Question 1

List the cultural factors that you saw in this unit that contributed to the ethical lapses.

Accepted Answer

Numbers pressures
Fear and silence
Ico...

Question 2

Whistleblowers who turn to external avenues for dealing with issues are unethical.

Accepted Answer

A) True 
 B)False

Question 3

The head of security at the Upper Branch mine had the presence of mine inspectors announced.

Accepted Answer

A) True 
 B)False

Question 4

"Each time I see Jeff [Greenberg] I feel like I have a bull's eye on my forehead," was the statement of a CEO's direct report. Discuss how the culture at MMC was similar to the cultures of HealthSouth, Tyco, MiniScribe, Bausch & Lomb, and others.

Accepted Answer

Students should discuss the numbers pres...

Question 5

Compare the behaviors of William Aramony with those of Dennis Kozlowski. Are there signals these CEOs send with their behaviors?

Accepted Answer

Students should discuss the young women ...

Question 6

Which of the following is an effective tool for preventing industry level ethical lapses?

Accepted Answer

A)   Self-regulatory activism
B)   Ethics training
C)   Screening
D)   Internal controls

Question 7

Which of the following factors did HealthSouth, Fannie Mae, Massey Energy, Enron and WorldCom have in common?

Accepted Answer

A)   Federal regulators had been on site at all the companies expressing concerns
B)   They all had weak boards
C)   Obstruction of investigations
D)   All of the above were a common thread

Question 8

Which of the following was not a Kozlowski expense that Tyco paid for?

Accepted Answer

A)   Jimmy Buffett entertainment at Mrs. Kozlowski's birthday party
B)   A $6,000 shower curtain
C)   Ice sculptures in Sardinia
D)   All of the above were Kozlowski expenses paid for by Tyco

Question 9

Prior to the Enron collapse, how many employees did Andersen have?

Accepted Answer

A)   3,300
B)   7,000
C)   11,000
D)   36,000

Question 10

WorldCom employees who raised questions about the company's accounting were forbidden from talking with Arthur Andersen auditors.

Accepted Answer

A) True 
 B)False

Question 11

Who is Jerome LiCari?

Accepted Answer

A)   CEO of Beech-Nut
B)   Plant manager for Beech-Nut
C)   Employee in Beech-Nut's purchasing function
D)   Director of Research and Development for Beech-Nut Nutrition

Question 12

Who said, "My actions caused my wife to go to prison"?

Accepted Answer

A)   Andrew Fastow
B)   David Delainey
C)   Jeffrey Skilling
D)   Ken Lay

Question 13

What did Hughie Elbert Stover not do at the Upper Big Branch mine that resulted in criminal charges against him and Massey Coal?

Accepted Answer

A)   He took federal mine inspectors on tours that avoided certain areas
B)   He instructed others to destroy mine document records
C)   He trained security guards to provide warnings over the radio about the presence of federal mine inspectors
D)   All of the above

Question 14

The "rogue traders" all had the skills to work around company internal controls in order to cover their activities.

Accepted Answer

A) True 
 B)False

Question 15

The WorldCom board:

Accepted Answer

A)   Was known as "Bernie's Board".
B)   Consisted of experienced outsiders.
C)   Approved all loans to Ebbers before they were made.
D)   None of the above

Question 16

Who said, "It's a pity that this happened. Jett could have made $2 to $3 million honestly"?

Accepted Answer

A)   The former head of the SEC who headed up the case against Kidder and Jett
B)   Gary Lynch
C)   Jack Welch
D)   CBS Sixty Minutes

Question 17

A predatory loan:

Accepted Answer

A)   Is a loan that exceeds certain interest limitations or contains certain loan structures.
B)   Is any subprime loan.
C)   Can be affected by some state and local laws.
D)   None of the above

Question 18

Earnings management is the use of accounting techniques to smooth earnings.

Accepted Answer

A) True 
 B)False

Question 19

The failure of an auditor to disclose the possible obsolescence of a firm's major product is a judgment call and not an ethical issue.

Accepted Answer

A) True 
 B)False

Question 20

David Duncan, the audit partner in charge of the Enron account for the Houston Andersen office:

Accepted Answer

A)   Was close friends with Andrew Fastow.
B)   Was close friends with Sherron Watkins.
C)   Was close friend with Richard Causey.
D)   None of the above

Exam 4: Ethics and Company Culture

WorldCom employees who raised questions about the company's accounting were forbidden from talking with Arthur Andersen auditors.

Correct AnswerverifiedShow Answer

Earnings management is the use of accounting techniques to smooth earnings.

Correct AnswerverifiedShow Answer

Whistleblowers who turn to external avenues for dealing with issues are unethical.

Correct AnswerverifiedShow Answer

Compare the behaviors of William Aramony with those of Dennis Kozlowski. Are there signals these CEOs send with their behaviors?

Correct AnswerverifiedStudents should discuss the young women ...View AnswerShow Answer

"Each time I see Jeff [Greenberg] I feel like I have a bull's eye on my forehead," was the statement of a CEO's direct report. Discuss how the culture at MMC was similar to the cultures of HealthSouth, Tyco, MiniScribe, Bausch & Lomb, and others.

Correct AnswerverifiedStudents should discuss the numbers pres...View AnswerShow Answer

The failure of an auditor to disclose the possible obsolescence of a firm's major product is a judgment call and not an ethical issue.

Correct AnswerverifiedShow Answer

Which of the following is an effective tool for preventing industry level ethical lapses?

Correct AnswerverifiedShow Answer

The head of security at the Upper Branch mine had the presence of mine inspectors announced.

Correct AnswerverifiedShow Answer

Prior to the Enron collapse, how many employees did Andersen have?

Correct AnswerverifiedShow Answer

The "rogue traders" all had the skills to work around company internal controls in order to cover their activities.

Correct AnswerverifiedShow Answer

A predatory loan:

Correct AnswerverifiedShow Answer

What did Hughie Elbert Stover not do at the Upper Big Branch mine that resulted in criminal charges against him and Massey Coal?

Correct AnswerverifiedShow Answer

Who is Jerome LiCari?

Correct AnswerverifiedShow Answer

Who said, "My actions caused my wife to go to prison"?

Correct AnswerverifiedShow Answer

The WorldCom board:

Correct AnswerverifiedShow Answer

Which of the following factors did HealthSouth, Fannie Mae, Massey Energy, Enron and WorldCom have in common?

Correct AnswerverifiedShow Answer

List the cultural factors that you saw in this unit that contributed to the ethical lapses.

Correct AnswerverifiedNumbers pressures Fear and silence Ico...View AnswerShow Answer

David Duncan, the audit partner in charge of the Enron account for the Houston Andersen office:

Correct AnswerverifiedShow Answer

Which of the following was not a Kozlowski expense that Tyco paid for?

Correct AnswerverifiedShow Answer

Who said, "It's a pity that this happened. Jett could have made $2 to $3 million honestly"?

Correct AnswerverifiedShow Answer

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Students should discuss the young women ...
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Students should discuss the numbers pres...
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Numbers pressures
Fear and silence
Ico...
View Answer

Correct Answer
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