Ethics – Knowsia

BMIS – L1 – SA – Q13.5 – Professional ethics in accounting and business

Identifies what is not a key element of an ethical code.

Question

Which of the following is NOT a key element of an ethical code?

A Adhering to the highest standards of honesty, integrity and fairness

B Seeking or accepting favours which are beneficial to the business

C Avoiding involvement in any decisions that could bring about conflict of interest

D Avoiding any financial interest in contracts awarded by the company

Answer

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Tags: Conflict of Interest, Ethical code, Ethics, Fairness, Integrity
Level: Level 1

Topic: Professional ethics in accounting and business

BMIS – L1 – SA – Q13.4 – Professional ethics in accounting and business

Defines whistleblowing as reporting unethical or improper activities.

Question

Whistleblowing is the reporting by employees of suspected unethical or improper activity by colleagues, managers or other individuals.

A True

B False

Answer

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Tags: Employee reporting, Ethics, Unethical conduct, Whistleblowing
Level: Level 1

Topic: Professional ethics in accounting and business

BMIS – L1 – SA – Q13.3 – Professional ethics in accounting and business

Identifies unethical conduct in presenting misleading financial reports.

Question

The finance director of a large public company, Zenith Corp, presents a financial report to the board of directors, with a view to the company issuing a statement about its financial prospects to the stock market. The director knows that the information in the report is incorrect and materially misleading. The finance director is acting unethically by failing to comply with the principle of:

A professional competence

B integrity

C technical standards

D professional behaviour

Answer

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Tags: Dishonesty, Ethics, Financial Reporting, Integrity, Professional conduct
Level: Level 1

Topic: Professional ethics in accounting and business

BMIS – L1 – SA – Q13.2 – Professional ethics in accounting and business

Defines the principle of objectivity for accountants.

Question

Which of the following fundamental principles of ethical conduct for accountants means that an accountant should be independent, free from bias and from undue influence by other people?

A Confidentiality

B Objectivity

C Integrity

D Professional behaviour

Answer

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Tags: Bias, Ethics, Independence, Objectivity, Professional conduct
Level: Level 1

Topic: Professional ethics in accounting and business

BMIS – L1 – SA – Q13.1 – Professional ethics in accounting and business

Identifies principles expected of professional accountants in their work.

Question

Professional accountants are expected in their work to apply the principles of integrity, objectivity, professional competence and due care, confidentiality and

A transparency and honesty

B technical standards and openness

C honesty and professional behaviour

D professional behaviour and technical standards

Answer

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Tags: Confidentiality, Ethics, Integrity, Objectivity, Professional behaviour, Professional principles
Level: Level 1

Topic: Professional ethics in accounting and business

BMIS – L1 – QD10 – Professional ethics in accounting and business

Describe differences between business and professional codes of ethics for accountants.

Question

(a). Describe the main differences between a business code of ethics and a professional code of ethics for accountants.

(b). List five situations in which an accountant in business might face a moral or ethical dilemma. Provide guidance as to what constitutes appropriate behaviour in each situation.

(c). What is meant by acting in the public interest?

Answer

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Tags: Accountants, Ethics, Professional Responsibility, Public Interest
Level: Level 1

Topic: Professional and Ethical Considerations

BCL – L1 – Q104 – Governance and ethical issues relating to business

Distinguish between code of ethics and conduct for accounting staff; identify stakeholders and corporate responsibilities.

Question

(a) Your company, Apex Solutions Ltd, plans to undertake a rebranding exercise within the next three (3) months, and all Heads of Department are to lead the campaign. You have been asked by management to distinguish between a code of ethics and a code of conduct and explain their relevance to the accounting and audit staff.

(b) Identify any five (5) stakeholders of Apex Solutions Ltd and indicate two corporate responsibilities towards each of the five (5) stakeholders.

Answer

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Tags: Code of Conduct, Code of Ethics, Corporate Governance, Corporate Responsibility, Ethics, Stakeholders
Level: Level 1

Topic: Governance and ethical issues relating to business

SCS – L3 – Q39 – Ethics and social responsibility

Identify ethical principles breached in a scenario involving a takeover and confidentiality request.

