CPA 09 Ethics and Governance Kit 2013 - Cracked Version PDF

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Download CPA 09 Ethics and Governance Kit 2013 - Cracked Version PDF

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CPA AUSTRALIA

REVISION KIT

PROFESSIONAL LEVEL ETHICS AND GOVERNANCE

A note about copyright Dear Customer Second edition January 2013 ISBN 9781 4453 6610 4 e-ISBN 9781 4453 6942 6 British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library. Published by BPP Learning Media Ltd All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means or stored in any retrieval system, electronic, mechanical, photocopying, recording or otherwise without the prior permission of the publisher. Printed in the United Kingdom by Ricoh Ricoh House Ullswater Crescent Coulsdon CR5 2HR Your learning materials, published by BPP Learning Media Ltd, are printed on paper obtained from traceable sustainable sources.

© BPP Learning Media Ltd 2013

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Ethics and Governance

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

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Contents Page Introduction

v

How to use this Revision Kit

vi

Exam technique

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Q

A

3

73

9

75

25

81

41

88

Multiple choice questions

46

90

Wr itten en re s p ons nse q ues es t ion on s

59

97

C ase stu dy y que t ud ue s tio io ns

63

111

M odule 1 A ccounting and so ciety Multiple choice questions

M odule 2 E thics Multiple choice questions

once cepts M odule 3 Gove r nance con Multiple choice questions

M odule 4 C orpora t ions andd o the he r e ntitie s Multiple choice questions

M odule 5 C orpora t e soci ci al re re spo ponsibi lity

Introduction

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iv

Ethics and Governance

Introduction Welcome to this second edition of BPP Learning Media’s Revision Kit for the Ethics and Governance segment of the CPA Australia Professional level, part of the CPA Program. It is valid for CPA Australia exams in 2013. One of the key criteria for achieving exam success is question practice. There is generally a direct correlation between candidates who revise all topics and practise exam questions and those who are successful in their real exams. This Revision Kit gives you ample opportunity for such practice in the run up to your CPA Australia exams. The Revision Kit is structured to follow the modules of the CPA Australia Study Guide, and comprises banks of multiple choice questions and banks of short form, written response or case study questions as appropriate. Suggested solutions to all questions are supplied. All material is fully up to date as at 31 October 2012. This Revision Kit is part of a suite of supplementary products published by BPP Learning Media for candidates studying for the CPA Australia Professional level exams. Other products include the marketleading BPP Learning Media Passcards, pocket-sized revision cards summarising the key areas of the syllabus, perfect for revision on the move. For further information visit www.bpp.com/learningmedia. We welcome your feedback. If you have any comments about this Revision Kit, or would like to suggest areas for improvement, please e-mail Pippa Riley, Publishing Director, at [email protected]. Good luck in your CPA Australia exams!

BPP LEARNING MEDIA January 2013

Introduction

v

How to use this Revision Kit This Revision Kit comprises banks of practice questions of the style that you will encounter in your CPA Australia exam. It is the ideal tool to use during the revision phase of your studies. All questions in your exam are compulsory so you must revise the whole syllabus. Selective revision will limit the number of questions you can answer and hence reduce your chances of passing. It is better to go into the exam knowing a reasonable amount about most of the syllabus rather than concentrating on a few topics to the exclusion of the rest. You should at all costs avoid falling into the trap of question spotting, that is trying to predict what are likely to be popular areas for questions, and restricting your revision and question practice to those. Practising as many exam-style questions as possible will be the key to passing this exam. You must do questions under timed conditions and ensure you write full answers to the discussion parts as well as doing the calculations. Planning your revision When you enrol for the semester you should make a plan of how you will manage your studies, taking into account the volume of work that you need to do and your other commitments, both work and domestic. Ideally you should aim to complete your study within the time indicated in the target weekly schedule, provided by CPA Australia, so as to ensure you have sufficient revision time available. In this time, you should go through your notes to ensure that you are happy with all areas of the syllabus and practise as many questions as you can. You can do this in different ways, for example: 

revise the subject matter a module at a time and then attempt the questions relating to that module; or



revise all the modules and then build an exam out of the questions in this Revision Kit. Review the exam structure (set out in the Study Guide) and then group together the relevant number of MCQs and longer questions from different syllabus areas to create a three hour exam.

