EarlCrown10383
Please Help me answer the folowing questions 1. Ethics…
Please Help me answer the folowing questions
1. Ethics may be defined as the systematic study of standards of human conduct and moral judgment. Please select below that involves ethical issue.
Paying the right taxes to the government.
Adherence to the traffic rules.
Adherence to the minimum wage law.
Conflict of interest.
Does all ethics issue have the consequence of tort?
True
False
Which of the following below is not the corporate social responsibility?
Payment of damages to a customer who was injured by the company’s defective product.
Clean up of pollution spill made by the company.
Giving permission to Red Cross to conduct a blood bank on the company’s premises.
Labour exploitation and sexual harassment.
Mr. Warren, the chief executive of ABC Ltd., negotiates a contract to buy an equipment from CB Inc. for $2.0 million. The bylaws of ABC Ltd. provide that any contract involving expenditure of more $50,000.00 must be approved by the parent company. The approval was not obtained and Mr. Warren acting outside the scope of his actual authority. CB Inc. is aware of the existing bylaws and authority of Mr. Warren. Can CB enforce the contract?
True
False
In corporate structure, the power of the board of directors (BOD) emanates from the shareholders. Also, the power of the officers who were appointed by the directors emanates from the shareholders.
True
False
The directors and officers of the corporation owed a fiduciary duty, as well as duty of care, diligence and skill to the shareholders.
True
False
A moralist is almost always an ethicist but not all ethicists are moralist.
True
False
An individual, regardless of their residential status, has always moral and ethical responsibilities to the society with regard to its dealing, while a corporate citizen owes no corporate social responsibility.
True
False
In a contract, ethics always plays a core role from conception to consummation of the contract.
True
False
____________ often cited as the father of corporate social responsibility (CSR) who connects the responsibility of the corporation to society.
Howard Bowen
Thomas Hobbes
Roscoe Pound
Karl Marx
____________ refers to business self-regulated with the aim of being socially accountable like improving the working conditions, reducing carbon footprints and participating in fairtrade.
Business ethics
Corporate social responsibility
A & B
None of the above
Below are examples of corporate social responsibility, except?
Engaging in charity work.
Getting involved in volunteer work.
Improving labour policies.
Business merger.
Business ethics refers to the moral principles and standards that guide company’s behaviour while corporate social responsibility is an integrative management concept that established responsible behaviour of the company towards the society.
True
False
In general, in the absence of law that regulates specific performance of a company like compliance of Workers Compensation Board (WCB) policy, does business ethics are sufficient guidelines for a business to perform its moral obligation as a responsible corporate citizen?
True
False
In general, and except for financial institutions such as bank and insurance companies, there are no minimum issued capital requirements for corporation, and legally, a corporation may carry on business with a share capital of $1.00.
True
False
________________ prohibits corporation from payment of dividends, redemption or repurchase of shares by the corporation from its shareholders when the corporation is insolvent or doing either of these instances would have the effect of making the corporation insolvent.
Maintenance of capital test.
Test of insolvency
The corporation business activities affect many external groups or stakeholders, and these stakeholders include the corporation creditors, employees, consumers, competitors, potential public investors and the public at large. Solvency test and maintenance capital test are examples of corporate business responsibility for protecting creditors’ investment.
True
False
In the corporate structure, the power originates with the general meeting of _________________ who elect the set of board of directors (BOD) to manage the corporation. Please select one from the choices below.
President & Chief Executive Officer
Shareholders
Board of Directors
Audit committee
Does a corporate social responsibility (CSR) is an added cost to the company?
True
False
A company who practices strong business ethics keeps its business within the parameters of the law, and it can also serve to build goodwill and brand equity.
True
False
Which of the following below the effect of non-compliance of corporate social responsibility?
Fines and penalties.
Damage image and reputation
A & B
None of the above
Below are some of the benefits of having a strong corporate social responsibility (CSR) for a business, except?
Increase investment opportunities.
Guaranteed salary increases every year.
Increase employee engagement.
Increase customer retention and loyalty.
According to the Supreme Court of Canada, there are three identified characteristics of fiduciary relationship. Please select that applies.
The fiduciary (often a professional) has undertaken to act in the best interests of the beneficiary (often the client)
The beneficiary is vulnerable to or at the mercy of the fiduciary’s control or discretion.
A legal or practical interest of the beneficiary could be harmed by the beneficiary’s exercise of discretion or control.
A, B & C
In a partnership business, the minority partners have better off protection than most minority shareholders because, in the event of breakdown of relationship, the minority partners can normally insist on a dissolution of the partnership business since the other partners cannot continue to use the partnership assets for their sole benefits.
True
False
Does a fiduciary duty arise even when the professional donates services free of charge, so as no contract exist?
True
False
Jack, a stockbroker, was an inexperienced in tax. He a seek the advice of an independent designated tax professional to advise him on tax planning and tax shelter that he needs. Simon, who is a designated accountant who specialized in those areas, advised Jack to invest in a number of multiple unit residential building (MURBs), a real estate investment project. as tax shelter. When the value of MURBs fell during a decline in the real estate market, Jack lost heavily in his investment. The advice was perfectly sound at the time it was given. Unknown to Jack, Simon was also acting for developers in structuring the MURBs and did not disclose that fact to Jack. In this case the court held that:
Simon is liable to compensate Jack for the cost of loss for breach of fiduciary duty due to non-disclosure that he also acts as adviser to the developer which is conflict of interest.