Question

(a) You have been recently employed as a Finance Manager of a large manufacturing company. At its first management meeting, the Director of Finance presented information on management’s intention to takeover one of the company’s key suppliers. An old school friend of yours works as an accountant for the targeted company. The Finance Director knows and has asked you to try and find out anything that might help the takeover, but it must remain confidential.

Required:
Identify and explain THREE fundamental ethical principles that could be breached in the above scenario. (b) Corporate social responsibility (CSR) requires that organizations give back to the society by way of investing part of their profits in socio-economic activities of their host communities. Companies adopt different strategies to realizing their CSR obligations to the host communities.

Required:
Identify and explain FOUR strategies for managing Corporate Social Responsibility in organizations.

Answer

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Tags: Conflict of Interest, Corporate Social Responsibility, Ethics, Manufacturing, Professional conduct
Level: Level 3

Topic: Ethics and social responsibility

SCS – L3 – Q30 – Ethical theories

Advise Apea Chemist Ltd on two approaches to managing ethics in organizations.

Question

Apea Chemist Ltd is a company engaged in the manufacturing of various drugs for the local market. There have been series of ethical infractions within the company. Some top managements have been accused of insider trading, bribing of some key staff of the regulatory authorities and attempts to cover up alleged distribution of expired drugs. There is total breakdown of ethical standards within the company. The board of directors have expressed grave concerns about the current happenings in the company. At its last quarterly meeting, the board resolved to engage the services of a corporate governance expert to help address the situation. The board understands that there are two major approaches to managing ethics in an organization.

Required:
As a corporate governance expert, you have been engaged by the board to advise it on TWO approaches to the management of ethics in organizations. (bi)

The International Federation of Accountants (IFAC) Code of Ethics discusses the need for professional accountants to be aware of and avoid conflict of interest situation as well as maintain independence in carrying out their professional duties. The professional accountant is exposed to several threats to independence, which are likely to lead to conflict of interest. A threat may arise where an assurance firm provides services other than assurance services to an assurance client.

Required:
(i) Identify the specific threat a professional accountant or assurance firm faces by providing the following services:

Preparing accounting records and financial statements.
Valuation services.
(ii) Suggest TWO measures each a professional accountant can take to minimize the threats identified in (i).

Answer

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Tags: Conflict Resolution, Ethics, Independence, Professional Accountant, Safeguards
Level: Level 3

Topic: Conflicts of interest and ethical conflict resolution

FR – L2 – Q9 – Professional and Ethical Issues in Financial Reporting

Identify ethical issues in two cases involving financial reporting decisions by ICAG accountants

Question

TWO CASES

Case 1
Kofi Mensah has been on a two-year study sabbatical in Canada and this is his first job on returning to work. Kofi Mensah qualified as an ICAG chartered accountant just before his sabbatical. He worked in a medium-sized practice with wide experience of clients in the mining, manufacturing, and agricultural sectors.
Volta Assurance Limited is a subsidiary of a listed group involved in financial services. The financial controller of Volta Assurance Limited has been on long-term sick leave. Kofi Mensah has been offered an appointment as temporary financial controller three months before the 31 December 20X9 year-end.
Kofi Mensah would be responsible for preparing the financial statements for the year ended 31 December 20X9. Key areas of the financial statements include lessor accounting, financial instruments, and insurance contracts.
During his interview for the post, the group finance director told Kofi Mensah that the group is looking for a strong financial position and performance from the subsidiary and that if Kofi Mensah helps deliver it, he is sure to obtain a permanent post in the group.

