Solutions Manual with Test Bank for Business and Professional Ethics 9th Edition By Leonard Brooks

,DOWNLOAD THE Test Bank for Business and Professional Ethics for Direc
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tors Executives Accountants 8th Edition Brooks
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Businessg&gProfessionalgEthicsgforgDirectors,gExecutivesg&gAccountants,g6e

Multiple Choice Questions
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Chapterg2g g Ethicsg&gGovernancegScandals

1. Asgagresultgofgthegspectaculargstockgmarketgcrashging1929,gtheggovernmentgimplementgthe
SecuritiesgActgofg1933,gthegSecuritiesgActgofg1934,gasgwellgasgwhichgofgthegfollowinggacts:
a. Glass-SteagallgAct
b. InvestmentgAdvisersgAct
c. Gramm-Leach-BlileygAct
d. Allgofgthegabove
e. Onlygagandgbg

ANSWER: e

2. Ing1984,gEdwardgFreemengpublishedgangarticlegongstakeholdergtheory.gWhichgofgthegfollowinggi
sgnotgtrue?
a. Agfirmgneedsgthegsupportgofgitsgstakeholdersgtogenhancegthegfirm’sgreputation.
b. Stakeholdergtheorygtookgyearsgtogmature.
c. Stakeholdergtheorygisgnotgagusefulgframeworkgforgthoseginterestedginggovernance.
d. Firmsgneedgstakeholdersgtogachievegtheirgcorporategobjectives.
e. Stakeholdergtheorygoccurredgatgthegsamegtimegasgthegrisegingsocialgandgcorporatega
ctivism.

ANSWER: c

3. WhichgofgthegfollowinggisgnotgcoveredgundergthegSarbanes-OxleygActgofg2002g(SOX)?
a. Thegresponsibilitiesgofgshareholders
b. Thegresponsibilitiesgofgthegboardgofgdirectors
c. Thegresponsibilitiesgofgmanagement
d. Thegresponsibilitiesgofgauditors
e. Conflictsgofginterestg

ANSWER:g a

4. ThegoverallgrequirementgofgthegInternalgRevenuegServicegCircularg230gisgtogensuregthatgtaxgp
rofessionals:
a. Knowgtheirgclients
b. Alwaysgdevelopgtaxgplansgforgtheirgclients
c. Makegtaxgplanninggsuggestionsgthat,gevengifgtheygdon’tghavegagchancegofgsuccess,gwillgs
avegthegclientgsomegmoneygingthegshort-term
d. Nevergdevelopgtaxgshelters
e. Onlygbegprofessionalgaccountantsg

ANSWER:g a




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tors Executives Accountants 8th Edition Brooks
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5. Agcollateralizedgdebtgobligationg(CDO):
a. Isganginsurancegpolicygthatganyginvestorgcangpurchase
b. Isgagbondgthatgisgsecuredgbygagportfoliogofgmortgages
c. Protectsganginvestorgingthegeventgthatgthegissuergofgthegmortgagegdefaultsgongthegc
ontract
d. Actsgasgaghedgegagainstgchangesginginterestgrates
e. WeregoutlawedgwithgthegpassagegofgthegDodd-
FrankgWallgStreetgReformgandgConsumergProtectiongAct.

ANSWER:g b

6. Whichgofgthegfollowinggisgnotgagsigngofgangethicalgcollapsegwithingangorganization,gaccordinggt
ogMariannegJennings?
a. Pressuregtogmeetgfinancialggoals
b. Hubris
c. Nepotism,gfavoritismgandghiringgsycophants
d. Angopengandgcandidgorganizationalgculture
e. Weakgboardsgofgdirectorsg

ANSWER:g d

7. ThegU.S.gFederalgSentencinggGuidelinesgweregintroducedging1991gto:
a. Helpgjudgesgformulategsentences.
b. Avoidgsentencesgthatgaregtooglight.
c. Signalgpotentialgsentencesgtogexecutivesgandgdirectors.
d. Encouragegexecutivesgandgdirectorsgtogavoidgenvironmentalgdamage.
e. Allgofgthegabove.

ANSWER:ge

8. DuegdiligencegprogramsgdevelopedgtogreducegpenaltiesgleviedgundergthegU.S.gFederalg
SentencinggGuidelinesgforgenvironmentalgharmgdidgnotginclude:
a. Awarenessgprogramsgforgemployees.
b. Guidelinesgforgemployees.
c. Compliancegoversightgbygcorporategofficials.
d. Rewardsgforgnon-compliance.
e. Encouragementgforgwhistleblowers.

ANSWER:gd

9. WhichgofgthegfollowinggfinancialgcrisesgorgfiascosgweregnotgrelatedgtogthegSubprimegLendingg
Crisis?
a. BeargStearns
b. LehmangBrothers
c. BerniegMadoff




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tors Executives Accountants 8th Edition Brooks
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d. AIG
e. GalleongGroup

g ANSWER:gcgandge

10. Whichgwasgtheglargestgfraudgorgbankruptcygleadinggtogthegcrisisgofginvestorgconfidenceging2
002?
a. Enron
b. GlobalgCrossing
c. WorldCom
d. HIHgInsurance
e. XeroxgANS

WER:gWorldCom

11. Thegcrisisginginvestorgconfidenceging2002gwasgcausedgby:
a. Lackgofgintegritygofgbusinessgleaders.
b. Manipulationgofgfinancialgresults.
c. BoardsgofgDirectorsgthatgdidgnotgprovidegpropergoversight.
d. Findingsgofgalertgauditors
e. Allgofgthegabove.

ANSWER:ga,gb,gandgc.

12. SOXgcontainedgsectionsgwithgregardgtogthegauditgand/orgauditgcommitteegthatgweregdesignedgt
o:
a. Increasegthegindependencegofgmanagement.
b. Increasegthegfinancialgliteracygofgauditgcommitteegmembers.
c. Limitgthegconflictsgofginterestgrelatedgtogthegservicesgangauditorgcangperform.
d. Restrictgthegabilitygofgauditorsgtogservegongthegauditgcommittee.
e. Allgofgthegabove.

ANSWER:gbgandgc

13. ThegU.S.gInternalgRevenuegServiceg(IRS)gimplementedgCircularg230gtogremedygproblemsgf
oundgwithgregardgtogthegmarketinggofgtaxgsheltersgthoughtgto:
a. Havegnogothergpurposegexceptgtogreducegtaxes.
b. Haveglowergthang50%gchancegofgsuccessgifgchallengedgbygthegIRS.
c. Notgbegingaccordancegwithgclient’sgneeds.
d. Creategfictitiousglosses.
e. Allgofgthegaboveg

ANSWER:ge

14. Whygdidn’tginvestorsgcaughtgingthegSubprimegLendinggCrisisgtakegearliergnotegofgthegrisksgi
nherentginginvestmentsgknowngasgcollateralizedgdebtgasgobligationsg(CDOs)?




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