BA4 CIMA Fundamentals of Ethics, Corporate Governance and Business Law exact Exam Questions

Fundamentals of Ethics, Corporate Governance and Business Law

Last Update 5 hours ago Total Questions : 661

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Question # 121

A group of business associates are about to register X Ltd as a company limited by shares. The associates wish to restrict the company ' s objects so that the company is only authorized to carry on the business of retailing computer hardware and software. Which of the following is correct?

The restriction should be stated in the company ' s articles of association

The restriction should be stated in the company ' s memorandum of association

The restriction should be stated in the application to register a company (form IN01)

No restriction is possible as all company ' s now have unlimited objects

Question # 122

Which of the following is INCORRECT in relation to business names?

The business name of a private company limited by shares must end in “Limited” or “Ltd”.

Both public and private companies may use a business name.

If a business name is used, the name of the proprietor must be stated on business correspondence and at the premises where the business is carried on.

If a business name is used which is the same or very similar to that of an existing business, an action in the tort of passing off may be brought by the existing business.

Question # 123

Which of the following is NOT a ' financial stakeholder ' of an organization?

Customer

Employee

Government

Competitor

Question # 124

The majority of developed countries require publicly quoted companies and large companies to produce annual financial statements which are then audited by an external auditor.

Which of the following statements regarding the requirement for external audit is Incorrect?

Independent external audit gives confidence in the financial statements which is required as the directors have incentives to manipulate the financial statements presented to the shareholders

As the directors are responsible for the day-to-day management of the company, they hold more detailed information which is resolved by the presentation of financial statements to the shareholders and this needs to be guaranteed by independent external audit.

Independent external audit gives confidence in the financial statements by including the auditor ' s opinion on whether or not they show a true and fair view.

As the directors are responsible for the day-to-day management of the company, they hold more detailed information which is resolved by the presentation of financial statements to the shareholders and there is a need for this to be assured by independent external audit

Question # 125

Which of the following destroys the original offer and puts another in its place?

A request for further information.

A counter offer.

An acceptance.

A revocation.

Question # 126

Which of the following is correct?

A special resolution may be passed by 51% of the shareholders who are present voting in favor of the proposal either in person or by proxy.

A special resolution may be passed by 75% of the shareholders who are present voting in favor of the proposal either in person or by proxy.

A special resolution may only be passed by 75% of all the company ' s shareholders voting in favor of the proposal either in person or by proxy.

A special resolution may only be passed by all the company ' s shareholders voting in favor of the proposal either in person or by proxy.

Question # 127

Which of the following is incorrect in relation to the criminal law?

All criminal cases commence in the Magistrates ' Court.

The purpose of the criminal law is to regulate behavior within society by punishment and deterrence.

A crime is regarded as an offence against society as a whole and the state will prosecute the offender on its behalf.

A breach of contract is a criminal offence.

Question # 128

Which of the following is correct?

An ordinary resolution may be passed by 50% plus 1 of the shareholders who are present and voting in favor of the proposal either in person or by proxy.

An ordinary resolution may only be passed by 75% of the shareholders who are present voting in favor of the proposal either in person or by proxy.

An ordinary resolution may only be passed by 51% of all the company ' s shareholders voting in favor of the proposal either in person or by proxy.

An ordinary resolution may only be passed by all the company ' s shareholders voting in favor of the proposal either in person or by proxy.

Question # 129

Which of the following terms can be defined as follows?

" ...the way an organization manages its relationships "

Ethics

Social responsibility

Corporate governance

Professional behavior

Question # 130

What is the legal meaning of the word “simple” in the expression “valid simple contract”?

The consideration for the contract is less than £5,000

There are 5 or fewer parties to the contract

The contract has no implied term

The contract does not have to be in any particular form

Question # 131

Which of the following is one of the fundamental principles identified in the CIMA Code of Ethics?

Objectivity

Observation

Obedience

Obsession

Question # 132

J is at his company ' s reception desk when the promotions manager of a new restaurant and bar nearby hands him a number of vouchers for cheap meals and drinks. At the promotion manager ' s request, J agrees to share out the vouchers among his company ' s employees. J does not earn much and is tempted to keep the vouchers for himself and his friends. Is this an ethical issue and why?

Yes - promotional offers of this sort are unethical and J should throw away all of the vouchers

Yes - the vouchers were given to J on the understanding that he would distribute them to other employees rather than keep them for himself

No - as long as J gives vouchers to other company employees who earn as little as he does

No - the vouchers were given to J, so he can do what he likes with them

Question # 133

As a member of the audit team of a large company, J has discovered that one of his close friends is in a part of the business which is going to be sold off, and his friend is likely to face redundancy. What should he do?

Do nothing: professionally, J is bound to respect the confidentiality of the information he has received

Tell his friend: he has an obligation to his friendship

Leak the information: that way he can let his friend know, but the information won ' t be traced back to J

Resign: J can ' t carry on working at the company whilst he is personally compromised