ACC112: CORPORATE GOVERNANCE, BUSINESS ETHICS,

RISK MANAGEMENT AND INTERNAL CONTROL

Teachers’ Guide Module #08

Name: ____________________________________________________________ Class number: _______

Section: ____________ Schedule: _____________________________________ Date: _______________

Materials:
LEARNING OBJECTIVE: Student Activity Sheet;
This assessment measures the competence of the student in terms pencil with eraser and ball pen
of his/her application of knowledge and skills in the following topics:
1. SEC Code of Corporate Governance
2. Introduction to Ethics
3. Business Ethics

ACC 112 - CORPORATE GOVERNANCE, BUSINESS ETHICS, RISK MANAGEMENT AND INTERNAL
CONTROL
P1 Quiz 2

GENERAL DIRECTIONS
READ THIS PAGE BEFORE STARTING THE ASSESSMENT

This test is composed of two (3) sections and has a total score of sixty (5) points. You have one (1) hour
to finish this examination. The composition is as follows:
(1) Multiple-choice question Section. The questions in this section is with four answer choices. The test
is composed of ten (10) questions and is rated as one (1) point each.
(2) Enumeration Section. The test is composed of three (2) problems with several
sub-problems/requirements. Please see rating per problem/requirement.
(3) Essay Section. The test is composed of three (3) problems with several sub-problems/requirements.
Please see rating per problem/requirement.
● All things unnecessary for the test must be put in front of the testing area. Use BLACK or BLUE ink
ballpen only. Write all your answers on the designated space. Further, erasures are strictly NOT
allowed and will invalidate your answers.
● You may NOT use smart phones or reference materials during the testing session. Only the allowed
calculators should be used.
● Try to answer all questions. In general, if you have some knowledge about a question, it is better to try
to answer it. You will not be penalized for guessing.
● Be sure to allocate your time carefully so you can complete the entire test within the exam session. You
may go back and review your answers at any time during the exam session.
● Those who are caught cheating or doing acts not allowed during the exam shall be instructed to
surrender their test papers and shall leave the testing room immediately. Subsequently, their papers
shall be rated as ZERO.

This document is the property of PHINMA EDUCATION

 ACC112: CORPORATE GOVERNANCE, BUSINESS ETHICS,
RISK MANAGEMENT AND INTERNAL CONTROL
Teachers’ Guide Module #08

Name: ____________________________________________________________ Class number: _______

Section: ____________ Schedule: _____________________________________ Date: _______________

This concludes the instruction page.

You may now begin answering.
MULTIPLE CHOICE

________1. Business ethics is the application of ethics to the special problems and opportunities
experienced by business people.
a. True
b. False.

________2. Which of the following statements is untrue

a. Companies should set up a remuneration committee consisting of independent non-executive directors.
b. The remuneration of the non-executive directors should be determined by the executives.
c. The model articles provide that directors should not be permitted to determine their own levels
of remuneration.
d. Remuneration committees should consist of at least three directors, although in smaller companies, this
may be reduced to two

________3. What is meant by separation of ownership and control?

a. That the owners of companies have become separated from those who control companies.
b. That the law should seek to keep the owners and controllers of company apart in order to avoid an
over-concentration of power High pay will render the board less competent.
c. That owners and controllers of companies should not act in concert to defeat resolutions.
d. hat those who control the company should be separate to those who own it

________4. The only social responsibility that a business have is to focus on how business decisions affect
company operations:
a. True
b. False

________5. Which of the following is the study and practice of decisions about what is good, or right?
a. Ethics
b. Consequences
c. Law
d. Morals

________6. An electrician working in a small town is the only electrician within a 100-mile radius. He knows
that the people who have medical equipment at home have the highest need for power, so he charges
them the double to fix problems with their electricity, compared with the average customer. The community
is angry about this choice. the business practice is most likely?
a. Ethical because it is not illegal for a company to set its prices based on maximizing profits.

This document is the property of PHINMA EDUCATION

 ACC112: CORPORATE GOVERNANCE, BUSINESS ETHICS,
RISK MANAGEMENT AND INTERNAL CONTROL
Teachers’ Guide Module #08

Name: ____________________________________________________________ Class number: _______

Section: ____________ Schedule: _____________________________________ Date: _______________

b. Ethical because owners should focus only on the impact of decisions of the firm.
c. Unethical because it is against the law for a company to charge one customer more than another.
d. Unethical because businesses operate in a community and communities have expectations for behavior
of individuals, groups, and businesses.

