Richard T De George | Ethical Issues for Accountants

question 92

Multiple Choice

Richard T. De George | Ethical Issues for Accountants
In this reading, De George looks at the inherent conflicts of interest built into the US system in which accounting firms work for and are paid by the companies that hire them. Because of the rule of confidentiality, accountants may find themselves caught between loyalty to their clients and ethical obligations to the public at large. De George suggests a tightening of the guidelines for accountants presented in their professional codes.
-If an accounting firm certifies a company's financial statements, it should have ___________ to make the firm's financial situation look better than it is.

• A) motivation
• B) a financial incentive
• C) no financial incentive
• D) an ethical intention

Appreciate the role of personality and cognitive tests in predicting job performance.

Explain the significance of various validity studies (concurrent, predictive) in ensuring effective selection systems.

Recognize how diversity and bias prevention measures (e.g., "name-blind" resumes) contribute to fair selection practices.

Understand the impact of selection decisions on organizational diversity and employee performance.

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Definitions:

FIFO

FIFO, or First-In, First-Out, is an inventory valuation method where goods first bought are the first to be sold, affecting cost of goods sold and inventory valuation on the balance sheet.

Revenues

The total amount of income generated by the sale of goods or services related to a company's primary operations.

FIFO

First-In, First-Out, an inventory valuation method where goods purchased or produced first are sold, used, or disposed of first.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, ending with the net income or loss for the period.