CIMA Fundamentals of Ethics - Corporate Governance and Business Law : BA4

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

1. Z Ltd intends to participate in a "substantial property transaction" with one of its directors. Which of the following is correct in relation to substantial property transactions?
(i) The value of the asset must exceed 10% of the company's net assets and be more than £5,000.
(ii) The transaction must be approved by the shareholders.
(iii) The director must disclose his interest in the transaction.

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

2. Badger has just been offered a job after completing a series of long interviews.
Which of the following would legally form the employment contract between him and his employer:

A) A handshake
B) A verbal declaration
C) A signed formal document
D) Any of the above

3. Which of the following are listed among the IFAC's drivers for sustainable organisational success?
Select ALL that apply.

A) Effective leadership and strategy
B) Innovation and adaptability
C) Operational excellence
D) People and talent management
E) Integrity and ethical behaviour
F) Disclosure and transparency
G) Rights and equitable treatment of shareholders
H) Customer and stakeholder focus
I) Effective and transparent communication
J) Interests of other stakeholders
K) Role and responsibilities of the board
L) Integrated governance, risk and control
M) Financial management

4. P contracted to buy a computer from CD (Retailers) Ltd. The contract contained a term excluding liability for any breach of the condition implied by the Sale of Goods Act 1979 that the goods should be of
"satisfactory quality".
Which of the following is correct?

A) Conditions implied by the Sale of Goods Act 1979 cannot be excluded in any kind of sale.
B) If this is a consumer sale the clause is void unless it can be shown to be reasonable.
C) If this is a consumer sale the clause is void.
D) If this is a non-consumer sale the clause is valid.

5. Which of the following is an advantage of carrying on a business through the medium of a private company limited by shares?

A) The fact that business can be earned on with a minimum of one company secretary.
B) The fact that business can be carried on with a minimum of two directors
C) The ability to keep the articles of association private
D) The ability to carry on business without holding an annual general meeting

Solutions: