Quiz 1/MAS 4 (BSA 2B MAS4 2NDSEM AY2020-2021)Immersive Reader
Topic 1 The Accountancy Profession
Topic 2 Corporate Governance
1.Richard, CPA, performs accounting services for Norton Corporation. Norton wishes to offer shares to
the public and asks Richard to audit the financial statements. Richard refers Norton to Cruz, CPA, who is
more competent in the area of registration statements. Cruz performs the audit of Norton's financial
statements and subsequently thanks Richard for the referral by giving Richard a portion of the audit fee.
Richard accepts the fee. Who, if anyone, has violated professional ethics?
(0/1 Point)
Only Richard.
Both Richard and Cruz.
Only Cruz.
Neither Richard nor Cruz.
2.S1: The BROC should be composed of at least three members, the majority of whom should be
independent directors, including the Chairman.
S2: The Board should establish an Internal Relations Office (IRO) to ensure constant engagement with its
shareholders. The IRO should be present at every shareholders’ meeting.
(0/2 Points)
Only S1 is true
Only S2 is true
Both are true
Both are false
3.Which of the following statements concerning the practice of accountancy is correct?
(1/1 Point)
A CPA is in the practice of accountancy in the government when he/she is involved in the audit or
verification of financial transactions and accounting records of his/her clients.
A CPA is in public accountancy when he/she renders his/her professional services as a CPA to more than
one client on a fee basis in the design, installation, review, and revision of accounting systems and
controls.
A CPA is in the practice of accountancy in the academe/education when he/she is in an educational
institution teaching any of the subjects included in the BSA curriculum.
A CPA is in the practice of accountancy in commerce and industry when his/her position requires civil
service eligibility as a Certified Public Accountant
,4.S1:The Board should have at least three independent directors, or such number as to constitute atleast
one-third of the members of the Board, whichever is higher.
S2:The Board’s independent directors should serve for a maximum cumulative term of nine years.
(2/2 Points)
Only S1 is true
Only S2 is true
Both are true
Both are false
5.A CPA, be it his/her individual capacity, or as a partner or as a staff member in an accounting or
auditing firm, offering or rendering, or both, to more than one client on a fee basis or otherwise, services
such as the audit or verification of financial transaction and accounting records.
(1/1 Point)
Practice of Public Accountancy
Practice and Commerce and Industry
Practice in Education/Academe
Practice in the Government
6.S1: The Board’s annual self-assessment should be supported by an external facilitator every two years.
S2: The Company should have a policy requiring all directors and officers to disclose/report to the
company any dealings in the company’s shares within five business days.
(2/2 Points)
Only S1 is true
Only S2 is true
Both are true
Both are false
7.Safeguards created by the profession, legislation or regulation, include the following, except
(0/1 Point)
Educational, training and experience requirements for entry into the profession.
Continuing education requirements.
Legislation governing the independence requirements of the firm.
, Policies and procedures that emphasize the assurance client’s commitment to fair financial reporting.
8.In which of the following circumstances would a CPA be bound to refrain from disclosing confidential
information obtained during a professional engagement?
(1/1 Point)
The CPA is issued a summons enforceable by a court order that orders the CPA to present confidential
information.
A major stockholder of a client company seeks accounting information from the CPA after management
declined to disclose the information.
Confidential client information is made available as part of a quality review of the CPA's practice by a
review team authorized by the BOA.
An inquiry by a disciplinary body of a state CPA society requests confidential client information.
9.The appearance of independence of a CPA, or that CPA's firm, could be impaired if the CPA
(0/1 Point)
Owns a unit in a cooperative apartment house where each unit has a vote in the cooperative, and the
CPA, who does not participate in the management, has been retained as the auditor for the cooperative.
Joins a trade association that is a client and serves in a nonmanagement capacity.
Accepts a gift from a client.
None of the above.
Option 2
10.The provision of services by a firm or network firm to an audit client that involve the design
and implementation of financial information technology systems that are used to generate
information forming part of a client's financial statements may most likely create
(1/1 Point)
Self-interest threat
Self-review threat
Intimidation threat
Familiarity threat
11.A CPA-lawyer, acting as a legal counsel to one of his audit client, is an example of
(1/1 Point)
Self-interest threat
Topic 1 The Accountancy Profession
Topic 2 Corporate Governance
1.Richard, CPA, performs accounting services for Norton Corporation. Norton wishes to offer shares to
the public and asks Richard to audit the financial statements. Richard refers Norton to Cruz, CPA, who is
more competent in the area of registration statements. Cruz performs the audit of Norton's financial
statements and subsequently thanks Richard for the referral by giving Richard a portion of the audit fee.
Richard accepts the fee. Who, if anyone, has violated professional ethics?
(0/1 Point)
Only Richard.
Both Richard and Cruz.
Only Cruz.
Neither Richard nor Cruz.
2.S1: The BROC should be composed of at least three members, the majority of whom should be
independent directors, including the Chairman.
S2: The Board should establish an Internal Relations Office (IRO) to ensure constant engagement with its
shareholders. The IRO should be present at every shareholders’ meeting.
(0/2 Points)
Only S1 is true
Only S2 is true
Both are true
Both are false
3.Which of the following statements concerning the practice of accountancy is correct?
(1/1 Point)
A CPA is in the practice of accountancy in the government when he/she is involved in the audit or
verification of financial transactions and accounting records of his/her clients.
A CPA is in public accountancy when he/she renders his/her professional services as a CPA to more than
one client on a fee basis in the design, installation, review, and revision of accounting systems and
controls.
A CPA is in the practice of accountancy in the academe/education when he/she is in an educational
institution teaching any of the subjects included in the BSA curriculum.
A CPA is in the practice of accountancy in commerce and industry when his/her position requires civil
service eligibility as a Certified Public Accountant
,4.S1:The Board should have at least three independent directors, or such number as to constitute atleast
one-third of the members of the Board, whichever is higher.
S2:The Board’s independent directors should serve for a maximum cumulative term of nine years.
(2/2 Points)
Only S1 is true
Only S2 is true
Both are true
Both are false
5.A CPA, be it his/her individual capacity, or as a partner or as a staff member in an accounting or
auditing firm, offering or rendering, or both, to more than one client on a fee basis or otherwise, services
such as the audit or verification of financial transaction and accounting records.
(1/1 Point)
Practice of Public Accountancy
Practice and Commerce and Industry
Practice in Education/Academe
Practice in the Government
6.S1: The Board’s annual self-assessment should be supported by an external facilitator every two years.
S2: The Company should have a policy requiring all directors and officers to disclose/report to the
company any dealings in the company’s shares within five business days.
(2/2 Points)
Only S1 is true
Only S2 is true
Both are true
Both are false
7.Safeguards created by the profession, legislation or regulation, include the following, except
(0/1 Point)
Educational, training and experience requirements for entry into the profession.
Continuing education requirements.
Legislation governing the independence requirements of the firm.
, Policies and procedures that emphasize the assurance client’s commitment to fair financial reporting.
8.In which of the following circumstances would a CPA be bound to refrain from disclosing confidential
information obtained during a professional engagement?
(1/1 Point)
The CPA is issued a summons enforceable by a court order that orders the CPA to present confidential
information.
A major stockholder of a client company seeks accounting information from the CPA after management
declined to disclose the information.
Confidential client information is made available as part of a quality review of the CPA's practice by a
review team authorized by the BOA.
An inquiry by a disciplinary body of a state CPA society requests confidential client information.
9.The appearance of independence of a CPA, or that CPA's firm, could be impaired if the CPA
(0/1 Point)
Owns a unit in a cooperative apartment house where each unit has a vote in the cooperative, and the
CPA, who does not participate in the management, has been retained as the auditor for the cooperative.
Joins a trade association that is a client and serves in a nonmanagement capacity.
Accepts a gift from a client.
None of the above.
Option 2
10.The provision of services by a firm or network firm to an audit client that involve the design
and implementation of financial information technology systems that are used to generate
information forming part of a client's financial statements may most likely create
(1/1 Point)
Self-interest threat
Self-review threat
Intimidation threat
Familiarity threat
11.A CPA-lawyer, acting as a legal counsel to one of his audit client, is an example of
(1/1 Point)
Self-interest threat
