a. less than 50.
b. between 50 and 75.
c. between 100 and 120.
*d. more than 120.
Correct answer: d
Learning Objective 1.5 ~ Discuss the globalisation of financial reporting
Which statement is correct?
The use of one set of accounting standards by companies throughout the world:
makes it more difficult for comparability and transparency of financial information.
leads to inefficiency in lending markets.
reduces the cost of preparing financial reports.
reduces the quality of information provided to capital market participants.
Correct answer: c
Learning Objective 1.5 ~ Discuss the globalisation of financial reporting
Companies operating in Australia and overseas must follow which accounting standards?
*a. Both IFRS and local GAAP.
b. Local generally accepted accounting principles only.
c. IFRS only.
d. FASB.
Correct answer: a
Learning Objective 1.5 ~ Discuss the globalisation of financial reporting
The Corporations Act 2001 is primarily enforced by the:
a. Financial Reporting Council.
b. Australian Securities Exchange.
c. Australian Accounting Standards Board.
*d. Australian Securities and Investments Commission.
Correct answer: d
Learning Objective 1.6 ~ Identify the sources of company regulation in Australia
Legally enforceable accounting standards that apply to Australian companies are issued by the:
a. Financial Reporting Council.
*b Australian Accounting Standards Board.
c. Australian Professional Accounting bodies.
d. Australian Securities and Investments Commission.
Correct answer: b
Learning Objective 1.6 ~ Identify the sources of company regulation in Australia
Which of the following is not a role of the Australian Securities and Investments Commission?
*a. To ensure financial institutions honour their commitments.
b. To uphold the law uniformly, effectively and quickly.
c. To promote confident and informed participation in the financial system by investors and consumers.
d. To make information about companies and other bodies available to the public.
Correct answer: a
Learning Objective 1.6 ~ Identify the sources of company regulation in Australia
The regulatory body that oversees the operations of financial institutions such as banks and building societies in Australia is:
a. ASIC.
b. ASX.
c. ATO.
*d. APRA.
Correct answer: d
Learning Objective 1.6 ~ Identify the sources of company regulation in Australia
The ACCC is responsible for:
a. enforcement of the Corporations Act 2001.
b. the stability of the Australian financial system.
*c. administration of the Competition and Consumer Act 2010.
d. the ASX Market and Listing Rules.
Correct answer: c
Learning Objective 1.6 ~ Identify the sources of company regulation in Australia
The ICAA and CPA Australia:
a. are responsible for developing company regulations.
b. play no role in setting company regulation and have nothing to do with enforcing company regulation.
c. have nothing to do with setting company regulations but have a role in enforcing the regulations.
*d. are involved in the enforcement of company regulations through the regulation of their members.
Correct answer: d
Learning Objective 1.7 ~ Explain the current standard-setting framework and the role of the professional accounting associations in the standard-setting process
The Financial Reporting Council is responsible for:
*a. overseeing the accounting and auditing standard-setting process for both the public and private sectors in Australia.
b. developing Australian accounting standards for both the public and private sectors in Australia.
c. issuing Australian accounting standards for both the public and private sectors in Australia.
d. reporting breeches of Australian accounting standards for both the public and private sectors in Australia.