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LOS a, (Part 2): Discuss the objectives and the core attributes of an effective corporate governance system, and evaluate whether a company’s corporate governance has those attributes.
Q1. In a presentation to a group of students in an Executive MBA class, Professor Steven Dawes tells the class that corporate governance systems will tend to differ based on the legal environment, culture an industry in which a firm operates, however, all corporate governance systems share certain common attributes. Dawes continues on to make two statements:
Statement 1: All corporate governance systems will define the rights of shareholders and other important stakeholders.
Statement 2: All corporate governance systems should be implemented by individuals with no potential conflicts of interest with company management or shareholders.
Which of Dawes’ statements are consistent with the core attributes of an effective corporate governance system?
A) Statement 1 is consistent, Statement 2 is inconsistent.
B) Statement 1 is inconsistent, but Statement 2 is consistent.
C) Both Statement 1 and Statement 2 are consistent.
Q2. Mitchell Cash is a corporate governance consultant for Yost and Karl Consulting. In a presentation to a prospective new client, Cash states that an effective corporate governance system will:
- Provide for fair and equitable treatment in all dealings between managers, directors, and shareholders.
- Have complete transparency and accuracy in all disclosures regarding operations, performance, risk, and financial systems.
Which of the following is a core attribute of effective corporate governance systems that Cash left out of his presentation?
A) Legal and regulatory requirements are complied with fully and in a timely fashion.
B) Clearly defined manager and director governance responsibilities to stakeholders.
C) Chief officers of a corporation are legally authorized to enter into contracts on behalf of the business.
Q3. All of the following are attributes of an effective corporate governance system EXCEPT:
A) executive compensation is not excessive in comparison with other industry firms.
B) have complete transparency and accuracy in disclosures regarding operations, performance, risk, and financial position.
C) provide for fair and equitable treatment in all dealings between managers, directors, and shareholders.
Q4. The main objectives of a corporate governance system are best described as to:
A) eliminate or reduce conflicts of interest, and to use the company’s assets in a manner consistent with the stakeholders’ best interests.
B) define the rights of shareholders, and to facilitate fair and equal treatment in dealings between management and other stakeholders.
C) facilitate open communication between management and stakeholders, and to most effectively utilize corporate assets.
Q5. Most corporate governance systems focus on the elimination or reduction of any potential conflicts that may arise between management and:
A) directors.
B) employees.
C) shareholders.
Q6. In general, a corporate governance system will NOT strive to manage a potential conflict of interest that may arise between management and which of the following groups?
A) Auditors.
B) Creditors.
C) Employees.
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发表于 2009-3-3 14:22
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