BFA302

1. 1According to Lindblom (1994), which of the following strategies can an organisation adopt when it perceives that its legitimacy is in question because its actions or operations are at variance with society's expectations and values?

   1. AA. Seek to educate and inform its 'relevant public' about actual changes in the organisation's performance and activities
   2. BB. Seek to change the perceptions that 'relevant public' have of the organisation's performance and activities
   3. CC. Seek to manipulate perception by deflecting attention from the issue of concern onto other issues to demonstrate how the organisation has fulfilled social expectations
   4. DD. All of the given options are correct
2. 2Normative accounting theories and research seek to:

   1. AA. Explain and predict particular phenomena based on observation
   2. BB. Prescribe particular approaches not driven by existing practices
   3. CC. Describe what is normal, and generally accepted practice
   4. DD. All of the given options are correct.
3. 3The difference between the managerial and moral perspectives of Stakeholder Theory is that:

   1. AA. The moral perspective is empirically testable
   2. BB. The moral perspective is more 'organisation-centred'
   3. CC. The managerial perspective is empirically testable
   4. DD. The managerial perspective holds that all stakeholders have certain minimum rights that must not be violated
4. 4Which of the following is not assumed in Positive Accounting Theory?

   1. AA. Individuals (including managers) are economically rational in their behaviour.
   2. BB. Individuals (including managers) are primarily motivated by self-interest.
   3. CC. The natural objective of managers is to maximise the wealth of the firm.
   4. DD. Managers are not indifferent in selecting accounting methods to use.
5. 5A theory is:

   1. AA. A proposed explanation of a phenomenon which still has to be rigorously tested
   2. BB. A scheme or system of ideas or statements or propositions which has undergone extensive testing and is generally accepted to be the accurate explanation behind an observation
   3. CC. A provisionally accepted hypothesis proposed for further research
   4. DD. None of the given options are correct
6. 6The 'bonus plan hypothesis' of Positive Accounting Theory suggests managers of firms with bonus plans tied to reported income are more likely to use accounting methods that:

   1. AA. Increase prior period reported income
   2. BB. Increase current period reported income
   3. CC. Increase future period reported income
   4. DD. None of the given options are correct
7. 7The 'legitimacy gap' of a corporation will narrow when

   1. AA. A corporation discloses good news about its behaviour but its actual behaviour declines
   2. BB. A corporation discloses bad news about its behaviour but its actual behaviour improves
   3. CC. Societal expectations of appropriate corporate behaviour increase
   4. DD. None of the given options are correct
8. 8What is the minimum level of accounting knowledge that readers of financial statements are assumed to possess, according to most professional accounting bodies around the world?

   1. AA. None
   2. BB. A level of knowledge sufficient to understand the financial reports properly
   3. CC. A sound working knowledge
   4. DD. An expert level of knowledge
9. 9The moral perspective of Stakeholder Theory holds that all stakeholders have the right to be treated fairly by an organisation

   1. AA. Provided this improves the organisation's financial performance
   2. BB. Regardless of the impact on the organisation's financial performance
   3. CC. Because, in the long run, this will improve the organisation's financial performance
   4. DD. None of the given options are correct
10. 10Based on a joint consideration of Media Agenda Setting Theory and Legitimacy Theory, which of the following statements is correct?

    1. AA. According to Legitimacy Theory management uses the annual report as a tool to legitimise the ongoing operations of the organisation, and according to Media Agenda Setting Theory the media are able to influence community perceptions about issues such as the environment
    2. BB. Community concerns about the environmental performance of a specific firm in an industry will also impact on the disclosure strategies of firms across that industry
    3. CC. We should find a relationship between the extent of disclosure of social and environmental issues within the annual report and the media attention given to those issues
    4. DD. All of the given options are correct

11. 11It is commonly asserted that businesses should be sustainable because

    1. AA. The interests of business, society and the environment are aligned in the medium term
    2. BB. The interests of business, society and the environment are aligned in the long term
    3. CC. The interests of business, society and the environment are aligned in the short term
    4. DD. All of the given options are correct
12. 12Which of the following is not a reason why traditional financial accounting may be unable to reflect the social and environmental impact of organisations?

