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Questions and Answers
What is the main function of professional ethics?
What is the main function of professional ethics?
- To guide behavior in a business environment (correct)
- To regulate personal conduct in daily life
- To define organizational standards
- To dictate personal values
How are professional ethics different from values?
How are professional ethics different from values?
- Professional ethics focus on relationships with employees, while values focus on relationships with employers
- Professional ethics are codified as a set of rules, while values are unique to each person (correct)
- Professional ethics are flexible, while values are rigid
- Professional ethics cover only personal standards, while values cover organizational standards
What is the primary purpose of a code of ethics?
What is the primary purpose of a code of ethics?
- To regulate personal behavior outside of work
- To establish uniform personal values
- To promote individualism and independence
- To provide guidelines for professional conduct (correct)
What do professional ethics encompass?
What do professional ethics encompass?
How do professional ethics differ from personal ethics?
How do professional ethics differ from personal ethics?
What is the primary difference between personal ethics and professional ethics?
What is the primary difference between personal ethics and professional ethics?
In what scenario might personal and professional ethics clash according to the text?
In what scenario might personal and professional ethics clash according to the text?
What is the purpose of codes of professional ethics as stated in the text?
What is the purpose of codes of professional ethics as stated in the text?
What is expected of a professional in terms of expertise, according to the text?
What is expected of a professional in terms of expertise, according to the text?
What is the main responsibility of an accountant as a professional, according to the text?
What is the main responsibility of an accountant as a professional, according to the text?
What is the primary focus of corporate governance theories?
What is the primary focus of corporate governance theories?
Which theory emphasizes the role of management as stewards who act in the best interest of the shareholders?
Which theory emphasizes the role of management as stewards who act in the best interest of the shareholders?
According to agency theory, what is a potential issue when managers pursue their own interests over the shareholders' interests?
According to agency theory, what is a potential issue when managers pursue their own interests over the shareholders' interests?
Which theory focuses on the relationships between an organization and its external environment, such as suppliers and creditors?
Which theory focuses on the relationships between an organization and its external environment, such as suppliers and creditors?
In the context of corporate governance, which theory emphasizes the broader impact of business decisions on society?
In the context of corporate governance, which theory emphasizes the broader impact of business decisions on society?
According to resource dependence theory, what can organizations do to reduce their vulnerability to external resource providers?
According to resource dependence theory, what can organizations do to reduce their vulnerability to external resource providers?
Which theory emphasizes the need for clear, transparent communication and collaboration between an organization and its various stakeholders?
Which theory emphasizes the need for clear, transparent communication and collaboration between an organization and its various stakeholders?
How does stewardship theory differ from agency theory regarding the behavior of managers?
How does stewardship theory differ from agency theory regarding the behavior of managers?
Which factor is NOT central to resource dependence theory?
Which factor is NOT central to resource dependence theory?
What is a key focus of agency theory in relation to the principal-agent relationship?
What is a key focus of agency theory in relation to the principal-agent relationship?
In what way does stakeholder theory differ from stewardship theory?
In what way does stakeholder theory differ from stewardship theory?
What is a potential implication of minimizing resource dependence according to resource dependence theory?
What is a potential implication of minimizing resource dependence according to resource dependence theory?
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Study Notes
Professional Ethics
- The main function of professional ethics is to provide guidelines for behavior and decision-making in a professional context.
- Professional ethics differ from values in that they are specific to a profession and are based on the values and principles of that profession.
- The primary purpose of a code of ethics is to establish standards of conduct and behavior for professionals in a particular field.
Personal vs. Professional Ethics
- Professional ethics encompass the rules, norms, and standards that guide a professional's behavior and decision-making.
- Professional ethics differ from personal ethics in that they are specific to a profession and are based on the values and principles of that profession.
- The primary difference between personal ethics and professional ethics is that personal ethics are individual and subjective, while professional ethics are external and based on the profession.
Code of Ethics
- The purpose of codes of professional ethics is to provide guidelines for behavior and decision-making in a professional context.
- Codes of ethics outline the expectations for professional behavior and decision-making.
Expertise and Responsibility
- Professionals are expected to have a high level of expertise in their field and to stay up-to-date with developments in their profession.
- The main responsibility of an accountant as a professional is to provide accurate and unbiased financial information.
Corporate Governance Theories
Agency Theory
- Emphasizes the principal-agent relationship, where managers (agents) act on behalf of shareholders (principals).
- A potential issue arises when managers pursue their own interests over the shareholders' interests.
Stewardship Theory
- Emphasizes the role of management as stewards who act in the best interest of the shareholders.
- Differ from agency theory in that managers are seen as stewards rather than agents.
Resource Dependence Theory
- Focuses on the relationships between an organization and its external environment, such as suppliers and creditors.
- Organizations can reduce their vulnerability to external resource providers by diversifying their resources or building relationships with multiple providers.
Stakeholder Theory
- Emphasizes the broader impact of business decisions on society.
- Differs from stewardship theory in that it considers the interests of all stakeholders, not just shareholders.
Communication and Collaboration
- The purpose of stakeholder theory is to facilitate clear, transparent communication and collaboration between an organization and its various stakeholders.
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