Using the practice questions All of the Professional level core segment exams comprise both multiple choice questions (MCQs) and written response questions, but the precise division of questions varies from segment to segment. The best approach is to select a question and then allocate to it the time that you would have in the real exam. All the practice written response questions in this Revision Kit have mark allocations, so you can calculate the amount of time that you should spend on the question. Each exam is three hours long, with an additional 15 minutes reading time.

For one mark you should allocate time as follows: Segment

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Time for 1 mark

Ethics and Governance (85 marks available in the exam)

2 minutes

Strategic Management Accounting (85 marks available in the exam)

2 minutes

Financial Reporting (65 marks available in the exam)

2.75 minutes

Global Strategy and Leadership (80 marks available in the exam)

2.25 minutes

Ethics and Governance

All MCQs in all the exams are worth one mark each, so the table indicates roughly how long you should allow for each MCQ, both in this Revision Kit and in the real exam. However this is an approximate guide: some MCQs are very short and just require a factual response, which you either know or you don’t, while others are more complex, requiring a series of calculations, which will inevitably take more time. When attempting a written response question, multiply the time per mark by the number of marks, so for example a 6 mark Ethics and Governance question should be allowed: 6 × 2 minutes = 12 minutes. Using the suggested solutions Avoid looking at the answer until you have finished a question. It can be very tempting to do so, but unless you give the question a proper attempt under exam conditions you will not know how you would have coped with it in the real exam scenario. When you do look at the answer, compare it with your own and give some thought to why your answer was different, if it was. In multiple choice questions if you did not reach the correct answer make sure that you work through the explanation or workings provided, to see where you went wrong. If you think that you do not understand the principle involved, go back to your own notes or your CPA Australia study materials and work through and revise the point again, to ensure that you will understand it if it occurs in the exam. For written response or case study questions our suggested solutions are comprehensive, but in some discursive questions it may be that you have made points that are not included in the suggested solution that are equally valid. In the real exams you should be given credit for such points.

Introduction

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Exam technique Using the right technique in the real exam can make all the difference between success and failure. Here are a few pointers: 1.

During the 15 minute reading time at the start, read through the questions and decide in what order you are going to attempt the exam. You have to write your answers in the order set out in the question and answer booklet, but you can attempt the questions in any order that you like. Some candidates like to attempt the easiest questions first, on the basis that will enable them to gain the easiest available marks quickly, and build up their confidence. Some candidates prefer to attempt the MCQs first, as in most cases they form the bulk of the exam, but they will cover many aspects of the syllabus and you will find yourself moving rapidly from topic to topic. So you may prefer to take a look at the written response questions and establish the order in which you would like to attempt those. If you select a question on a topic area about which you feel confident, and do that first, you will build up your confidence right at the start, which will help to calm you if you are nervous and set the tone for the rest of the exam. You should decide what approach is best for you.

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2.

Having established the order that you are going to do the exam, allocate the time available to the questions and work out at what time you will need to stop working on one question or batch of questions and move on to the next. When you reach the end of the allocated time for the question that you are working on, STOP. It is much easier to gain the straight forward marks for the next question than to spend a long time working on the previous question in the hope of gaining one or two final marks.

3.

Make sure that you attempt every MCQ. Do not leave any blank. If you run out of time or are not sure of an answer you should select the option you think is most suitable. You can come back to the question later if time permits.

4.

Read the question. Read it carefully once, and then read it again to ensure that you have picked everything up. Make sure that you understand what the question wants you to do, rather than what you might like the question to be asking you….

5.

Answer all parts of the question. Even if you cannot do all of the calculation elements, you will still be able to gain marks in the discussion parts.

6.

Don’t worry if you think that you have made a mistake in a computational part of a written response question. You will not earn the mark for that particular part, but you will still be able to gain credit for correct application in the later parts of the question, even if you are using the wrong figure.

7.

When starting to read a written response question, especially a long case study, read the requirement first. You will then find yourself considering the requirement as you read the data in the scenario, helping you to focus on exactly what you have to do.

8.

For written response questions, especially longer case studies, plan your answer before you start to write your response. This will help you to focus on the requirements of the question and to avoid irrelevance.

9.

In written response questions, try to make sure that your answer relates to the specifics of the question itself. If you are asked to consider the impact of the scenario on someone named in the question, make sure that you do that, so your answer is as relevant as possible.

10.

If you finish the exam with time to spare, use the rest of the time to review your answers and to make sure that you answered every MCQ.

Ethics and Governance

Module questions

1

2

Module 1 ACCOUNTING AND SOCIETY 1

2

3

4

Which of the following statements about the attributes of a profession are correct? A

They make it possible to distinguish clearly between professions and non-professional occupations.

B

They are attributes that non-professional occupations do not possess.

C

They may exist in non-professional occupations, but to a lesser extent than in professions.

D

They are attributes that make professions more important to society than non-professional occupations.

Accountants have a fundamental duty or ‘service ideal’ towards A

employers.

B

clients.

C

society at large.

D

regulators.

The professional capabilities that accountants require in order to implement accounting systems and their constructs and therefore to achieve appropriate reporting in each circumstance include A

technical knowledge and soft skills only.

B

technical knowledge and extensive experience only.

C

soft skills and extensive experience only.

D

technical knowledge, soft skills and extensive experience.

Accounting is used to measure and report on the level of performance by a manager or business unit. In light of this statement, which of the following is TRUE?

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6

A

Accounting therefore has a broad social impact at both the micro and the macro level.

B

Accounting therefore has a broad social impact at the micro but not the macro level.

C

Accounting therefore has a broad social impact at the macro but not the micro level.

D

Accounting does not have a broad social impact at either the micro or the macro level.

An accountancy firm is accused of failure to conduct an audit with due care, after disclosure of a material misstatement in the audited financial report of a major corporate client. As a result, the professional accounting body imposed a large fine on the firm for its unprofessional behaviour. What should NOT be a conclusion from this incident? A

A requirement for any profession is that its professional body must have the power to discipline its members.

B

The governing body of a profession has the power to control the actions of its members.

C

The governing body of a profession may rely on the courts to impose disciplinary action on its members.

D

The actions of the governing body of a profession must be credible in the opinion of the general public.

The two categories of skills required by a member of CPA Australia are A

communication skills and technical skills.

B

soft skills and technical skills.

C

communication skills and social skills.

D

soft skills and social skills.

Module questions

3

7

Complete the following sentence: A CPA’s technical skills, knowledge and experience (TSKE)

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9

10

11

12

A

comprises financial reporting/analysis and management accounting only.

B

comprises includes taxation and financial reporting/analysis only.

C

extends beyond financial reporting/analysis, taxation and management accounting.

D

cannot be specified but does not have to include taxation.

According to Wilensky (1964) what is ‘the pivot around which the claim to professional status revolves’? A

Professional conduct

B

Integrity

C

Confidentiality

D

Service ideal

To fulfil its continuing professional development (CPD) learning requirements, a member of CPA Australia must undertake A

TSKE activities only.

B

SSKE activities only.

C

both TSKE and SSKE activities.

D

a general commitment to development only.

According to Blanthorne’s research, which are the most important skills for partnership appointments in CPA firms? A

1 Technical skills, 2 Leadership skills, 3 Communication skills

B

1 Interpersonal skills, 2 Leadership skills, 3 Communication skills

C

1 Interpersonal skills, 2 Leadership skills, 3 Technical skills

D

1 Technical skills, 2 Interpersonal skills, 3 Communication skills

Which of the following is NOT listed by IFAC’s professional accountant in business (PAIB) committee as a main activity of a professional accountant in business? A

Creating value through the effective use of resources

B

Interpreting information so management can formulate strategy

C

Reporting to stakeholders under GAAP

D

Implementation of business unit plans

Consider the following two statements about a CPA who becomes a manager in a large business environment: 1

He or she is subject to entrepreneurial pressures and must comply with professional ethical requirements though not the service ideal

2

He or she may be called upon to be involved in risk management

Are these statements true or false?

4

A

Statement 1 True; Statement 2 False

B

Statement 1 True; Statement 2 True

C

Statement 1 False; Statement 2 False

D

Statement 1 False; Statement 2 True

Ethics and Governance

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In comparis...