    1. AA. Externalities are difficult to measure
    2. BB. Traditional financial accounting typically discounts future liabilities to present value
    3. CC. Accountants are unable to understand the social and environmental impacts of an organisation
    4. DD. Traditional financial accounting adopts the 'entity assumption'
13. 13The Global Reporting Initiative Guidelines are:

    1. AA. A mandatory framework containing a list of organisational financial, social and environmental performance indicators
    2. BB. A mandatory framework containing a list of governmental financial, social and environmental performance indicators
    3. CC. A voluntary framework containing a list of organisational financial, social and environmental performance indicators
    4. DD. A voluntary framework containing a list of governmental financial, social and environmental performance indicators
14. 14Stakeholder engagement process involves

    1. AA. Discovering what really matters to the key stakeholders
    2. BB. Monitoring and managing stakeholder contributions and satisfaction levels
    3. CC. Providing them with feedback on corporate strategies and performance, and identifying what and how things can be changed
    4. DD. All of the given options are correct
15. 15Critical accounting researchers have criticised other social and environmental accounting researchers for

    1. AA. Lacking objectivity
    2. BB. Being too radical and unrealistic
    3. CC. Leaving existing social structures unchallenged
    4. DD. Ignoring the findings of empirical accounting research
16. 16Critical researchers believe that most accounting research:

    1. AA. Supports the prevailing political ideology
    2. BB. Challenges the prevailing political ideology
    3. CC. Examines the prevailing political ideology
    4. DD. Brackets the prevailing political ideology
17. 17Efficiency perspective can be described as:

    1. AA. All individuals' action is driven by self-interest
    2. BB. Individuals will act in an opportunistic manner to the extent that the actions will increase their wealth
    3. CC. Notions of loyalty and morality are ignored
    4. DD. Different organisational characteristics explain why different firms adopt different accounting methods
18. 18The qualitative characteristics of financial reports that make information useful to users are:

    1. AA. Understandability
    2. BB. Reliability
    3. CC. Comparability
    4. DD. Understandability, reliability and comparability
19. 19Which of the following is true regarding the role of professional judgment in financial reporting?

    1. AA. Accountants are always subjective in their judgments
    2. BB. Information generated should faithfully represent transactions and be neutral and verifiable
    3. CC. The consideration of economic and social standards implies objectivity in their development and implementation.
    4. DD. Accountants are never required to apply professional judgment
20. 20Which of the following statements shows that Adam Smith advocated a regulatory approach?

    1. AA. Without regulatory involvement, productive resources will find their way to the most productive uses.
    2. BB. Leaving activities to the control of market mechanisms will protect market participants
    3. CC. The government needs to be involved in the 'public interest' to protect the more vulnerable
    4. DD. None of the given options are correct
21. 21One criticism of Positive Accounting Theory is that it tells us nothing about:

    1. AA. Whether the practice or method being used is the most efficient
    2. BB. Whether the practice or method being used is the most equitable
    3. CC. Which method a firm should use
    4. DD. All of the given options are correct
22. 22In evaluating various research studies, it is important to first consider:

    1. AA. The logic of the argument and how it is tested
    2. BB. The logic of the argument and the assumptions on which it is based
    3. CC. The purpose of the study and the type of theory on which it is based
    4. DD. Whether the data collected represents a valid measure of the theoretical variables in question
23. 23A theory is:

    1. AA. A proposed explanation of a phenomenon which still has to be rigorously tested
    2. BB. A scheme or system of ideas or statements or propositions which has undergone extensive testing and is generally accepted to be the accurate explanation behind an observation
    3. CC. A provisionally accepted hypothesis proposed for further research
    4. DD. None of the given options are correct
24. 24Which of the following statements is true about accounting measurements such as profits and assets?

    1. AA. They are subject to professional judgment
    2. BB. They would not vary if prepared by different accountants, providing they were based on the same set of accounting standards
    3. CC. They are based on hard, objective, evidence
    4. DD. All of the given options are correct
25. 25Which of the following is not an argument for regulation?

    1. AMarkets for information are not efficient, and therefore produce a sub-optimum amount of information given the problem of 'free riders'.
    2. BThe capital market is efficient, but only 'on average'
    3. CCapital markets require information, and therefore firms that do not supply it will be punished
    4. DInformation asymmetry exists, because not everyone has the same power over resources to obtain the information they need
26. 26Which of the following is a reason why accounting, and accountants, can be considered very powerful?

    1. AA. The emphasis on profitability measures provides support to profitable companies which may not be worthy of support under other measures
    2. BB. The provision of purported objective information provides users with a source of power to drive changes to a corporation's behaviour
    3. CC. The output of the accounting process impacts on many decisions which can result in transfers of funds, and therefore wealth
    4. DD. All of the given options are correct
27. 27Efficiency perspective can be described as:

    1. AAll individuals' action is driven by self-interest
    2. BIndividuals will act in an opportunistic manner to the extent that the actions will increase their wealth
    3. CNotions of loyalty and morality are ignored
    4. DDifferent organisational characteristics explain why different firms adopt different accounting methods
28. 28Which of the following propositions is not true if we accept the notion that accounting regulation is considered to be the output of a political process?

