About Ethics In Accounting (58a)

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  • 1/10 Questions

    Generally, ethical behavior applies at all times, in any function in business. 

    • True
    • False
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About This Quiz

This quiz assesses understanding of ethics in accounting, focusing on integrity, objectivity, disclosure, and internal control systems. It evaluates knowledge of ethical standards vital for accountants, highlighting the effects of ethics on business reputation and legal compliance.

About Ethics In Accounting (58a) - Quiz

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  • 2. 

    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.

    • True

    • False

    Correct Answer
    A. True
    Explanation
    The "separation of functions within the department" refers to the practice of dividing different tasks and responsibilities among different individuals within the accounting department. This is an example of an internal control because it helps to prevent fraud and errors by ensuring that no single person has complete control over a financial transaction from start to finish. By separating functions, there is a system of checks and balances in place, reducing the risk of unethical behavior and promoting transparency and accuracy in accounting practices.

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  • 3. 

    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.

    • Disclosure, internal control, off-balance sheet, 802, disclosure

    • Disclosure, internal control, off-balance sheet , 802

    • Disclosure, off-balance sheet, 802, internal control

    Correct Answer
    A. Disclosure, internal control, off-balance sheet , 802
    Explanation
    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.

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  • 4. 

    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: 

    • Credibility

    • Competence

    • Confidentiality

    • Integrity

    • Materiality

    Correct Answer
    A. Materiality
    Explanation
    The IMA notes the following ethical standards in managerial accounting: competence, confidentiality, integrity and credibility

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  • 5. 

    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.

    • From conflicts of interest

    • Disclosing client information

    • Questionable business relationships

    • All of the above

    Correct Answer
    A. All of the above
    Explanation
    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.

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  • 6. 

    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.

    • Subjective, trust, honesty, stock accounts

    • Objective, trust, honesty, cash accounts

    • Subjective, trust, honesty, cash accounts

    Correct Answer
    A. Subjective, trust, honesty, cash accounts
    Explanation
    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.

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  • 7. 

    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:

    • Business reputation

    • Personal consequences

    • Criminal activities

    • Usefulness of financial statements

    Correct Answer(s)
    A. Business reputation
    A. Personal consequences
    A. Criminal activities
    A. Usefulness of financial statements
    Explanation
    The article discusses the effects of ethics in accounting, including the impact on business reputation, personal consequences, criminal activities, and the usefulness of financial statements. Ethics in accounting can affect a company's reputation, as unethical practices can damage trust and credibility. It can also have personal consequences for individuals involved, such as loss of job or legal repercussions. Additionally, unethical accounting practices can involve criminal activities, such as fraud or embezzlement. Finally, ethics in accounting is crucial for ensuring the accuracy and reliability of financial statements, which are used by stakeholders to make informed decisions.

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  • 8. 

    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: 

    • Honesty

    • Accuracy

    • Impartiality

    • Objectivity

    • There are no clear roles and responsibilities in the group; people just tend to run.

    Correct Answer
    A. 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.

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  • 9. 

    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.

    • Honest, accurate and forthright

    • Accurate, candid and forthright

    • Honest, candid and forthright

    • Honest, candid and accurate

    • Each member of the relay team has a very defined role and set of responsibilities in order to win the race.

    Correct Answer
    A. Honest, candid and forthright
    Explanation
    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.

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  • 10. 

    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."

    • FASB

    • AICPA

    • SEC

    • GAAP

    Correct Answer(s)
    A. FASB
    A. SEC
    Explanation
    The article discusses the entities that created the Generally Accepted Accounting Principles (GAAP) which define the ethical practices and principles of accounting used by businesses. The Securities and Exchange Commission (SEC) and the Financial Accounting Standards Board (FASB) are mentioned in the article as being responsible for the creation of GAAP. The American Institute of Certified Public Accountants (AICPA) is not mentioned as being directly involved in the creation of GAAP.

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  • Current Version
  • Mar 21, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Sep 15, 2014
    Quiz Created by
    Navamaestro
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