3.5 Which of the following is NOT a principle of corporate governance?
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1 .2.5 The following statements relate to International Standards on Auditing (ISAs) and professional auditors:(1) All ISAs must be applied during the course of an audit.(2) ISAs override local regulations.(3) The entire text of a standard must be understood in order to apply its requirements.(4) ISAs are rules-based and all rules must be applied.(5) An individual is appropriately qualified as an auditor on passing professional examinations.(6) In most jurisdictions only a statutory auditor is allowed to carry out audits of companies. Which of the above statements are true?
A All of them B 3 and 6 only C 1, 3 and 6 only D 1, 2, 5 and 6 only
2 .2.6 Who, in most jurisdictions, may remove the auditors?
A Directors B Members C Legal authorities
3 .2.7 Which of the following is generally accepted as a right of an auditor?
A To have access to the company’s books, accounts and records B To require from company officials any information and explanations on any matter whatsoever C To report to any legal authority any matter the auditor considers that authority needs to know D To attend any board or committee meeting
4 .3.2 The following are statements that could be made about corporate governance:(1) The system by which business corporations are directed and controlled.(2) It involves entrepreneurism, innovation, development and exploration.(3) It aims to achieve a long-term increase in shareholder value.(4) It narrows the expectation gap.(5) It only applies to entities that are listed on a stock exchange.What combination of these statements best describes the meaning of corporate governance?
A 1, 4 and 5 B 1, 2 and 5 C 1, 2 and 3 D 2, 3 and 5
5 .3.4 Under corporate governance it is illegal for the Chief Executive Officer to also act as the Chairman of the Board.Is this statement true or false?
A True B False
7 .3.1 Which of the following correctly states the composition of an audit committee?
A Executive directors only B Non-executive directors only C Non-executive directors and internal auditors
8 .3.8 Which of the following is NOT a recommendation of the UK Corporate Governance Code?
A There should be a clear division of responsibility between the running of the board and running of the company’s business B All members of the board, excluding the chairman, should be independent nonexecutive directors C Executive director remuneration should be linked to corporate and individua...
9 .3.3 Who do audit committees normally liaise between?
A The internal and external auditors B The internal auditor and entity’s staff C The executive and non-executive directors D The auditors and the directors
10 .3.6 Which of the following best describes an advantage of an audit committee?
A It enables executive directors to contribute independent judgement to matters of critical importance B It offers the internal auditors a direct, formal link with the executive directors C It enables management to delegate a thorough and detailed review of audit matters D It provides effective and ...
