What Caused the U

question 5

Multiple Choice

What caused the U.S. Congress, the OECD, the International Federation of Accountants, and other organizations to enact stricter rules on corporate governance in recent years?

• A) Sudden increase in world trade
• B) High-profile corporate scandals
• C) Significant decline in world trade
• D) Expansion of the European Union membership

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Definitions:

Equity Method

An accounting technique used to assess the profits earned by investments in other companies, where the investment income is proportional to the ownership stake.

Common Stock

A type of equity security that represents ownership in a corporation, with holders entitled to vote on corporate matters and receive dividends.

Noncontrolling Interest

The equity in a subsidiary not attributable, directly or indirectly, to a parent company.

Equity Method

The Equity Method is an accounting technique used by firms to assess the profits earned through their investments in other companies, recording these profits as income from the investment.