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

1. Which of the following would be paid last by a company which had been placed in insolvent liquidation?

A) Fees owed to the directors
B) Unpaid employees' wages
C) Share capital invested by the shareholders.
D) Outstanding loan capital and interest due to the holder of an unsecured debenture.

2. Y has an opening at his company for a trainee accountant. His nephew is just about to leave school, and Y receives a call from his sister suggesting that her son should get the job. Y's firm has a strict policy with regards to the employment of family members, especially in finance departments. But for Y, looking after his family is very important, and he is sure he will be an excellent staff member. Y has an ethical dilemma because there is tension between:

A) His professional and corporate values
B) His personal and professional values
C) His personal and societal values
D) His personal and corporate values

3. Which of the following cases of dismissal are likely to be deemed automatically fair by an employment tribunal?

A) Tom - A 75-year-old firefighter whose boss made him retire because of the physical nature of the job.
B) Nigel - A security guard who had been dismissed for drinking on the job.
C) Sara - An accountant who was dismissed for lying about her qualifications during her initial interview.
D) Bob - An employee at a biscuit factory who was dismissed because the company they worked for wanted to save money despite having no debts.
E) Anita - An employee at an IT firm who was dismissed by her boss because she is a graduate who doesn't have much experience.

4. Which of the following is correct in relation to damages?
(i) As a general rule damages for breach of contract are designed to place the innocent party in the position that he or she would have been in had the contract been carried out properly.
(ii) Damages are only available for breach of contract, if the breach caused the loss.
(iii) Damages are only available for losses arising naturally from the breach.

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

5. To which of the following contracts does the Supply of Goods and Services Act 1982 apply?
(i) A contract with a joiner for the manufacture and supply of a cabinet.
(ii) A contract for the hire of a car.
(iii) A contract with a builder to construct an extension to a house.

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

Solutions: