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CIMA BA4 Exam Syllabus Topics:

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

1. T, a Sales Representative of E plc, made an appointment to see you in the hope of persuading you to place a substantial order with E plc. During your discussions, T suggested that you could qualify for a cash bonus in the event of an order being placed.
Which of the following is correct?
(i) Placing an order in these circumstances will place you in breach of your employment and professional obligations.
(ii) If the goods are what your company requires and are priced competitively, you are acting correctly in placing an order and qualifying for the cash bonus.
(iii) You have been placed in a conflict of interest situation and you should not proceed to place an order.

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

2. Rank the following, starting with the highest court:
(i) Court of Appeal (Civil)
(ii) Supreme Court
(iii) County Court
(iv) High Court

A) (i), (ii), (iv), (iii)
B) (i), (ii), (iii), (v)
C) (ii), (iv), (i), (iii)
D) (ii), (i), (iv), (iii)

3. Paschal has just passed his CIMA certificate exams and on doing so joined Un-Ethi-Cal Ltd for his first accountancy role.
Upon arrival he was been asked to do his company's corporation tax return, and not wanting to seem as if he was not keen in his first week, tells them he knows what to do and so goes online to find out how to do it.
He's got to go to a party that night, so although he can't work it out properly he fills in the form as best he can so he can get out on time.
Unfortunately, Paschal has breached CIMA's five fundamental ethical principles.
Which of the following has Paschal breached?
Select ALL that apply.

A) Objectivity + Confidentiality
B) Confidentiality + Professional competence and due care
C) Integrity + Professional competence and due core
D) Confidentiality + Professional competence and due care
E) Professional behaviour + Integrity
F) Integrity + Objectivity
G) Professional behaviour + Objectivity

4. Which of the following is correct?
i. In general a company can use its share capital for any reason whatsoever, as long as it ensures that there is sufficient remaining to meet the company's debts.
ii. A company must use its capital for lawful purposes.
iii. In general, a company cannot return its share capital to its members.

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

5. Which of the following does not apply to a private company which is about to declare a dividend?

A) There must be profits available for distribution as a dividend.
B) The company's net assets must equal the total of called up share capital plus un-distributable reserves.
C) The company must take account of accumulated realized losses.
D) The company must have accumulated realized profits.

Solutions: