CBI Practice Exam 2 - KnowledgeEquity

In total, 88% of all Australia's internet users use social media services (Sensis 2018) and different social media platforms support different types of communication and interaction. What type of technology enables sharing of expertise, building up a repository of knowledge and supports discussion about the content? A Wikis B Microblogging C Blogs and vlogs D Online communities

A is correct because a wiki is a website that is open for permitted users or the public to edit. It is used for expertise sharing, building up a knowledge base or reference work over a period of time. Also supports discussion about the content on each page. B is incorrect because it is typically used for sharing news, communication and engagement as well as locating expertise within organisations. C is incorrect because blogs and vlogs are used for stating opinions and tends to have a strong author 'voice'. For example, it can be used for setting an agenda and then collecting responses via comments. D is incorrect because it is primarily used for personal or business communities for promotion, advertising and recruitment.

A special type of entrepreneurship is focused on ventures that generate social value and help lead to social change or meet the needs of society. Social entrepreneurship often focuses on issues that may not generate financial returns and therefore are ignored by private markets. Which of the following is a key principle of a social business pursuing social entrepreneurship? A Investors should not receive a return on investment and therefore do not receive a dividend. B The main priority is that the business is socially sustainable, with less focus on financial sustainability. C The workforce willingly accepts lower pay than in commercial organisations because of the focus on social outcomes. D Company profits should not be retained, but fairly distributed to stakeholders because the focus is not on wealth creation.

A is correct because according to Muhammad Yunus (Grameen Creative Lab 2014), the key principle is that no returns on investment are expected. B is incorrect because it must be both socially and financially sustainable (not just socially). C is incorrect because the workforce should receive market wages and better working conditions (not lower wages.) D is incorrect because company profits should be retained (rather than distributed to stakeholders).

Ongoing, deep stakeholder engagement can act as a cushion toward reputational problems, as stakeholders have greater trust and confidence in the company. Which of the following relating to stakeholder engagement and stakeholder relations is correct? A 30% of corporate earnings are affected by the company's reputation with external stakeholders. B Stakeholder management does not impact customer trust and preference when purchasing goods from companies. C Companies with good stakeholder relations requires more costs to ensure stakeholders are compensated accordingly. D Poor stakeholder engagement is more likely to lead to a reduction of cost when managing the outcomes of conflicts with communities.

A is correct because according to the research, 30% of corporate earnings are affected by the company's reputation with external stakeholders. B is incorrect because 80% of customers prefer to purchase from trusted companies, while 63% refuse to buy from distrusted companies. C is incorrect because companies with good stakeholder relations emerge from financial distress faster and more permanently than firms with poor stakeholder relations. D is incorrect because poor stakeholder engagement is more likely to lead to substantial costs associated with preventing, responding to, or managing the outcomes of conflicts with communities.

When used as part of an overall business strategy, integrated ICT services can make any business stand out in today's globalised and complex marketplace. Which of the following describes an ICT technique used to build a sustainable business success? A Automating routine enquiries using chat bots thus relieving information technology and human resource departments of responding to repetitive enquiries. B Using e-commerce and online payments allow immediate customers' purchase decisions and provides a greater advantage for larger corporations only for access to a broader customer market. C Blogs and other social media platforms can be used by a business to share open public discussion on a specific industry and ensure that negative feedbacks are created for competitors to improve the business market standing. D Social media can be used to position a business strongly in its market by developing an active community of 'fans' within its customer base. Such a community can be paid lucratively for writing up positive reviews to increase business profitability and improve customer market position.

A is correct because automation of repetitive tasks such as accessing payroll information or leave information, relieves resources from performing repetitive tasks. B is incorrect because ICT services can make any business (including small local businesses) stand out in today's globalised and complex marketplace. C is incorrect because blogs and other social media platforms can be used by a business to share open public discussion on a specific industry, rather than focusing narrowly on its own products and services. This can provide a business with an authoritative and generous image, increasing its market standing. It should not be used to create negative feedbacks for competitors. D is incorrect because such a community can be used to provide feedback on products and services, assisting with new product developments. By compensating 'fans' to write positive reviews, this can lead to a bad company image and long term reputational damage.

The integrated reporting framework recognises the economic, social and environmental context within which organisations create value. Which of the following capitals within the IR framework encompasses people's competencies, capabilities, experience and motivation to innovate? A Human capital B Natural capital C Intellectual capital D Manufactured capital

A is correct because human capital encompasses people's competencies, capabilities, experience and motivation to innovate. B is incorrect because natural capital is all renewable and non-renewable environmental resources and processes that support the prosperity of an organisation; it includes air, water and issues relating to biodiversity. C is incorrect because intellectual capital includes knowledge-based intangibles, such as patents, and organisational capital, such as systems and procedures. D is incorrect because manufactured capital includes non-natural physical objects available to the organisation (including buildings, equipment and infrastructure).

In general, the accountant is responsible for ensuring information and analysis provided to decision makers in the company is accurate and supports good decisions. Further, they can also contribute to effective reputation management for an organisation. Which one of the following describes how accountants contribute to effective reputation management? A Influencing the alignment and transparency of remuneration policy. B Only consider non-financial impacts whenever a major reputational crisis arises. C Exclude reputation risk from organisational risk analysis to avoid internal audit assessments. D Remembering that financial performance and cost-cutting activities are core drivers of reputation.

A is correct because it is a key contributing factor to effective reputation management by an accountant. B is incorrect because accountants need to ensure that appropriate non-financial impacts are considered when financial information is used for internal decisions. C is incorrect because accountants need to ensure that reputation risk is included in organisational risk analysis and is considered as part of the internal audit's scope. D is incorrect because accountants need to take into consideration that financial performance and governance are core drivers of reputation.

Effective and deep engagements are critical to help a diverse range of stakeholders engage with the business rather than just those that have the most resources or 'loudest voice'. Which of the following options would be present in an effective engagement checklist? A Include a process for reporting back to those consulted in a timely way on actions taken, with clarification regarding upcoming steps. B Intentionally include key executives in stakeholder engagements to help them understand the issues and encourage strategic decision-making based on stakeholder input. C Proactively reach out to develop a positive relationship with critical stakeholders before a crisis arises. Communicate often, with transparency and integrity, not just when the company needs something. D Develop engagement plans that account for the whole organization, analyse business-connected activities that affect external stakeholders, and ensure that the company has feedback mechanisms to capture all grievances and ensure remediation.

A is correct because it relates to effective stakeholder management and once in place, it would open up discussions and determine options for deeper engagements. The remaining options are incorrect because they form part of the deep engagement checklist (Refer to Figure 5.18).

Which of the following best describes the difference between leaders and managers? A Managers make things happen and leaders guide people to a single purpose outcome. B Managers create opportunities and provide inspiration so that teams deliver outcomes. C Leaders make things happen and engage in routine interactions to keep staff motivated. D Managers focus on interpersonal styles to get groups of people to do what they want them to do.

A is correct because leaders are there to coach and guide and get people to move towards the organisation's key purpose and strategic objective. Managers control resources and funds and make the initiatives and actions happen. B, C and D are not correct descriptions of the difference between leaders and managers.

A company was receiving heavy criticism after the release of its annual report. Shareholders expressed a view that the company had not reported sufficiently at sustainability practices and strategy, nor had it addressed how strategy around governance and ethical leadership was progressing. A Produce an integrated report that shows the links to these perspectives. B Write a corporate social responsibility report to go with the annual report. C The CEO should address the concerns in an extraordinary shareholder meeting. D Modify the annual report to include a section on sustainability and governance.

A is correct because the development of the integrated report (IR) came from a need to both declutter annual reports and provide a holistic report that shows the links between different perspectives such as sustainability, environmental impacts, ethics and governance, and business operations and strategy. B is incorrect because this is what was occurring before IR and it only added more content to an already cluttered annual report. It also does not show the links as clearly between the different perspectives and typical CSRs do not address internal ethical and governance issues. C is incorrect because this might go some way to alleviate shareholder concerns but this is not a long-term fix for the issue that will just arise again the following year. D is incorrect because modifying the annual report is the right step but is not going far enough. IR delivers clear links between all the perspectives and does it in a way that gives a broader more holistic picture of the organisation's performance.

According to Enright, McElrath and Taylor (2016), there are five main drivers of change in stakeholder engagement. Which of the following describes the change needed for businesses and governments to ensure labour conditions at least meet basic human rights standards? A Supply chain oversight ramps up. B The primacy of climate change and water resource. C The demographic shift and the automation of work. D Individual empowerment and the rise of the middle class.

A is correct because the globalisation of business has achieved numerous efficiencies, but a by-product has been supply chains that can involve abusive working conditions and severe environmental degradation. Concerted efforts by international pressure groups has brought worldwide attention to these issues and promoted supply chain transparency and oversight as key stakeholder management issues. B is incorrect because it relates to the concern about climate change and how the use of finite natural resources have also brought pressure on businesses from a variety of stakeholders to adopt more sustainable practices. C is incorrect because automation of jobs and the ageing of the population in many economies is likely to see a substantial shift in the role of work in an economy. D is incorrect because this change relates to dissatisfaction with inequality, poor social outcomes, corrupt and dysfunctional government and a lack of sustainability in business approaches.

Sandy Parker is leading a new team of financial staff at FutureWork Services, a company specialising in providing advice on high-technology solutions for workforce management. As finding sufficiently qualified people in a single location was difficult, Sandy is considering that providing teleworking facilities will be the best way for a geographically-dispersed team to work well together, and that this will also showcase the company's approach to workforce management. Sandy is aware that some of the company's potential clients may be sceptical about telework, and is keen to ensure that her team will showcase a successful approach to this way of working. Which one of the following approaches will best address some of the perceived shortcomings of telework? A Provide effective communication and collaboration tools, with goal-based performance assessment. B Take steps to build a strong team culture, with an awareness of the privileges these staff have been granted. C Ensure that workloads and performance are carefully monitored, and that planned work hours are not exceeded. D Restrict the time that staff spend in meetings and unnecessary discussions, while maintaining a high level of trust

A is correct because there is a traditional view that staff working remotely would have communication and collaboration problems. However, professional staff tend to work well when given the tools and resources they need to do their job. Communication tools need to support the spontaneous interactions that occur when people work together in person. Performance must be assessed by assessing achievement of goals, rather than through hands-on control of activities. B is incorrect because one of the criticisms of teleworking is that it can produce a culture of entitlement in teleworking groups, setting them apart from workers who are not granted the opportunity to telework. A culture of engagement and collaboration should be encouraged. C is incorrect because performance assessment should be based on achievement of goals, rather than through monitoring and control. Teleworking staff have been found to spend more time working than office-based staff. D is incorrect because while trust is important, it is the spontaneous interactions and non-verbal communication that occurs in offices that is perceived to be lacking in teleworking.

"In 2018, the European Commission announced the Action Plan: Financing Sustainable Growth, recognising the need to direct more investment towards social and environmental goals and encouraging the finance industry to operate in ways that better benefit society." The plan proposes to introduce a number of new regulations aimed at moving sustainable investment into the mainstream. Which one of the following is correct about the introduction of additional regulatory requirements for existing social and environmental finance institutions? A The existing institutions are often relatively small so the new regulations could place a burden on them. B The existing institutions value transparency and will be well-positioned to report against the new regulations. C By bringing sustainable investments to the mainstream the new regulations will reduce costs for the existing institutions in the long term. D Increased regulation will grow the sector as the public will have greater confidence so this will lead to greater returns in the long term for the existing regulations.

A is correct because these small institutions will be impacted by an increased regulatory burden. B is incorrect because social enterprises will have a resourcing cost to be able to report. C is incorrect because the short term increase in the regulatory burden may mean that some social ventures are not able to continue into the long term. D is incorrect because while public confidence may increase this may benefit large institutions rather than social enterprises.

Emily Malve wanted her company to be regarded as highly ethical. The covid pandemic put enormous pressure on the company's finances and subsequent rapidly increasing inflation has made the situation even worse. Emily knows that there is more pressure on employees to bend the rules to ensure both the company and their jobs are secure, however, she is concerned that even if unethical practices are occurring she would not know about it. Which one of the following actions should Emily take? A Put in strong policies to protect those who report misconduct. B Appoint more women appointed to senior management positions. C Develop and release a charter of ethics and policies around misconduct. D Develop strong dismissal policies for people who breach ethical standards.

A is correct because this is the only option that will give Emily a more accurate picture of what is occurring in her organisation that might be breaching ethical boundaries. If her employees don't have the confidence to report misconduct Emily has no chance of rectifying issues where employees are being unethical. B is incorrect because there is no evidence that more women in senior positions will result in identifying issues of misconduct. C is incorrect because although a charter would help, it is not necessarily going to encourage employees to expose issues of misconduct. D is incorrect because strong dismissal policies might help once misconduct is identified but without making employees feel safe to report such behaviour, the identification of issues will never occur.

Jessie Dhillon has recently completed a double business and accounting degree, and has started work at MacDowell Manufacturing, a large engineering and manufacturing company based in Sydney. Jessie has noticed that many of the senior engineers are near retirement age, and that there are no arrangements in place for them to pass on the expertise that they have gained over their long careers to younger employees. Jessie studied Knowledge Management in her degree, and is of the opinion that the company would benefit strongly from developing knowledge sharing techniques to ensure that knowledge is not lost from the company as the older workers retire. Which one of the following statements reflects the most relevant argument that Jessie could use to suggest to her manager that the company should invest in knowledge sharing? A To prevent loss of business value, the retiring staff must be given an opportunity to share their tacit knowledge with others. B The company needs to develop strategies to identify, capture and structure its intellectual assets to enhance its performance. C Arrangements should be made for retiring staff to record their work processes to enable the company to reuse t

A is correct because this reflects the importance of capturing this knowledge - organisations receive significant value from intellectual assets, and sharing and transferring knowledge plays a critical role in effective functioning of organisations. It also reflects the tacit nature of this knowledge, and that it will only be effectively shared when appropriate arrangements are made to allow this. B is incorrect because in this case, the knowledge has already been identified. Capturing and structuring are more relevant activities for explicit knowledge rather than the tacit knowledge these workers have gained over their long careers. The goal in this case is to retain the knowledge, rather than enhancing current performance. C is incorrect because these workers have developed tacit knowledge. This knowledge is more effectively shared through personal interaction rather than through recording it as explicit knowledge. D is incorrect because these workers have built up tacit knowledge, not explicit knowledge.

Where GHG emissions remain an externality, companies involved do not bear the full cost of those emissions. As a result, efforts to rectify this have focused on creating an economic incentive to reduce emissions, either through regulation or through establishing a carbon price. Under an emissions trading scheme, firms may sell their surplus (extra permits) to firms that are not able to meet the required reductions. Which of the following accurately describes an advantage of this scheme? A Establishes an 'emission' cap. B Compensates the most profitable firm. C Carbon prices are setup by the largest energy producer. D Ensures national quota is obtained based on key stakeholder relationship.

A is correct because this system does establish an 'emissions cap' which relates to a maximum level of overall national emissions. B is incorrect because it compensates the most efficient firms. C is incorrect because it facilitates the trading of carbon credits, allowing the market to set the carbon price. D is incorrect because it ensures that the national quota is obtained at a minimum cost to the economy.

Accountants are often asked to assist businesses with financial processes like accounts payable, receivables, working capital, operational expenses and more. Which of the following is one of the common issues accountants face when they investigate underlying causes for a problem? A Formal procedures are either non-existent or not regarded by employees. B The financial benefits from improved cash flow cannot often be easily calculated. C Improvements are measured against baseline trends but are not often communicated. D It is often difficult to discuss non-financial benefits with clients because they can't see them.

A is correct because unfortunately accountants will find that formal procedures are not in place, or are not regularly followed.This can be a cultural issue where employees don't have a "buy in" to the way management want them to operate, and therefore resist or ignore procedures. B is incorrect because they can be easily calculated. C is incorrect because improvements should be measured against baseline trends but the question is about finding underlying causes. D is incorrect because it is not that difficult to discuss non-financial benefits. Yes, some clients might initially dismiss them as hard to measure but they can see them occurring.

Which of the following best describes the music streaming service Spotify? A Freemium model B Platform economy C Subscription model D On-demand model

A is correct. Basic Spotify can be accessed for free. Consumers are then encouraged to upgrade for a more 'premium' experience. B is incorrect as this is an umbrella term for the transactions and interactions that take place online. C is incorrect because subscription models require users to pay a regular fee to access goods or services. D is incorrect because on-demand refers to goods and services that are a single transaction purchased when wanted or needed.

Patrice Carter is the CEO of Proof Proper Editing, a company that provides editing services for specialist technical journals. When the business first commenced it operated from an office in the Sydney CBD. As access to technology and the internet evolved the work now be done remotely. Patrice is aware that the need for Proof Proper's services has diminished over the past three years, with organisations increasingly choosing to publish their journals on their own websites and portals, with editing done by their own teams. As a result of these changes, Patrice is looking to change the business model and transition from a small team of full-time employees to using a wide pool of contractors. Patrice has asked you to advise her on the benefits and risks of this approach. Which one of the following is not correct? A The use of contractors is a cost-effective way to manage fluctuation in workload. Patrice would likely be able to have her current permanent staff join her as contractors. B The increase in the use of contractors has benefits for workers and organisations. Contractors are able to work when and where they want to and are able to choose to do work that interests them. Organisati

A is correct. There are legal issues that arise when contractors do a large amount of regular work for a single employer. B is not correct as these are benefits of using contract workers. C is not correct as this is a risk of Patrice's proposed approach. D is not correct as this is a way to best engage contract workers.

Which one of the following is not a legal issue associated with a remote workforce? A Workers Insurance. B Access to suitable technology to facilitate work. C Taxation laws in the location where the employee resides. D An employee's right to work in the geographic location they wish to work from.

B is correct as access to technology is not a legal issue. A, C and D are legal issues that must be considered in relation to employees working outside of the office.

Jerry Niven has been assessing the age groups of the employees in her department. She has found that the team consists of a mix of ages, but that the largest generations represented are baby boomers and Generation Y. Jerry is keen to ensure that she makes the best of the age diversity in this team. Which one of the following statements represents the approach that is most likely to reap these benefits? A Encourage work-life balance, while ensuring clear paths for promotional opportunities. B Focus on creativity and positive attitudes, providing opportunities for knowledge transfer. C Provide opportunities for independent working, while offering training to boost technology skills. D Develop formal rules for workplace engagement to improve collaboration between the age groups.

B is correct because Gen Y workers can sometimes struggle to maintain a positive attitude. Age diversity can lead to creativity, and older staff can transfer their knowledge to younger employees. A is incorrect because while baby boomers may struggle to maintain good work-life balance, it is more likely Gen Z workers who have aspirations for promotions. C is incorrect because it is Gen X workers who prefer to be independent. Gen Y workers are already tech-savvy. The benefitof age diversity is for knowledge to be transferred between groups, which will reduce the need for formal training. D is incorrect because it is baby boomers who will prefer to focus on compliance with rules and regulations, and Gen Y workers prefer to be more adaptable. A focus on rules would be unlikely to help Gen Y workers to be more collaborative.

Which area of the world has the second highest increase in microfinance portfolio size in 2017? A South Asia B East Asia and the Pacific C Middle East and North Africa D Latin America and the Caribbean

B is correct because according to Figure 2.11, East Asia and the Pacific's portfolio grew by 18% in 2017, surpassed only by South Asia at 24%.

There is currently debate around the strategies and ethics behind microfinance organisations. At first glance, this seems surprising because microfinance is about providing loans to disadvantaged people who would otherwise not be able to get credit for their business or their personal lives. Which of the following best describes the reasons behind this debate? A Microfinance NGOs often become large banks over time, then remove their original products. B Interest rates charged by microfinance operators are very high and are thought to be predatory. C Microfinance organisations never reach high market penetration, so ultimately have little impact. D Regulators in developing countries often stop microfinance institutions from growing or even operating.

B is correct because although it sounds surprising, microfinance organisations often charge interest rates in excess of 20% for small loans. For example, Grameen Bank charges 20% for income generating loans. This is an extremely high interest rate and similar to what is known as "fast finance" in developed countries, which is coming under increasing scrutiny for being predatory and unethical. A is incorrect because there is no evidence that if a MFI turned into a large bank it would remove it's original credit or savings products. C is incorrect because whether a MFI has a high market penetration is not necessarily relevant to whether it is a successful enterprise. D is incorrect because there is no evidence that this is occurring. The study guide provides opposing evidence that in places like Pakistan and Kenya, governments are assisting MFIs to operate.

Which of the following is correct about how people view the sharing economy from the research by Beutin (2018)? A People who use sharing economy finance services are mostly males from lower socio-economic backgrounds. B Lack of awareness about products and liability concerns are the biggest growth barriers for sharing economy finance services. C The automotive and transport industry has the highest share economy uptake of all industries due to the rise of companies like Uber. D More users are attracted to the sharing economy for its improved value for money than whether it is less expensive than owning assets.

B is correct because although sharing economy financial services is estimated to be worth over EUD 20 billion, the barriers to growth for this market is a lack of awareness (and probably understanding) of these types of financial products and services, and concerns over liability. A is incorrect because users are mainly male with relatively high income. C is incorrect because media and entertainment has the highest uptake with 28% and automotive and transport has 19%. D is incorrect because users are attracted to the concept, more because of the lower expense due to not owning an asset than it being about improved value for money.

Different aspects of external communication will normally be handled in different ways and by different parts of the organisation, depending on the target audience. The media employed will also vary, based on the purpose of the communication. What type of external communication relies on information communicated through an annual report or newsletter? A Supply chain communication. B Shareholder communications. C Internal employee communication. D Regulator and government communication.

B is correct because an annual report or newsletter are formal channels to communicate with shareholders. A is incorrect because supply chain communication will usually be conducted on a one-to-one or procedural basis. C is incorrect because the media used for internal communications will vary, depending on the size of the organisation, from face-to-face or paper-based processes to electronic media or social media. D is incorrect because government communication has its own requirements: various forms of reporting are mandated and specific requests for communication need to be responded to. In many organisations, these communications will be handled by the office of a company secretary or a regulatory or government relations department.

An Australian-based manufacturing company decides to close down its manufacturing facility of specialty parts in India and bring that function to its existing operations in Australia. There are five approaches it could take in this situation: automation | disaggregation | consolidation | commercialisation | relocation. Based on a value chain perspective, which of the following approaches is most likely to describe the change? A Automation. B Consolidation. C Disaggregation. D Relocation.

B is correct because consolidation or centralisation is where similar activities are combined so they are conducted in one place. This brings economies of scale, and greater efficiency of operations without variations. A is incorrect because Automation is likely to reduce complexity, but is not about bringing together similar functions in one location. C is incorrect as disaggregation is the opposite of consolidation. D is incorrect as Relocation is where shared activities are also brought to one place however this is typically selected on the basis of cost and is not targeted at increasing efficiency.

Sustainable innovation is the key to future sustainability. Which of the following relate to developing viable alternatives or using resources efficiently? A Recycling. B Reducing waste. C Reducing pollutants. D Reusing products either for the same purpose or a new purpose.

B is correct because developing viable alternatives or using resources efficiently relates to reducing waste. A is incorrect because recycling relates to reprocessing waste to create a new product. C is incorrect because reducing pollutants relates to issues such as plastics that do not decompose and have no real way of being disposed too. D is incorrect because reusing involves using a product over and over for one particular purpose or using a product for an unrelated purpose.

The CEO of Pike Project Services has asked the CFO, Gerald King, for advice on reducing the company's labour costs. When investigating this, Gerald notices that the employees are mostly in full-time, salaried positions, and that many have been with the company for more than ten years. Many of them are highly paid, experienced engineers. Which one of the following represents the best advice for Gerald to give the CEO? A Costs can be reduced significantly by moving full-time staff to short-term contracts. B Initiatives should be developed to retain employees, so that turnover costs are avoided. C Full-time staff should be replaced by contractors, with the turnover costs reported as overheads. D Training costs for new staff can be offset by recruiting graduates on lower pay rates than existing staff.

B is correct because hiring new staff and training them so that they can contribute productively takes time and the cost can be significant, so initiatives focused on employee retention should be developed. This is particularly important where the existing staff are qualified and highly-skilled. A is incorrect because this does not take into account employee resistance to this move. This could increase the risk on incurring high costs due to staff turnover. C is incorrect because the true costs of turnover of highly-skilled staff should be correctly reported, rather than letting it be hidden in overhead accounts. D is incorrect because there is no guarantee that offsetting this costs would be of more benefit than retaining the staff and reducing turnover costs.

An accountant was reflecting on why an earlier meeting with a client had gone badly. He had advised them on deleting certain products from their portfolio that were not performing. The CEO had defended those products because they were solely designed by the company's R&D team and employees were proud of them. The accountant had told him that his reasoning was flawed and that employees should not have any say over what determines the profitability of the company. Which of the following best describes why the meeting did not go well? A The client was using emotion over data to overrule the accountant's recommendation. B The accountant didn't show empathy and an ability to identify with the client's position. C The client would not accept the reality of the situation and was stubborn in their approach. D The accountant had failed to appreciate the differences between SMEs and large companies.

B is correct because in this situation the accountant should have shown more empathy and see the situation from the client's point of view. The CEO was indicating the products in question were linked to the company's culture. The accountant could have still convinced the CEO to delete the products but needed first to communicate that they understood the emotion involved and how the client's employees would feel about the change. A is incorrect because the client wasn't using emotion to overrule something, they were showing their point of view. C is incorrect because the question doesn't say the client had not accepted their situation. D is incorrect because this question is not about differences between company size and we don't know what size the company is.

Water is an important dwindling resource and requires key disclosure commitments by organisations to help stakeholders understand its importance and contribute positively to water sustainability efforts. Which of the following action plans enables an organisation to have a clear economic incentive to closely assess their relationship to their water inputs and outputs and to proactively address and manage them? A Prioritise government bodies only for water risk assessment. B Integrate water issues into strategic business planning and governance. C Measure the company's water footprint at the beginning of the value chain. D Establish an enabling policy environment and invest in infrastructure and other public goods and services.

B is correct because integrating water issues into strategic business planning and governance is a key action plan for corporates on water. A is incorrect because organisations should engage a range of key stakeholders (e.g. local communities, NGOs, government bodies, suppliers, employees) as a part of the water risk assessment, long-term planning and implementation activities. C is incorrect because measure the company's water footprint (i.e. water use and wastewater discharge) throughout (not just the beginning) its value chain. D is incorrect because it relates to key stakeholder contribution by government bodies at the national, state and local level.

A wide range of media and tools can be used to communicate within an organisation or with external audiences. Which form of media communication is most suitable to interact and engage with a larger group across geographic location for internal meetings? A Targeted email B Online conferencing C Blogs and social media D Face-to-face presentations

B is correct because online conferencing using audio, video or web-conferencing technology is suitable for a larger internal group meeting across geographic locations. A is incorrect because targeted email is used for general distribution in a short time frame and difficult to engage in discussions with relevant stakeholders. C is incorrect because blogs and social media (e.g. Facebook, Instagram and magazine mobile apps) are used for increased engagement with the audience instead of having important internal discussions. D is incorrect because face-to-face presentation is suitable for a group or individual in a single location, where timing is critical or the communication would benefit from being interactive/a discussion.

A company is undergoing a cultural backlash, shown through disastrous employee survey results. The CEO was disturbed by the results and she brought together the management team to run a series of workshops. From these workshops, the CEO and her team learnt a lot about the style of some of the senior leaders, in particular, how they went about communicating to influence. Employees in the workshops consistently gave feedback that they felt managers saw them as objects to be manipulated, and used this tactic to try and influence. However, all this did was destroy credibility and show those managers to be socially inept. Which of the following communication techniques is this situation referring to? A The slime effect. B Metamorphic effects. C Encoding the message. D Rationality acceptance.

B is correct because people who seek to influence through seeing others as objects or pawns to be manipulated and played off against each other relates to metamorphic effects. The common outcome is that those influences damage any relationships that they have with others and their methods are seen for what they are (even though they may think they aren't). They are often seen as socially inept and unable to relate to others. A is incorrect because this is more about managing up and then managing differently down. C is incorrect because encoding the message is about the communication model and not related to this question. D is incorrect because this is not a communicating to influence technique.

Germany's Daimler Benz and America's Chrysler merged in 1998 and it was a bit of a disaster. One of the key issues was a cultural class and difficulty in communications between the companies as they tried to come together to be the largest automotive manufacturer in the world. Numerous examples of issues included the Germans feeling intimidated by the "in-your-face" expressive body language style of the Americans, ranging from arm-waving aggression to back-slapping friendliness. Which of the following non-verbal communication methods did the Germans find difficult to deal with? A Kinesics. B Proxemics. C Vocal qualities. D Physical kinetics.

B is correct because proxemics is about messaging delivered through personal space. Germans keep a greater personal space than Americans. They don't use fast moving gestures of body parts close to others to make a point. They don't physically touch each other with examples like backslaps to express warmth. They found this difficult to adapt to when the Americans took this communication approach. A is incorrect because although this is similar to proxemics, this is more about the use of facial expressions and other body language that may not involve changing people's personal space. The question describes the lack of personal space the German's felt which is about proxemics. C is incorrect because use of voice is not described. D is incorrect because this is not a definition of non-verbal communication.

Although good intentions are important when trying to develop a social venture that is sustainable from both a social and economic perspective, this is not enough. Sometimes people do not approach social ventures with the same level of rigour as they would a business enterprise, because there is a lot of goodwill and enthusiasm involved. Accountants can be valuable advisers here because they use systematic tools for ensuring a venture is set up to run successfully. One key aspect is to ensure the right people are available and trained to do the work that is involved, and that there is good succession planning to replace people as they leave. Based on Dees' 4 step process, which step does this relate to? A Step 1. B Step 2. C Step 3. D Step 4.

B is correct because step 2 refers to devising a human resource outline to meet each of the capabilities needed by the social enterprise. Step 1 is focused on defining capabilities, Step 3 is resource planning for things like money, time and expertise, and Step 4 focuses on financial planning.

When the Cambridge Analytica scandal hit the news, many people questioned Facebook's strategy and how it interacted with its customers. Investors, ex-employees, government, customers and community groups began to challenge the notion of whether Facebook had a social licence to operate. Which of the following does this concept form part of? A Agency theory. B Legitimacy theory. C Nexus of contracts. D Stakeholder theory.

B is correct because the concept of a social licence to operate comes under legitimacy theory.

Huiling had recently taken over the CEO role at a large engineering services company that was performing poorly. She spent her first months assessing everything from inventory levels in their spare parts warehouse, to workshops and coffees with employees to get their views on cultural issues. Huiling identified leadership styles as a key issue in the company and that too many managers were not holding employees to account, even if they scored well on 360 degree feedback surveys. Staff reported that quality issues raised were not actioned by management, but that even if a project ran late, the end of month lunch time barbeque didn't. Huiling knew she had some difficult conversations to have in the coming weeks but some of the managers must be sacked. Which one of the following types of leadership styles was Huiling aiming to remove from the company? A Team manager. B Country club manager. C Impoverished manager. D Authority-obedience manager.

B is correct because the leadership style known as country club manager, is one where the person has a high concern for people (therefore likely to be get good feedback survey results) but low concern for production or outputs. A is incorrect because the team manager style is the one Huiling would like to have. C and D are incorrect because an impoverished manager or authority-obedience manager has a low concern for people.

A budding entrepreneur developed a protein drink called POD. This drink was designed to help people recover faster from exercise and improve performance. It was different to many other products in the market because it was not a milk-based product, and the protein used had a unique chemical structure. Having created several batches and trialled and tested this with customers, and having sold it to several convenience store retailers, the next step was to increase the size of the production runs and determine if the product could be made using mass production techniques. Which stage of funding is this entrepreneur likely to require at this point? A Seed. B Start-up. C Early growth. D Established.

B is correct because the start-up stage is where strategies are put in place to scale the business. In this case, scale means moving from small batches of production to large scale manufacturing, and also increasing the scale of the distribution network. The other options (seed, early growth and established) are not linked to this scaling up stage. Seed funding is linked to earlier stages of discovering customers and developing the product, but this has already been achieved. Early growth is when the scaling has occurred and focus switches to developing systems to grow the business. Established refers to when corporate management and financing is required.

Which of the following correctly describes requirements relating to accounting for natural capital in financial reporting? A All ASIC registered companies in Australia must account for natural capital. B There are now disclosure requirements related to natural capital relating to companies listed on the ASX. C Integrated reporting doesn't require the coverage of natural capital however, this is under review and may change. D The director's report must now provide information relating to the financial impacts of non-compliance with environmental regulations.

B is correct because this is a recent change where there are now some disclosure requirements for companies listed on the Australian Securities Exchange (ASX). A is incorrect because it is not a mandatory requirement for all companies registered on ASIC's database. C is incorrect because natural capital is one of the pillars of integrated reporting and is required to be covered by organisations that use IR. D is incorrect because although good practice, the director's report does not have to address the financial costs of non- compliance with environmental regulations.

In relation to the chain of events for advisory services, which of the following is related to making sure the process is timely so that inaction or delays do not become an excuse to not implement? A Recommended action. B To follow the recommendation. C To actually follow the recommendation. D To monitor progress or outcomes of the implementation.

B is correct because this is referring to the description in the question as per the chain of events for business advisory services as per Figure 1.2. A, C and D are all relevant steps but are describing different actions.

A key issue for organisations is maintaining current knowledge resources. To support teams in their business as usual work processes and procedures are developed and shared with team members. A common problem in organisations is that when existing staff become familiar with the process they stop referring to the documentation. Over time changes occur in systems and the associated processes undergo changes. Process documents become out of date and are then not used by teams. Which one of the following knowledge-sharing processes is focused on overcoming this problem? A Knowledge audit. B Knowledge maintenance. C Use and leverage knowledge. D Share, transfer and deliver knowledge.

B is correct because this process refers to building knowledge governance accountabilities into the day-to-day processes of the organisation. A is incorrect because this refers to a review of the knowledge that exists and is stored in an organisation. C is incorrect because this refers to using the knowledge. D is incorrect because this refers to the identification and use of knowledge sharing tools and processes.

Hybrid models of work have become more common since the COVID-19 pandemic. Based on an assumption that less employees will attend the office, and that those who do will attend less frequently, many organisations are now introducing hot desking, with employees no longer having their own desks, and not sitting with the same group of coworkers each day. Which one of the following is a potential negative impact of hot desking on employees? A Employees need to set up a desk each time they attend the office. B Employees can feel disconnected due to the lack of their own space. C Collaboration hubs set up in areas traditionally used for employee desks. D Hot desking is generally used for hybrid teams with employees choosing when to attend the office.

B is correct. Studies have found that not having their own desk or familiar people around them can cause a loss of motivation. A is incorrect because this is not shown to have decreased productivity. C is incorrect because this does not affect focus during the work day. D is incorrect because hot desking is used for both hybrid and non-hybrid teams and this form of flexible work has been shown to increase productivity.

Alicia Claymore has managed the administration system used by her team for eight years. During this time the organisation has undergone two restructures, which have seen large numbers of staff made redundant, and Alicia has had four different managers. Alicia takes pride in her willingness to help team members understand and navigate the administration system. While Alicia was on annual leave the team needed to carry out an unexpected task using the system and were unable to find process documents to guide them. As the task was urgent two members of the team worked out a way to do the task and were able to meet the deadline. When Alicia returned from leave her manager explained what had happened and asked Alicia to share the process documents so that this issue would not happen again in the future. Which one of the following is not correct regarding Alicia's knowledge sharing? A Alicia shares her tacit knowledge by helping team members understand and navigate the administration system. B Important business activities are put at risk due to Alicia withholding the process document for the administration system. C The support Alicia has given the team by helping them understand and navi

B is correct. The task was able to be carried out in Alicia's absence. A is incorrect because tacit knowledge is the knowledge gained through personal experience and context. By supporting team members to understand and navigate the system Alicia is sharing her unique knowledge. C is incorrect because the team had learned from Alicia's tacit knowledge and were able to problem solve and find a solution in her absence. D is incorrect because organisations that are in a state of change can create anxiety for employees.

In 2022, 94% of organisations were using cloud computing. The pandemic has been described as a catalyst for accelerating the move to cloud computing. Which of the following is a benefit of the move to cloud computing for a small accounting firm? A Automation of workflow. B The opportunity to introduce hybrid work models. C Cost savings from a result of not requiring IT services. D Cost savings on office space as staff and clients do not need to meet as all informationcan be shared in the cloud.

B is the correct answer because the ability to access everything from anywhere enables workers to work remotely with the same efficiency as in the office. This enables hybrid work models. A is incorrect because cloud computing is different to workflow automation. C is incorrect because IT support is still required, it may be included in cloud computing costs or separately. D is incorrect because compliance work becomes automated the relationship between accountants and their clients is increasingly important to be able to add value to a client's business.

Which one of the following training delivery methods would be most effective for a team comprising staff from low power- distance, collectivist high power-distance, and individualist cultures? A A workshop-style approach with group exercises and discussion facilitated by the trainer. B An online training module with pre-recorded lectures and quizzes to test understanding. C A program that provides a blend of self-guided learning resources and facilitated group sessions. D A lecture-based approach that allows for little interaction with the trainer or among team members.

C is correct as it provides a blend of self-guided and facilitated training which addresses the different learning styles of the groups. A, B and D are incorrect as they each meet the needs of one group only.

Some of the main uses of public social media services by businesses are in marketing, public communication and targeting potential investors for funding. Which of the following options is a professionally oriented platform that can be used to pitch an entrepreneurial idea to potential investors? A Twitter B Facebook C AngelList D Wikipedia

C is correct because AngelList is a digital platform designed to bring together start-up businesses, investors and jobseekers with suitable skills for start-ups. A and B are incorrect because they are consumer platforms and typically provide social updates rather than pitching investments to a targeted professional audience. D is incorrect because it used for expertise sharing, building up a knowledge base or reference work over a period of time.

Which one of the following statements regarding workforce participation in Australia in 2022 is correct? A Overall, more women work part-time than full-time. B New appointees to ASX boards are more likely to be women than men. C There are more men overall, but more women work part-time than men. D Among people aged 15 to 64 years, more women participate in the workforce than men.

C is correct because although overall workforce participation is 71.0% for men and 60.6% for women, women make up 68.5% of all part-time employees. A is incorrect because 25.4% of all employed persons are women working full-time, but only 21.6% are women working part-time. B is incorrect because women comprised 45.4% of new appointments to ASX 200 boards, but men made up 54.6%. D is incorrect because the workforce participation rate for this age group is 73.5% for women and 82.9% for men.

Which of the following best describes why the agile approach to project management can be advantageous compared to the traditional approach? A The traditional method requires such high detail that projects run slower and are more costly. B The provision of open timelines and budgets enables project teams to fully establish resource needs. C The agile methodology de-emphasises methodology over being nimble and adapting to constant change. D The use of continuous waterfalls enables project teams to stay focused on one deliverable while keeping across the broader objectives

C is correct because being agile is about being flexible or nimble and being able to adapt. A is incorrect because agile projects are more likely to be higher in cost due to the open timelines and less restricted budgets. B is incorrect because open timelines and budgets often make it difficult to accurately establish resource needs. D is incorrect because this is a invalid description of a waterfall approach to project management.

The Chartered Global Management Accountant (CGMA) business model framework is designed to help identify how different aspects of a business model create value for the business. The CIVIC Trust was developed by the City of London Corporation to act as a compass for businesses on their trust journey. Which of the following principles relates to being transparent? A Value to society B Interest of others C Clear communication D Competence and skills

C is correct because being transparent relates to clear communication principle. In addition, other factors include being open, responsive and accountable too. A is incorrect because value to society principle involves recognising and meeting wider societal needs. B is incorrect because the interests of others principle involves taking account of and respecting the interests of customers, employees, investors and other stakeholders. D is incorrect because competence and skills principle relates to being capable and doing what you do well.

From 1990 to 1999, Southern Pacific Petroleum (SPP) promoted itself to investors, potential customers and governments as being able to use technology to extract and produce shale oil in a more environmentally friendly way. When a pilot plant was established and began operations, the community immediately complained about unpleasant odours, resulting in the plant being shut down. In response to negative sentiments, SPP began participating in local forums, attending local events and included the agriculture sector and began to address their concerns. Which of the following represents good stakeholder management practice? D Maintain separate communication approaches to different stakeholders. B The need for a compensation scheme to reward local community for positive reviews. C The need for internal commitment of management and employees to CSR and the appointment of a CSR champion. D Focus on the initial stages of the company's stakeholder management plan and only perform ad-hoc engagement sessions going forward.

C is correct because having a CSR champion is important to drive stronger internal commitment of management and employees to CSR practices. A is incorrect because organisations should maintain a consistent communication approach to different stakeholders as this would help build up positive business credentials. D is incorrect because to ensure stakeholders are not being disengaged, it is important for a business to perform ongoing and broad stakeholder identification, prioritisation and management.

Government measures directed at reducing carbon dioxide emissions will affect firms depending on their size (e.g. revenues, number of plants), industry and other characteristics. Which of the following impacts is a potential result of implementing emission trading schemes (ETS)? A Reduced cost of capital. B Reduced market depth and liquidity. C Preserve the relative competitiveness of industry. D An overall increase in employment opportunities across industries.