Case 2
Kwame Osei is an ICAG Chartered Accountant and works as a financial accountant working for Kumasi Builders plc.
Kumasi Builders plc is about to finalise its financial statements for the year ended 31 December 20X9 and will release its results in two days’ time.
One of Kwame Osei’s tasks during the frantic year-end work was to perform an impairment review on certain assets owned by the company. There were indications of impairment, but Kwame Osei’s calculation of recoverable amount showed that no assets were impaired.
Kwame Osei has just read an article on spreadsheet error. This led him to review the spreadsheets that he built to perform the recoverable amount calculations, and he has found an error in the logic. This error, if corrected, would have led to the company recognising a material impairment loss.
The loss, if recognised, would lead to the profit figure falling below the level at which Kwame Osei’s bonus is triggered. He is also concerned that his mistake will compromise his future promotion prospects.

Required
Identify and explain the ethical issues arising in the above cases.

Answer

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Tags: Ethics, Financial Reporting, Financial Statements, ICAG, Integrity, Intimidation Threat, Objectivity, Professional Competence, Professional conduct, Self-Interest Threat
Level: Level 2

Topic: Professional and Ethical Issues in Financial Reporting

Tag (SQ): Ethics

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BMIS – L1 – SA – Q13.5 – Professional ethics in accounting and business

Identifies what is not a key element of an ethical code.

BMIS – L1 – SA – Q13.4 – Professional ethics in accounting and business

Defines whistleblowing as reporting unethical or improper activities.

BMIS – L1 – SA – Q13.3 – Professional ethics in accounting and business

Identifies unethical conduct in presenting misleading financial reports.

BMIS – L1 – SA – Q13.2 – Professional ethics in accounting and business

Defines the principle of objectivity for accountants.

BMIS – L1 – SA – Q13.1 – Professional ethics in accounting and business

Identifies principles expected of professional accountants in their work.

BMIS – L1 – QD10 – Professional ethics in accounting and business

Describe differences between business and professional codes of ethics for accountants.

BCL – L1 – Q104 – Governance and ethical issues relating to business

Distinguish between code of ethics and conduct for accounting staff; identify stakeholders and corporate responsibilities.

SCS – L3 – Q39 – Ethics and social responsibility

Identify ethical principles breached in a scenario involving a takeover and confidentiality request.

SCS – L3 – Q30 – Ethical theories

Advise Apea Chemist Ltd on two approaches to managing ethics in organizations.

FR – L2 – Q9 – Professional and Ethical Issues in Financial Reporting

Identify ethical issues in two cases involving financial reporting decisions by ICAG accountants

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BMIS – L1 – SA – Q13.5 – Professional ethics in accounting and business

Identifies what is not a key element of an ethical code.

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BMIS – L1 – SA – Q13.4 – Professional ethics in accounting and business

Defines whistleblowing as reporting unethical or improper activities.

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BMIS – L1 – SA – Q13.3 – Professional ethics in accounting and business

Identifies unethical conduct in presenting misleading financial reports.

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BMIS – L1 – SA – Q13.2 – Professional ethics in accounting and business

Defines the principle of objectivity for accountants.

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BMIS – L1 – SA – Q13.1 – Professional ethics in accounting and business

Identifies principles expected of professional accountants in their work.

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BMIS – L1 – QD10 – Professional ethics in accounting and business

Describe differences between business and professional codes of ethics for accountants.

You're reporting an error for "BMIS – L1 – QD10 – Professional ethics in accounting and business"

BCL – L1 – Q104 – Governance and ethical issues relating to business

Distinguish between code of ethics and conduct for accounting staff; identify stakeholders and corporate responsibilities.

You're reporting an error for "BCL – L1 – Q104 – Governance and ethical issues relating to business"

SCS – L3 – Q39 – Ethics and social responsibility

Identify ethical principles breached in a scenario involving a takeover and confidentiality request.

You're reporting an error for "SCS – L3 – Q39 – Ethics and social responsibility"

SCS – L3 – Q30 – Ethical theories

Advise Apea Chemist Ltd on two approaches to managing ethics in organizations.

You're reporting an error for "SCS – L3 – Q30 – Ethical theories"

FR – L2 – Q9 – Professional and Ethical Issues in Financial Reporting

Identify ethical issues in two cases involving financial reporting decisions by ICAG accountants

You're reporting an error for "FR – L2 – Q9 – Professional and Ethical Issues in Financial Reporting"

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