ACCA F1 mock exam

1. The objectives of which of the following bodies include the establishment of high quality professional standards in financial reporting and the promotion of convergance of these standards across frontiers?

a. IFAC
b. IASC
c. IASB
d. ICSA

2. Which of the following may indicate an increased risk of fraud in an organization?

1. High staff turnover
2. Disgruntled unhappy staff
3. Culture of non-compliance with policies and regulations
4. Authoritarian senior management

a. 2,3,4
b. 1,2,3
c. 1,2,4
d. 1,3,4

3. Which of the following is macro-economics the study for?

a. The economy as a whole
b. The local and regional economy
c. The organization as a whole
d. The individuals elements that make up the economy

4. Which two production-related functions should be performed by the accounting department?

a. Calculating production cost variances
b. Preparing a purchase and wages budget
c. Estimating production quantities
d. Making decisions as to which products to make

‘5. What is the main purpose of financial statements?

a. To communicate information between directors and managers
b. To inform employees about company progress
c. To report information to stakeholders

6. One model of organizational culture defines four basic types namely Power, Role, Task and Person cultures.
Which writer proposed this model?

a. Hotsfede
b. Schein
c. Handy
d. Tuckman

‘7. Which of the following is an advantage of a just-in-time (JIT) purchasing strategy?

1. Bottlenecks in supply are avoided
2. Delivery frequency is reduced
3. Inventory holding costs are minimized

a. 1,2,3
b. 1 and 2
c. 3 only
d. 1 and 3

8. Which of the following is a feature of the informal organization?

a. Flexibility
b. Permanency
c. Rigidity

9. Which two of the following are examples of government policies designed to deal with an increasingly ageing population?

a. Subsidized nursing care
b. Raising the retirement age
c. Increasing the number of university places
d. A reduction in personal taxation

10. Which of the following represents ethical behavior by an accountant?

a. Billing the client for 20 hours when the work took 25 hours to complete
b. Reporting the fraud by the client’s staff to the press or other media
c. Reporting fraud by the client’s staff to the management of the company

11. An organization expects to undertake numerous different projects. Project groups will be set. Up, drawn from the various departments, and then disbanded once the project is complete.

What type of organizational structure is this?

a. Departmental
b. Matrix
c. Functional

‘12. Which two of the following would indicate a strong control environment?

a. Good communication of ethical values
b. High turnover of staff at all levels
c. Frequent changes of organization structure
d. Participation by those charged with governance

‘13. The responsibility for maintaining proper books of account in a limited company lies with which of the following?

a. The person responsible for recording transactions
b. The chair of the board of directors
c. The head of the finance function
d. The board of directors collectively

14. Which of the following are true of internal auditors?

1. Internal auditors review the control system and recommend improvements
2. Internal auditors consider whether the financial statements give a true and fair view
3. Internal auditors consider only the financial aspects of the business
4. Internal auditors report to the management of the company

a. 1,2 and 3
b. 2 and 4
c. 1 and 4
d. All of the above

15. For which two types of business or organization are social or demographic changes especially significant?

a. home building companies
b. a commercial landscaping business
c. manufacturers of power plant equipment
d. hospitals
16. Which of the following examines the workings of an informal group?

a. Taylor’s scientific management theory
b. X and Y theory
c. The Hawthorne experiment
d. Mayo’s hierarchy of needs

‘17. Is the external auditor responsible for preventing and detecting fraud?

a. Yes