________7. Which of the following if true regarding business ethics?

a. Business ethics results in a set of correct decisions and does not simply refer to standards of business conduct.
b. Business ethics produces a list of correct business decisions that all ethical businesses will make so long as the
theory of rule utilitarianism is followed.
c. Business ethics produces a list of correct business decisions that all ethical businesses will make so long as the
theory of virtue is followed by a fiduciary duty.
d. Business ethics refers to standards of business conduct but does not result in a set of correct decisions.

________8. Which of the following are stakeholders of a business?

a. Employees but not shareholders
b. Shareholders, employees, customers, and management
c. Shareholders but not employees
d. Customers but not employees or shareholders

________9. Business ethics results in a set of correct decisions .

a. True
b. False

________10. A company wants to open a branch in a foreign country but discovers it would have to bribe
government officials to get a permit to obtain materials necessary to build its headquarters. Which of the
following is an example of an ethical response?
a. Paying the bribe because the company’s first obligation is to its shareholders.
b. Paying the bribe because it is customary in the country where business is to be constructed.
c. Not paying the bribe and bringing in outside materials from foreign country to complete the construction.
d. Not paying the bribe and convincing a local company to illegally sell materials to them, since demanding bribes is
unethical behavior..

Part II. Enumeration

1. Give the two primary reason why people act unethically? (4 pts)
Answer:
1. The person ethical standards are different from those of the society as a whole
2. Person chooses to act selfishly.
2. Give at least 6 characteristic and values associated with ethical behavior.
Answer:
● Integrity

This document is the property of PHINMA EDUCATION

 ACC112: CORPORATE GOVERNANCE, BUSINESS ETHICS,
RISK MANAGEMENT AND INTERNAL CONTROL
Teachers’ Guide Module #08

Name: ____________________________________________________________ Class number: _______

Section: ____________ Schedule: _____________________________________ Date: _______________

● Honesty

● Trustworthiness and Promise Keeping

● Loyalty md Confidentiality

● Fairness and Openness

● Caring for others

● Respect for Others

● Responsible Citizenship

● Pursuit of excellence

● Accountability

Part III. Essay (10 points each)

1. Why organization require business ethics and what are the benefits of ethical organization?

Suggested Answer:
⮚ Ethics helps business determines the right and wrong practices.
⮚ To make business realize that they cannot employ double standards to the actions of other people and
their own actions.
⮚ To show businessmen that common practices which they have thought to be right because they see
other businesses doing it, are really wrong.
⮚ To serve as standards or ideal upon which a business conduct should be based.

Advantages are positive impact in economic, social, environmental and business.

2. Explain the purpose of having an independent internal audit function in a publicly-listed corporation as required by the
SEC Code of Corporate Governance.
Suggested Answer:
⮚ Provides an independent risk-based assurance service to the board, audit committee and
management.
⮚ Able to perform regular and special audit as contained in the annual audit plan

This document is the property of PHINMA EDUCATION

 ACC112: CORPORATE GOVERNANCE, BUSINESS ETHICS,
RISK MANAGEMENT AND INTERNAL CONTROL
Teachers’ Guide Module #08

Name: ____________________________________________________________ Class number: _______

Section: ____________ Schedule: _____________________________________ Date: _______________

⮚ Performs consulting and advisory services related to governance and control

⮚ performs compliance audit of relevant laws, rules and regulations.
⮚ Reviews, audit and assesses the efficiency and effectiveness of the internal control
⮚ Evaluates operations or programs to ascertain whether results are consistent with established
objectives and goals
⮚ Evaluates specific operations at the request of the Board or Management as appropriate
⮚ Monitors and evaluates governance processes.

3. Explain the impact of business ethics in the society.

Suggested Answer:

⮚ Role and rights of employees in business and industry has been recognized by the employer

⮚ Employee tends to be more responsible and sensible to their duties leading toward smooth and rapid
growth of local, national and international businesses.
⮚ Efficient delivery of goods and services at the right price.

-NOTHING FOLLOWS-

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