C is correct because it is a critical aim for countries that implement an ETS scheme and particularly organisations that are energy intensive. A is incorrect because uncertainty about the real impact of an ETS on the economy may increase the cost of capital, which may slow down innovation and growth in the emerging low-carbon industries and technologies as well as existing businesses. B is incorrect because an ETS is to ensure that the scheme has international linkages to encourage market depth and liquidity. D is incorrect because in the long term, low-carbon innovation is expected to generate widespread opportunities for economic growth and increased employment in some industries, and decline in others.

Communication will always involve some inherent risk which may lead to potential legal implications if not handled properly. Which of the following relates to the legal implications or inherent risk for communication? A Legal implications applies to external communication content only. B It is important not to disclose personal email addresses to people outside of your own organisation. C According to Section 254 of the Crimes Act 1958 (Vic.), there is no time limit for communication retention (e.g. emails, phone messages etc.). D According to Section 254 of the Crimes Act 1958 (Vic.), document destruction in the State of Victoria may lead to a year of imprisonment or a major fine.

C is correct because no time limit for retention is specified in this Act - relates to any legal proceeding, including one that 'may be commenced in the future'. This law effectively requires businesses operating in Victoria to archive all email messages and other communications. Similar legal requirements exist in other jurisdictions. A is incorrect because legal implications apply to both external and internal communication content. B is incorrect because most jurisdictions have privacy laws that will restrict the use and publishing of personal information of staff, customers and others within an organisation and to external parties. D is incorrect because according to Section 254 of the Crimes Act 1958 (Vic.), document destruction in the State of Victoria may lead to five years imprisonment or a major fine.

With an increasingly changing business landscape, accountants need to partner with others to provide the high level strategic advice that clients are seeking. This is already being seen through recruitment changes in the workforce - for example, large accounting firms are hiring non-accountants at an annual growth rate of 20%. Which one of the following areas of advice is most likely influencing these factors? A Risk management. B Project management. C Leveraging technology. D Sustainability business development.

C is correct because technology is the area that is having one of the greatest impacts on a changing business environment, and therefore changing areas of strategic advice. Accountants don't often have the tech skills to deliver this so they need to partner with others. But large firms have moved faster by increasingly employing non-accountants to drive their technology development. A, B and D are incorrect because they are all relevant areas of advice but are not the area that is having the greatest impact.

A variety of biodiversity issues such as climate change, loss of habitat through development, introduction of foreign species and an increasing human population have compounded the threat to impacted species. The introduction of alien species as part of production processes can pose a major risk to biodiversity. Which of the following industry sectors is mainly attributable to the major risk mentioned? A Mining B Oil and gas C Agriculture and biofuels D Electricity generation and supply

C is correct because the introduction of alien species as part of production or pest management systems is a major risks posed by the agriculture and biofuel sector. The remaining options are incorrect as those industry sectors have other main factors that contributes as major risks to biodiversity.

Mary Moss is the corporate training manager at a large telecommunications company. The company comprises five major business units, each with its own training group. Mary is keen to develop a Community of Practice for all of the trainers across the company, to support them in their work and to encourage knowledge sharing. Which one of the following sets of knowledge-sharing processes and technologies would be the most suitable to support this CoP? A Podcasting, blogs, knowledge maps and meetings B Document libraries, conferencing, microblogging and mentoring C Online forums, microblogging, document collaboration and meetings D Face-to-face training, newsletters, interactive learning and knowledge cafés

C is correct because the suggested processes and technologies for a CoP are wikis, (document sharing and collaboration), communication tools such as forums, microblogging and face-to-face meetings of the community. A is incorrect because podcasting, blogs and knowledge maps are not included in the recommended list of the most important processes and technologies. B is incorrect because document libraries are not as important to a CoP as document collaboration. Conferencing and mentoring are not included in the recommended list of the most important processes and technologies. D is incorrect because these tools are not included in the recommended list of the most important processes and technologies.

High net worth individuals have excess cash, excess egos and enjoy investing in businesses where they can aim for a minimum 20% return. They often bring specific expertise in a specific area to help the company grow, but they aren't interested in being involved for 15 years. Which type of start-up funding does this person provide? A Crowdfunding B Private equity C Angel investing D Venture capital

C is correct because these types of investors are known as Angel investors. A, B and D are incorrect because they describe different types of investors who have different wants and needs from Angel investors.

Colin McKenzie is a senior finance officer at Highlander Insurance, a successful general insurance company in New Zealand. He is recruiting externally for a new position in his department. Colin is aware that a global insurance provider is considering acquiring Highlander Insurance, but if this happens, it will be twelve months before this is finalised. As yet, there are no indications of the potential acquirer's plans for Highlander, but it is likely that some departments may merge, and that there could be some job losses. Considering this situation, which one of the following statements would be the most appropriate for Colin to include when describing the job to candidates? A We can guarantee this position as it is for the next twelve months, after which time there may be some changes. B Highlander Insurance is subject to an imminent takeover bid, but the ongoing success of the company is assured. C The organisational structure is likely to remain stable for at least 12 months, but changes often occur in a globally competitive business. D Highlander Insurance has a strong track record, and we expect the company to maintain a leading market position for the foreseeable future.

C is correct because this honestly states the situation without giving too much detail away. As any impact on the jobs in the department is not yet known, this is a realistic statement. A is incorrect because this is not a realistic statement. Although the potential takeover is not expected for twelve months, there is no certainty that the job can be guaranteed for that time, as other business changes may have an impact on this. To state that there 'may be some changes' is not a full and honest description of a possible takeover. B is incorrect because this is not a realistic statement. There is no evidence that the ongoing success of the company is assured. D is incorrect because this is not a realistic statement, as Highlander's future market position may be affected if the takeover eventuates.

Traditional measures of HR expenses have focussed on the costs of salaries and benefits, recruitment costs and costs associated with training and termination of staff. Contemporary reporting models, such as balanced scorecards and dashboards, add further dimensions to the costs of human resources. Which of the following additional measures provide insights into non-financial information about the value of an organisation's employees? A Fees paid to recruitment agencies. B Leave loading liabilities that relate to employees not taking leave. C Proportion of employee time spent undertaking administrative tasks. D Budget for conferences and training can be used to identify opportunities for cost savings.

C is correct because this measure is a non-financial one that focuses on whether operations are effective. It might be that toomuch resource spent on administrative tasks or too little. There is a cost link to this but it is not a traditional finance measure - the proportion of employee time. A is incorrect because fees are a direct financial cost. B is incorrect because leave loading liabilities are a direct cost measure, found in most expense reports. D is incorrect because although training is an important part of development we are talking about the budget associated with this which is a direct cost line item in a report.

You decided to set up a cooperative in farming called One Hundred Miles, with the aim of offering customers organic produce that travels less than 100 miles to get from the farm to the plate. Considering your new innovation business model, which of the following best describes how you might go about making this opportunity operational? A Merge with Carbon Farming Collective and use their existing blockchain network. B Approach the large supermarkets and fertiliser companies to fund your cooperative. C Join an incubator to access experts in logistics, marketing, law and other disciplines. D Request funding from a bank who need to fulfil their corporate social responsibility requirements.