    1. AFinancial accounting is objective, neutral and apolitical
    2. BStandard-setting bodies encourage affected parties to make submissions on draft versions of the proposed accounting standards
    3. CMany decisions that are made are the outcome of compromise
    4. DIf the social welfare impact of accounting policies were ignored, the basis for the existence of a regulatory body would disappear
29. 29Which of the following statements shows that Adam Smith advocated a regulatory approach?

    1. AE. Without regulatory involvement, productive resources will find their way to the most productive uses.
    2. BF. Leaving activities to the control of market mechanisms will protect market participants
    3. CG. The government needs to be involved in the 'public interest' to protect the more vulnerable
    4. DH. None of the given options are correct
30. 30According to Violet (1983), accounting cannot be considered to be culture-free. Which of the following does not explain what Violet means by this?

    1. AA. Accounting is a social institution and, as such, has integrated certain cultural customs and elements within it.
    2. BB. Accounting is an independent component of culture
    3. CC. Accounting is a product of culture, and contributes to the evolution of the culture which employs it.
    4. DD. Since accounting is culturally determined, other cultural customs, beliefs and institutions influence it
31. 31Hofstede (1980) defined culture as:

    1. AAn expression of norms, values and customs which reflect typical behavioural aspects
    2. BA system of individual values, customs and beliefs
    3. CThe collective programming of the mind, which distinguishes the members of one human group from another
    4. DA system of societal or collectively-held values
32. 32From a practical standpoint, what is the goal of accounting standards harmonisation or convergence?

    1. ACreating one set of standards used throughout the world
    2. BReducing the conflict among national accounting standards
    3. CProducing accounting standards that are unique for each country
    4. DForcing compliance with IASB regulations
33. 33What is the purpose of developing a conceptual framework?

    1. ATo provide a coherent structure to accounting practice which had developed in an ad hoc way
    2. BTo guide standard-setters to develop standards based on the same concepts and principles, rather than in a piecemeal approach
    3. CTo guide users where there is no accounting standard covering an issue
    4. DAll of the given options are correct
34. 34On what criteria is a 'reporting entity', as defined in International Framework, dependent?

    1. AWhether there are users that are dependent on the reports to make or evaluate resource decisions
    2. BProfessional judgment providing some guidelines to help make a decision
    3. CWhether there are users that are dependent on the reports to make or evaluate resource decisions, and professional judgement provides some guidelines to help make a decision
    4. DThe Corporations Law based on measures of gross revenue, dollar value of assets and the number of employees
35. 35What does the political legitimacy argument, as outlined by Hines (1991), suggest?

    1. AThe accounting profession consists of experts in technical knowledge of accounting and should therefore be given authority to regulate accounting
    2. BThe accounting profession used the development of the conceptual framework as a strategy to promote their self-regulation interests
    3. CThe conceptual framework provides the authority to resolve technical issues with authority and legitimacy
    4. DAs users are politically involved in developing the conceptual framework, the outcome has political legitimacy
36. 36Factors that may indicate a reporting entity include:

    1. AA. Separation of management from those with an economic interest in the entity
    2. BB. The economic or political importance/influence of the entity to/on other parties
    3. CC. The financial characteristics of the entity
    4. DD. All of the given options are correct
37. 37Which of the following is a central assumption of Positive Accounting Theory?

    1. AIndividuals act solely on the basis of self-interest
    2. BFirms seek to maximise profits
    3. CThe interests of principals and agents are not aligned
    4. DFinancial statements will be audited regardless of legal requirements
38. 38Which of the following statements is false?

    1. AA. Legitimacy Theory is derived from 'classical' political economy theory
    2. BB. Legitimacy Theory suggests that organisations will act in a way that society perceives as legitimate
    3. CC. Legitimacy Theory relies upon the notion of the 'social contract'
    4. DD. Legitimacy Theory asserts that organisations will attempt to ensure that society perceives their actions as 'legitimate'
39. 39The 'political cost hypothesis' of Positive Accounting Theory suggests which of the following?

    1. AA. Large firms are more likely to use accounting choices that reduce reported profits
    2. BB. Small firms are more likely to use accounting choices that reduce reported profits
    3. CC. Neither large nor small firms are more likely to use accounting choices that reduce reported profits
    4. DD. Both large and small firms are more likely to use accounting choices that reduce reported profits

Descripción

Test sobre BFA302, creado por Ariana Brunssen el 17/10/2019.

Autor

Ariana Brunssen

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English

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Creado el 17 oct 2019 · actualizado el 29 oct 2019

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