Simon is not liable for the loss of Jack’s investment because the tax advice was perfectly sound when it was discussed, and Jack was given a free hand to decide.
A misrepresentation is fraudulent and amounts to intentional tort of deceit. The tort of deceit may also be committed when a person deliberately conceals or withholds information. Below are elements of deceit, except?
False representation made by the dependant.
Level of knowledge of the falsehood of the representation on the part of the dependant.
The false representation caused the plaintiff to act and the plaintiff’s action resulted in a loss.
All the above
Company A, who is a customer of the bank, owed a substantial debt to the bank. Investor B, who has a huge investment with bank, invested quarter of her investment to Company A. The officer of the bank is well aware that the company is on verge of insolvency but did not disclose this fact to the customer. Does the bank committed deceit and was held liable to compensate the customer?
True
False
When a professional, who has held liable for breach of contract, breach of fiduciary duty and tort, does a court award triple damages to the plaintiff?
True
False
Enron was the seventh largest public corporation in the United States. The energy giant collapsed into bankruptcy and cost investors billions of dollars due massive scale of fraud and impropriety. Arthur Andersen, who is one of the big 5 accounting firm in the United States, is the external auditor of the Enron. In addition, Arthur Andersen also acts as its accountants, business advisers, or management consultants. According to the Supreme Court, imposing liability for breach of fiduciary duty, the characteristics of fiduciary relationship must be established. Please select that applies.
The fiduciary (often a professional) has undertaken to act in the best interest of the beneficiary (often the client).
The beneficiary is vulnerable to or at the mercy of the fiduciary’s control or discretion.
A legal or practical interest of the beneficiary could be harmed by the fiduciary’s exercise of discretion or control.
A, B & C.
Mr. Hunt, who has just retired, set up an investment account with Ms. Jane, an investment specialist, of TD Evergreen. Prior to his retirement, he is a Vice President of a large footwear manufacturer. His knowledge on investment is average and the investment account he has set is non-discretionary no trade will be completed without Mr. Hunt express approval. A non-discretionary account is one in which the investor decides on what trades to make. Without Mr. Hunt’s approval, Ms. Jane sold 2,500 shares which is half of Mr. Hunt 5,000 shares to BCE. By the time Mr. Hunt learned of the disposition of shares of stock, the stock market price went up. Mr. Hunt sued TD Evergreen for breach of contract and breach of fiduciary duty. The court found that the unauthorized sale amounted to:
Breach of contract and breach of fiduciary duty and TD Evergreen is liable for the lost profit.
Breach of contract but not on breach of fiduciary duty because it lacks the necessary degree of discretionary, control reliance and trust.
Does a breach of contract always have a consequence of breach of fiduciary duty and tort?
True
False
In a corporation, the controlling group of shareholders have the ability to determine the composition of the board of directors, to approve their action, to amend the corporation constitution in order to ensure that the affairs of the corporation were entirely manage for their own benefit and to the detriment of the minority. Below are the remedies available to the dissenting minority shareholders, except.
Appraisal remedy
Derivative action
Oppression remedy
A, B & C
Southguard Ltd. (SL) and Soughtguard Holdings Ltd. (SHL) carried on business lending and investing money on the security of real property mortgages. The GC Finance Ltd. was the sole shareholder of SL while HM Managements Ltd. shareholder of (SHL). At all relevant times, ownership in the corporations was separated from management. The firm E & Y was originally hired by SL and SHL to perform annual audits of their financial statements and to provide audit reports to the companies’ shareholders. A few years later, SL & SHL went into receivership. Receivership is a remedy available to secured creditors to recover amount outstanding under secured loan. The shareholders of SL & SHL brought an action against E & Y alleging that audits of the corporations’ financial statements had been negligently prepared, and that in consequence, they had incurred investment losses. The court held that:
There was no contractual relationship between the auditors of a corporation and its shareholder.
The auditors owed no duty of care in respect of their personal investment.
A & C
There was a contractual relationship between the auditors of a corporation and its shareholder and E & Y vicariously liable for the negligence of its auditors.
When a corporation becomes insolvent, the creditors are entitled to whatever assets are available. If a deficiency remains, they may look to the personal assets of the owner. In an unincorporated business, the creditor’s rights are limited to only the assets of the business. If the assets are inadequate, the creditor normally has no further remedy against the owner.
True
False
In relation to the internal affairs of the corporation, below are the most important powers given to the directors, except?
To issue shares and declare dividends.
To adopt by laws and to call meetings of shareholders.
To delegate responsibilities and appoint officers.
Always implement and execute any resolution passed by the majority of the shareholders.
Peter, who is a director, holds a large number of shares in WE Electric Inc. He also a director of Shipbuilding Co. Shipbuilding Co. requires turbogenerator sets for the large ship under construction. WE Electric is one of several manufacturers of turbogenerator. It is the interest of Peter to make sure that Shipbuilding obtains a good quality of equipment at the lowest price, and of the same time, it is his interest to make sure that WE Electric Inc. obtains the contract with the highest possible price. Peter is faced with conflict of interest which is a violation of fiduciary duty. Peter did not profit from the transaction. What should Peter do?
Since deal in good faith and Peter did not profit from contract, endorse the contract Shipbuilding Co.’ directors’ meeting.
Disclose his interest with WE Electric Inc. and abstain from voting during deliberation of the contract.
