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NEW QUESTION 35
FGT is evaluating the political risks associated with its operations around the world.
Which of the following would indicate that a particular subsidiary has a high level of political risk?

A. The subsidiary's host country requires the active participation of local partners before the subsidiary can operate.B. Company law in the subsidiary host country is lax.C. Forthcoming elections in the subsidiary's host country.D. The subsidiary employs a large number of nationals from the host country.E. The subsidiary is located a considerable distance from FGT's home country.

Answer: A,B,C

 

NEW QUESTION 36
S, a qualified and experienced professional accountant, has been appointed as a non-executive member of the Audit Committee of X X has recently obtained a listing on the second tier of a reputable Stock Exchange B, the Finance Director, is only worried about the maintenance of proper financial controls and is less concerned with operational controls S has asked A.
The Production Director, to produce regular reports for the Audit Committee on production specification compliance and related issues A is concerned that this means S does not think he is doing his job properly and doubts his integrity In relation to this scenario, which of the following statements are valid?
Select ALL that apply.

A. There is no benefit for X of A producing reports for the Audit Committee unless there are some members on the Audit Committee who have expertise in the production areaB. The appointment of an independent professionally qualified and experienced accountant will help strengthen the Audit Committee.C. A is correct in believing that being asked to report to the Audit Committee in the manner described above suggests a lack of trust in his ability or integrityD. If X is not seen to have an effective Audit Committee it will be exposed to increased market riskE. The Audit Committee should plan for the receipt of regular reports on production specification compliance and related issuesF. B is correct to be more concerned about the maintenance of financial controls because they are inevitably more important than operational controls.

Answer: E,F

 

NEW QUESTION 37
M plc is an IT company that bids for large contracts to sell computer systems and also to service existing systems. M plc's senior management has always set budgets which are hard to achieve and have made no allowances for the recession.
The economy has improved and M plc's senior managers have made the budget even more optimistic. The budgeted sales target has been increased by 40%.
In the past, sales staff have not tried to achieve the budget sales because it was generally believed that the targets were impossible to reach.
M plc has recently appointed a new Sales Director who has decided that sales staff will be dismissed if they fail to meet sales targets for three successive months. He is also looking for higher sales margins than were achieved before.
What are the likely consequences of the new Sales Director's policy?

A. Sales staff will be happier in their jobs.B. Sales staff will encroach on other sales staff territories to get more work.C. Sales staff will tender for riskier contracts.D. Sales staff will look for new jobs.E. Sales staff will feel more settled and secure in their jobs.

Answer: B,C,D

 

NEW QUESTION 38
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