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CIMA Fundamentals of Ethics - Corporate Governance and Business Law Sample Questions:

1. Jo is employed as management accountant of a large retailer. Jo has been asked to call a supplier and promise settlement of their account 'next week'. Jo is aware that her employer will definitely not have sufficient funds available to make the payment. If Jo accepts the request, which of the following
'fundamental principles' of CIMA's Code of Ethics will be compromised?

A) Integrity
B) Objectivity
C) Confidentiality
D) Professional behavior

2. James works for a large company in the City. He likes working there, though he has just identified an issue of fraud within the company.
He has double-checked the facts, deduced that the fraudulent activity is both unethical and illegal, identified a number of ethical principles that have been breached and identified who is involved and who could be affected.
What should he do next?

A) Quit his job straight away and find a new job within the profession.
B) Quit his job and move to a different department.
C) Do nothing - some fraudulent activity is to be expected in large companies.
D) Inform his manager or a colleague.
E) Inform an external body - e.g. an auditor or regulatory body.

3. Which of the following best describes the consequences of being found to be unethical for an individual CIMA member?

A) Loss of reputation, suppliers and customers
B) Loss of reputation, public trust and customers
C) Loss of reputation, status and earning potential.
D) Loss of reputation, credibility and Chartered Institute status.

4. A Ltd is under contract to manufacture machinery for B Ltd for £200,000. Which of the following is a valid excuse for A Ltd failing to complete the contract on time?

A) A number of A Ltd's key workers were absent through illness.
B) A Ltd's factory was flooded.
C) A Ltd's employees went out on strike.
D) A Ltd had taken on too many orders and had to give priority to its regular customers.

5. Which of the following is NOT one of the fundamental principles of CIMA's Code of Ethics?

A) Integrity
B) Objectivity
C) Respect
D) Confidentiality

Solutions: