business ethics

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yhliuaa
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290687
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business ethics
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2014-12-06 02:49:57
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business ethics
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business ethics
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  1. Duties of auditors

    5

  2. Resignation of auditors

    3

  3. Removal of auditors

    2

  4. Objectivity principles

    3

  5. Mr. Yim and Mr. Ng and Mr. Wong are the shareholders of American Polyester Fabric Ltd. They hold 40%, 50% and 10% respectively of the shares in the company. The shares are all of equal rights. The articles of the company contain an article which reads that “A declaration of dividend shall be made by the company in general meeting”. Mr. Yim and Mr. Ng are the only directors of the company. In a board meeting, they decided that they would be paid a dividend of $1 per share but Mr. Wong would not be paid any dividend. Their recommendation was approved in general meeting because they as the majority shareholders voted for the recommendation in the meeting. Mr. Wong felt aggrieved by the resolution of the general meeting. Discuss whether the rights of Mr. Wong as a shareholder of the company has been deprived of and advise Mr. Wong of any remedies available to him.
    3
  6. Venture Ltd is a company whose main objects are property development and the leasing of residential and commercial property. The company’s articles are in the form of Table A. The share capital is made up of $5,000,000 of ordinary shares of which $3,000,000 is held by Jack and Jill (who are directors of the company) with the remaining shares held by various investors including $100,000 by Jones. The other remaining shareholders are business associates of Jack and Jill who vote as instructed by Jack and Jill.It has come to light that in 1997 when the company was pursuing negotiations to purchase a number of flats in Kwai Chung, Jack and Jill purchased one of the flats themselves jointly which they have now sold for a handsome profit to a property investor. It has also further come to light that a piece of land that the company had in general meeting resolved to sell in 1996 to Jack and Jill. It turns out that because of a mistake in assessing the value of the land, the land was sold at a gross undervalue. Jack and Jill have now sold to other developers at some 2 times the price they paid. Jones is now concerned with bringing proceedings against Jack and Jill to recover the secret profits in relation to the purchase and resale of the property. Jones is also concerned with the sale of the company’s land to Jack and Jill at an undervalue, as he believes there was a loss to his shareholding. Advise Jones.
    • principle:1
    • application: 6
  7. NorthCee have been an audit client for five years and you have been audit manager for the past three years while the audit partner has remained unchanged. You are now planning the audit for the year ending 31 December 2013. Following an initial meeting with the directors of NorthCee, you have obtained the following information. (i) to be listed, not yet public info (ii) you are prepare Northcee's financial statements (iii) evening reception (iv) deferred payment for service rendered, will pay after tax authority approve tax application (v)inherited about 5% of NorthCee’s share(vi)university friends(vii)also consult NorthCee, WHAT FACTORS THREATEN INDEPEDENCE OF AUDITOR?

    8

  8. NorthCee have been an audit client for five years and you have been audit manager for the past three years while the audit partner has remained unchanged. You are now planning the audit for the year ending 31 December 2013. Following an initial meeting with the directors of NorthCee, you have obtained the following information. (i) to be listed, not yet public info (ii) you are prepare Northcee's financial statements (iii) evening reception (iv) deferred payment for service rendered (v)inherited about 5% of NorthCee’s share, WHAT MUST NORTHCEE DO TO MEET CORPORATE GOVERNANCE REQUIREMENT

    5

  9. why auditor independence is necessary?

    increase credibility of auditting and reliability of audit report

  10. Cash required Greed to (1)complete the audit within one week so that I-Toys Ltd could submit the audited financial statements to a bank as part of a loan application. (2)Mr. Cash agreed to pay Mr. Greed a fixed fee plus a bonus if the bank granted the loan. (3)Mr. Greed hired two accounting students on a part-time basis to conduct the audit. (4)Mr. Greed instructed them not to spend time reviewing the internal controls but to focus on tying the account balances to the trial balance and to prepare a set of financial statements with notes to the accounts. (5)After one week, Mr. Greed reviewed the set of financial statements drafted by the part-time staff and an unqualified auditor’s report was issued thereon. Indicate and explain the actions of Mr. Greed resulting in a failure to comply with professional ethics.
    5
  11. control of the company
    5
  12. powers to be exercised by members on GM
    6
  13. rights of individual shareholders
    3
  14. legal principles of foss v harbottle
    9
  15. statutory protection of the minority
    6

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