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This instructional quiz does not provide certification by Financial Executives International or any other body. The questions focus on financial reporting literacy and board governance as they relate to oversight of finance issues. It is not intended to be a test of the much legality imposed by being a director. See
(1) Livingston
Murdoch Group provides this quiz to heighten the awareness of director and audit committee responsibilities.
Quiz answers follow the 23 quiz questions.
1. Who is responsible for the proper preparation and presentation of the financial statements?
| a. |
Board of Directors
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| b. |
Management
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| c. |
External auditor
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| d. |
Audit Committee
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2. What is the purpose of private meetings between the audit committee and the auditors, both external and internal?
| a. |
Facilitate private evaluation of the CFO
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| b. |
Allow the auditors to express concerns to the committee without management present
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| c. |
All the audit committee to press the external auditors for lower fees
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| d. |
Reinforce the independence of the committee to management team
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3. Deferred taxes are:
| a. |
The unpaid portion of the company’s current tax bills
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| b. |
Taxes resulting from the difference between GAAP (book) income and taxable income
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| c. |
Tax obligations that arise solely from the implementation of tax shelter
vehicles |
| d. |
Taxes resulting from the difference between the GAAP and tax carrying amounts of the assets and liabilities
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Notes:
| (1) |
Quiz was prepared by Phillip Livingston, President and CEO of Financial Executives International with contributions from Roman Weil and John Stewart. Published by
H.S. Grace & Company, Inc. |
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