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

1. Which of the following statements about the relationship between external and internal auditors is FALSE?

A) Oversight of the work of external auditors is the responsibility of the chief internal auditor
B) Internal auditors may provide engagement work programs and working papers to external auditors
C) Internal and external auditors should meet regularly to ensure timely and efficient completion of the work
D) In some countries, there is a statutory requirement to have both an internal and an external audit

2. John is conducting an external audit on a biscuit factory. He wants to make sure that his audit is comprehensive and thorough. To do this, he aims to make full use of his powers and rights.
Which of the following is John allowed to do?
Select ALL that apply.

A) Review and report on the performance of management.
B) Ask for explanations from officers of the company.
C) Ask to be notified of any shareholder meetings.
D) Actively investigate fraudulent activity.
E) Present arguments at a meeting if there is a proposal to remove the auditors.
F) Access the company's books and records.
G) Ask responsible officers to produce relevant documents.

3. Complying with relevant laws and legislations demonstrates part of which CIMA Code of Ethics fundamental principle?

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

4. Which of the following is NOT an essential element of a valid simple contract?

A) Consideration.
B) Agreement.
C) Written terms.
D) Intention to create legal relations.

5. Which of the following remedies is available as of right in the event of a breach of contract?
(i) Specific performance.
(ii) Damages.
(iii) An injunction.

A) (ii) only
B) (iii) only
C) (ii) and (iii) only
D) (i) only

Solutions: