1. Which Statement is False ?

a)Smaller boards have a more informal culture.

b)The size of a corporation's board should be based on the skills needed to accomplish its responsibilities.

c)Director independence should not be viewed as a proxy for good governance.

d)A larger board is generally more effective than a smaller board, because of the variety of skills available.

e)All the statements listed are true.

2. Which of the following is not a responsibility of the audit committee?

a)Gain the input of outside experts when needed

b)Develop internal accounting controls

c)Select and appoint the external auditors and review the results of the audit

d)All of these are responsibilities of the audit committee

e)Review the internal audit department

f)Review the annual audit plan

3. The role of the Board of Directors is considered to be consistent and should not change based on a company's strategic challenges, or the challenges of the industry in which it operates.

True or False

4. The government is requiring about John's involvement in a criminal activity. Max, CPA obtained information when preparing John's tax return. John has not consented to the sharing of his information, so Max, CPA should not respond to the government order regarding this information because the information obtained when preparing John's tax return is confidential.

True or False

5. Match the term of "a to K" with the correct Description "1 to 11" :

a)Makes certain that the objectives of the entity are met while the legitimate needs and concerns of all shareholders are being addressed

b)The most commonly used framework to benchmark internal controls in the US

c)Created to protect investors and facilitate capital formation

d)Responsible for detecting and exposing questionable financial and accounting decisions

e)Establishes and articulates the corporate values, responsibilities, obligations, and ethical ambitions

f)The absence of any conflicts of interest through personal of professional ties with the corporation or its management

g)Brought the federal government into the regulation of the corporate governance for the first time

h)Assists the board in its oversight of the company's ethics policies

i)Enacted in 2002 as a result of accounting and financial misconduct

j)An independent, objective assurance and consulting activity designed to add value and improve an organization's operations

k)Recommends new candidates for the board of directors

1. Governance Committee

2. Audit Committee

3. Independence

4. The Accounting Reform and Investor Protection Act (SOX)

5. The stock market crash of 1929

6. Gatekeepers

7. Internal Auditing

8. The SEC

9. COSO

10. Corporate Governance

11. Code of Ethics