Professional accountancy and corporate governance

1. The objective of the accountancy profession can best be described as:

• A. Providing financial information about an entity to external users, which is useful to them in making economic decisions and for assessing the stewardship of the entity’s management
• B. Measurement, disclosure or provision of assurance about financial information that helps managers, investors, tax authorities and other decision makers make resource allocation decisions
• C. Identifying, measuring, accumulating, analysing, preparing, interpreting and communicating information used by management to plan, evaluate and control an entity and to assure appropriate use of and accountability for its resources
• D. Managing all the processes associated with the raising and use of financial resources in a business

2. Which of the following element is least likely to characterise a profession?

• A. Restrictions on membership to ensure the skill and competence of members
• B. A high degree of autonomy and independence
• C. Core values are established which members are expected to maintain
• D. The profession’s rules and regulations are established solely by government legislation

3. Professions often set out codes of ethics and conduct. These are an example of which common attribute of professions?

• A. Professional values
• B. Self-regulation
• C. Co-regulation
• D. Formal regulatory process

5. Paula recently established her own accountancy practice from small retail premises in Hightown. She operates as a sole trader. Paula passed the last of her ICAEW examinations last month although she is not yet permitted to offer statutory audit, insolvency, investment business or probate services. She has already been successful in attracting several clients to her new practice. She has not yet become a member of ICAEW but she is registered with an approved body for supervision under the money laundering regulations. Which of the following statements is correct?

• A. Paula cannot call herself an accountant.
• B. ICAEW can legally stop Paula from practising as a sole trader.
• C. Paula can offer any accountancy services she considers appropriate.
• D. Paula can offer any accountancy services except those in the reserved areas

7. Upholding professional ethics is a key part of being a professional accountant. Which of the following duties of an accountant only applies to those employed in the public sector?

• A. Protect the public interest
• B. Apply laws and regulations
• C. Protect the profession’s reputation and standing
• D. Protect taxpayers’ money

12. Who is responsible for supervising member firms of the ICAEW in respect of anti-money laundering?

• A. The Financial Conduct Authority (FCA)
• B. The ICAEW
• C. The Office of Professional Body AML Supervision (OPBAS)
• D. HMRC

2. The chair of Raygold plc is considering which of the company’s non-executive directors can be classified as independent. They may be classified as independent if the period of employment finished at least:

• A. two years ago
• B. three years ago
• C. four years ago
• D. five years ago

4. According to the UK Corporate Governance Code, a company should seek to improve governance by ensuring that:

• A. the chair and chief executive are the same individual
• B. the chair and chief executive are different individuals
• C. the chair and chief executive are different individuals in case of incapacity
• D. the company chairman does not take up outside directorships

11. Directors are expected to report in the annual financial statements on:

• A. the going concern status of the company
• B. the materiality of specific transactions
• C. the accruals approach to accounting
• D. the consistency of treatment of particular items

12. Hilditch plc is creating a list of potential members of its audit committee. Under the Code, the list must comprise only:

• A. independent non-executive directors with recent and relevant financial experience
• B. independent non-executive directors with at least one who has relevant experience
• C. non-executive directors with relevant financial experience
• D. executive directors with relevant financial experience