness of financial statements. Ethics in accounting can impact a company's reputation, as unethical practices can lead to a loss of trust and credibility among stakeholders. Personal consequences can also occur, such as legal or professional repercussions for individuals involved in unethical behavior. Additionally, the article highlights the potential for criminal activities in accounting, such as fraud or embezzlement. Finally, ethics in accounting is important for ensuring the accuracy and reliability of financial statements, which are essential for decision-making and assessing the financial health of a company.Rate this question:
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- 5.
Based on your reading of the ABOUT Ethics in Accounting Reading Material (given article 4) respond to the following:Select the choice that reflects the term(s) and/or phrases that complete the following statement (in sequence):New ________ standards require companies to institute ________ ________ systems and assess those systems annually. Companies also are required to provide full disclosure of _______ _______ _____ ____ items in periodic reports. In section ___, the act clearly states the penalties for unethical accountants, which includes fines and imprisonment.
- A.
Disclosure, internal control, off-balance sheet, 802, disclosure
- B.
Disclosure, internal control, off-balance sheet , 802
- C.
Disclosure, off-balance sheet, 802, internal control
Correct Answer
B. Disclosure, internal control, off-balance sheet , 802Explanation
New disclosure standards require companies to institute internal control systems and assess those systems annually. Companies also are required to provide full disclosure of off-balance sheet items in periodic reports. In section 802, the act clearly states the penalties for unethical accountants, which includes fines and imprisonment.Rate this question:
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- 6.
Based on your reading of the ABOUT Ethics in Accounting Reading Material (given article 5) respond to the following:The IMA notes the following ethical standards in managerial accounting, EXCEPT:
- A.
Credibility
- B.
Competence
- C.
Confidentiality
- D.
Integrity
- E.
Materiality
Correct Answer
E. MaterialityExplanation
The IMA notes the following ethical standards in managerial accounting: competence, confidentiality, integrity and credibilityRate this question:
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- 7.
Based on your reading of the ABOUT Ethics in Accounting Reading Material (given article 6) respond to the following:Select the choice that reflects the term(s) and/or phrases that complete the following statement (in sequence):Ethics refer to the level of honesty you carry into your job. In principle, ethics are _______ and can vary between individuals with opposing views of right and wrong, which is why codes of ethics are created by certain groups to govern themselves. In accounting, there is only one acceptable position -- complete _____ and _____. Never are accountants more tempted to forgo that ultimate ethical duty as when _____ _______ are involved.
- A.
Subjective, trust, honesty, stock accounts
- B.
Objective, trust, honesty, cash accounts
- C.
Subjective, trust, honesty, cash accounts
Correct Answer
C. Subjective, trust, honesty, cash accountsExplanation
Ethics refer to the level of honesty you carry into your job. In principle, ethics are subjective and can vary between individuals with opposing views of right and wrong, which is why codes of ethics are created by certain groups to govern themselves. In accounting, there is only one acceptable position -- complete trust and honesty. Never are accountants more tempted to forgo that ultimate ethical duty as when cash accounts are involved.Rate this question:
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- 8.
Based on your reading of the ABOUT Ethics in Accounting Reading Material (given article 7) respond to the following:Select the entities discussed in the article that "created the 'Generally Accepted Accounting Principles' that define the ethical practices and principles of accounting that businesses use."
- A.
SEC
- B.
GAAP
- C.
FASB
- D.
AICPA
Correct Answer(s)
A. SEC
C. FASBExplanation
The entities discussed in the article that "created the 'Generally Accepted Accounting Principles' that define the ethical practices and principles of accounting that businesses use" are the SEC (Securities and Exchange Commission) and FASB (Financial Accounting Standards Board). The SEC is responsible for overseeing the financial reporting of public companies and has the authority to establish accounting standards. FASB is an independent organization that sets accounting standards for private companies. The AICPA (American Institute of Certified Public Accountants) is not mentioned in the question as being involved in creating GAAP.Rate this question:
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- 9.
Based on your reading of the ABOUT Ethics in Accounting Reading Material (given article 7) respond to the following:The "separation of functions within the department" is an example of an INTERNAL CONTROL.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
The statement is true because the "separation of functions within the department" is a commonly used internal control measure in accounting. This control ensures that different tasks or responsibilities are assigned to different individuals within the department, reducing the risk of errors, fraud, or conflicts of interest. By separating functions, it becomes more difficult for one person to manipulate or misuse accounting information for personal gain. This internal control helps to promote transparency, accuracy, and ethical behavior within the accounting department.Rate this question:
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- 10.
Generally, ethical behavior applies at all times, in any function in business.
- A.
True
- B.
False
Correct Answer
A. TrueExplanation
Ethical behavior is a fundamental principle that should be followed in all aspects of business, regardless of the specific function. It involves conducting business in a fair, honest, and responsible manner, considering the impact on stakeholders, and adhering to moral and legal principles. Whether it is in finance, marketing, operations, or any other function, ethical behavior is crucial for maintaining trust, reputation, and long-term success. Therefore, the statement that ethical behavior applies at all times, in any function in business, is true.Rate this question:
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Mar 17, 2023Quiz Edited by
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Sep 15, 2014Quiz Created by
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