Business Ethics Graded Exam #4

The importance of the need for firms to be ahead of the sustainability curve is underlined by which among the following reasons for businesses to pursue the strategy of sustainability?

Competitive advantages exist for sustainable businesses.

Which among the following elements of COSO comprises of policies and procedures that support the control environment?

Control activities

According to Daly, over the long term, resources and energy cannot be used, nor waste produced, at rates which the biosphere cannot replace or absorb them without harming its ability to sustain life. This is termed as

biophysical limits to growth.

Under the aegis of the Sarbanes-Oxley Act and COSO control environment, the internal audit and compliance professionals are also becoming more accountable for financial stewardship, resulting in all of the following except

greater loyalty.

Estimates suggesting that with present technologies, businesses can readily achieve at least a fourfold increase in efficiency, and perhaps as much as a tenfold increase. This can be achieved through

ecoefficiency.

According to the sustainable model, entropy increased within a closed space implies that

the amount of usable energy decreases over time.

Changes within the accounting industry arising from the consolidation of major firms and _____ of services such as consulting within single firms have virtually institutionalized conflicts of interest.

cross-selling

The three goals of sustainable development that include economic, environmental, and ethical sustainability are referred to as the

three pillars of sustainability.

Advertising is a $200 billion a year industry in the United States alone. What does this prove?

Business can influence consumer choice.

All of the following are characteristics of the circular flow model except

that the economy is not a solution to all social ills and is finite in its ability to grow.

The approach that animals with a central nervous system feel pain is akin to the _____ ethical framework which asserts an ethical responsibility to minimize pain.

utilitarian

In economic terms, all resources are infinite. Why?

Since all resources can be replaced by substitutes, i.e., they are 'fungible'.

One aspect of the circular flow model does not differentiate natural resources from other factors of production. Thus it

does not explain the origin of resources.

Which among the following entails an incentive to redesign products so that they can be recycled efficiently and easily?

Cradle-to-cradle responsibility

Which among the following duties of board members underlines the fact that directors of a company need not actually be an expert or run the company?

Duty of care

All of the following are characteristics of a market approach to environmental responsibilities except

the businesses develop a compliance structure ensuring conformation to certain regulations.

Markets can work to prevent harm only through information supplied by the existence of market failures. This is termed

first-generation problem.

Which among the following is responsible for influencing the control consciousness of its people under the elements of COSO?

Control environment

In order for the board to assess their success according to FSG standards, all of the following are necessities except

the evaluation of their personal annual financial statements.

When professionals have a professional and ethical obligation to their clients, duties that override their own personal interests, they are said to have

fiduciary duties.

According to Daly, the emphasis of economic growth as the goal of economic policy will inevitably fail unless it is realized that

the economy is a subsystem within earth's biosphere.

Which among the following evaluate a company's financial prospects or creditworthiness, so that banks and investors can make informed decisions?

Analysts

The Enterprise Risk Management - Integrated Framework, expands on the prior framework in that it intentionally includes "_____" as one of its interrelated components.

objective setting

The events that led to Enron's demise brought into focus the necessity of the _____ and the responsibility of auditors as never before.

independence of auditors

The _____ relies on the judgment of accounting professionals in carrying out their duties rather than stipulating specific rules.

AICPA Code of Professional Conduct

According to the Federal Sentencing Guidelines, the board must, in particular, work with executives to analyze the

incentives for ethical behavior.

The _____ sees environmental responsibilities as a fundamental part of basic business practice.

sustainability paradigm

From the perspective of _____, structural changes including the provision of legal protection or sanction to shield professionals from conflicts of interest would be an appropriate response to the accounting scandals of recent years.

social ethics

According to William Baxter, society, through the activities of individuals, will be willing to pay for an 'optimal level of pollution' as long as the _____ outweigh the final costs.

perceived benefits

The interrelatedness of natural systems has helped mankind understand the wide range of dependence on ecosystems. This fact has increased the importance of

self-interested reasoning.

Which among the following are responsible for ensuring that decisions and transactions conform to the law?

Board of directors

Management assessment of internal controls is an aspect of which among the following provisions of the Sarbanes-Oxley Act that has significantly impacted corporate governance and boards?

Section 404

The COSO standards for internal controls shifted audit, compliance, and governance from a _____ to concern for the organizational environment.

numbers orientation

All of these functions can assume the roles of a gatekeeper except

engineers.

Many analysts contend that the rampant corruption in financial institutions is evidence of a complete failure

in the corporate governance structure.

According to Bill George, which among the following tenets ensuring appropriate and ethical governance by the board encourages the perseverance of authenticity and credibility of the board's communications?

Executive sessions

All of the following are inadequacies associated with Norman Bowie's view of corporate social and environmental responsibility except that

it contends that environmental protection will extend further than legal jurisdictions.

The second line in The Natural Step's funnel represents

aggregate worldwide demand.

A survey has reported that more than half the firms believe that _____ gives investors and other stakeholders more confidence in their financial reports.

Section 404

Knowing what the future might be; creative businesses _____ the present and determine what must be done to arrive to that future.

backwards to