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BA4 - Fundamentals of Ethics - Corporate Governance and Business Law

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BA4 Questions and Answers

Question # 1

Which of the following are likely advantages of being a sole trader? Select ALL that apply.


No formal procedures required to set up the business.


Greater degree of independence.


They retain all profits.


Expansion is likely to be fast.


Working hours will be relatively short.


They have limited personal responsibility in regards to the debts of the business.

Question # 2

Which THREE of the following are characteristics of Limited Liability Partnerships ("LLPs")?


LLPs can enter into contracts in their own name


LLPs have no perpetual succession


An LLPs partners are jointly and severally liable for the debts of the LLP


LLPs can hold property in their own name


LLPs are usually created by formal registration under statute

Question # 3

Company X has a good CSR record, and ensures that its employees enjoy safe working conditions, reasonable work hours and are paid fairly Company Y is known to employ child laborers in the countries in which it operates, where the practice is not illegal Company X has entered into a point business partnership with Company Y to carry out a specific project. In order to comply with the OECD Guidelines, what best describes Company X's responsibilities?


Company X would only have a duty to try to stop Company Y from employing child labour if it was illegal in the countries concerned


Company X does not have any responsibilities, as its own record is good and it is not employing any children


It should ensure that it does not inadvertently use any of Company Y^s child workers in carrying out its own work on the project


It should attempt to persuade Company Y of its ethical responsibilities to stop employing children.

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