C is correct because to set this up you need help from other experts in skill areas that you don't posses. One way to do this is to apply and (hopefully) join an incubator group. Incubators use the concept of crowdsourcing to help new businesses get started. A is incorrect because it might be great to merge with Carbon Farming Collective but your co-op is focused on your carbon footprint. B is incorrect because you are organic and so you don't probably want money from a fertilizer company, and supermarkets are situated everywhere and you can't meet your objective of 100 miles. You are also asking here for money, when you need crowdsourcing rather than crowdfunding. D is incorrect because banks generally don't lend to small cooperatives.

The Task Force on Climate-Related Financial Disclosures (TFCD) report noted that 'many organizations incorrectly perceive the implications of climate change to be long term and, therefore, not necessarily relevant to decisions made today'. It also pointed to a host of developments that 'could have significant, near-term financial implications' (TCFD 2018). Which of the following transition risks may result in write-offs and early retirement of existing assets? A Market B Reputation C Technology D Policy and legal

C is correct because unsuccessful investment in new technologies and making a transition to lower emissions technology can l ead to write-offs and early retirement of existing assets. The remaining options are incorrect. Refer to Table 4.4 of Study Guide for relevant potential financial impacts.

June is the accountant for Packing Co, a manufacturer of food grade plastic wrap products. The company has seen a decline in its net profit over the past three years. Sales revenue has increased significantly in the same period because the COVID-19 pandemic led to an increased demand for individually wrapped food products. Increased costs for electricity and increased commodity prices have impacted the profitability of the company. The CEO has asked June to advise how the company can increase its long-term profitability. Which one of the following best describes the advice that June would provide the CEO? A Undertake a supply chain analysis to identify key cost drivers. B Evaluate manufacturing processes to identify potential cost savings. C Undertake an analysis of the external factors impacting the industry to identify drivers of change. D Review the pricing strategy as part of the annual forecasting process to increase the profit margin.

C is correct. Climate change and environmental impacts are key effects of the plastics manufacturing industry and major contributors to costs. Energy price volatility, government policy changes to reduce carbon emissions are both significantly affecting input costs for businesses. A is incorrect as this is only one element of an external review. B is incorrect because this focuses on financial measures. A sustainable goal of manufacturing is to implement sustainable practices which generally has higher initial costs. D is incorrect as the focus on only financial measures provides a short-term solution.

The focus of HRM has moved away from the transactional approach of the past to a focus on being a strategic partner to the business. Which one of the following best summarises the benefits of this approach? A Managers can devolve recruitment and training functions to the HR business partner. B The HR business partner can embed a culture of ongoing learning and development to support staff in their career progression. C By identifying the current business needs the HR business partner can support managers to ensure recruitment focuses on finding staff who meet the current and future needs of the business. D The HR business partner develops a deep understanding of the current and future needs of the business and can develop HR plans that support teams to meet the strategic goals of the business.

D is correct as it best describes the function of the HR business partner in HRM. A, B and C are not correct as these describe elements of the HR business partner role but do not include the focus on the strategic elements of the role.

Many organisations pursue outsourcing or offshoring (or offshore outsourcing) to achieve cost savings or strategic benefits. However, they often move very quickly without enough careful consideration and many mistakes are made. This can include failing to deal with local stakeholders who are adversely affected by the change, and also carefully certifying the external organisation who will be providing the goods or services. A CPA Australia (2010) publication provides 11 steps that should be followed to guide successful implementation. Which of the following steps is the most relevant in relation to making sure there is a clear service level agreement that specifies prices and service levels that are to be maintained? A Step 5: Craft a careful risk mitigation strategy. B Step 6: Identify baseline processes and clearly defined interfaces before offshoring. C Step 10: Develop a sound offshore vendor selection process. D Step 11: Develop a complete contract.

D is correct because a complete contract needs to include pricing, but also performance and quality, full scope of costs and how staff and security will be dealt with. This is linked closely to establishing a SLA (service level agreement). Vendor certification is still important, but that occurs prior to contracting. The other steps are not directly relevant here (risk mitigation strategy and baseline processes).

The Task Force on Climate-Related Financial Disclosures (TCFD) report recommended including climate-related financial disclosures in the public financial reports, both to recognise that climate-related issues are potentially material issues and to help engage stakeholders with the associated risks and opportunities. A Markets B Energy source C Resource efficiency D Products and services

D is correct because a shift in consumer preferences, the development of new products or services through R&D and innovation, and the development and/or expansion of low-emission goods and services can provide opportunities for increased revenue. B is incorrect because this could reduce operational costs but will not increase revenue. C is incorrect because again, this could reduce operating costs but not increase revenue. A is incorrect because analysing markets enables an organisation to identify new markets and opportunities to diversify. But to deliver a better competitive position, organisations need to analyse their portfolio of products and services and identify new or existing products that will service change consumer preferences.

Which one of the following is not regarded as one of the reasons for the rise of the regulatory environment being a challenge for organisations? A The evolution of cross-jurisdictional standardisation. B A lack of clarity or stability of regulation of new business models. C Different regulatory regimes creating complexity in operational delivery. D The regulatory burden associated with moving to sustainable business models.

D is correct because although sustainability is important, this is not one of the four issues the study guide discusses as giving rise to the regulatory environment being a formidable challenge for organisations.

Which one of the following is the correct order for how we consider problem solving as a simplified process? A Idea development, decisions, evaluation. B Information and analysis, strategic decision-making, solutions. C Problem recognition and identification, idea generation, idea development. D Problem recognition and identification, problem definition, idea generation.

D is correct because as per Figure 1.12, these three are in the correct order. All other options are taken from the same figure but not in their correct order.

Gil Hamilton has been asked to assist with filling some vacant positions in the finance department in his company. He is comparing the benefits of recruiting internally or externally. Which one of the following statements best summarises the benefits of internal recruitment? A This approach will bring fresh perspectives into the team and improve loyalty. B It will access employees with unique work experiences, and will build relationships. C This will be a better option for access to specialised expertise and will build motivation. D It will be a cheaper option, and will access recruits with an established employment record.

D is correct because internal recruitment is usually less expensive, and will draw on existing employees whose employment records are well-established. A is incorrect, because although a company history of internal recruitment can build loyalty, it is external recruitment that will bring in outsiders with fresh perspectives. B is incorrect, because it is external recruitment that provides access to work experience not available from insiders. It is the use of networking tools such as Facebook that can build and maintain workplace relationships. C is incorrect, because although a company history of internal recruitment can build motivation, it is external recruitment that provides access to specialised expertise not available from insiders.

Organisations have increasingly disclosed information about their social and environmental performance and impact. To assist organisations, the Global Reporting Initiative (GRI) has established standards for sustainable reporting. In relation to supply chain management, which of the following describes how the GRI suggests organisations should explain specific procurement practices? A Reporting cost reduction strategies. B Outlining data quality improvement activities. C Describing approaches for minimising stock-outs. D Describing policies and practices used to select locally-based suppliers.

D is correct because it accurately describes one of GRI's management approach for SCM procurement practices. The remaining options are incorrect because they relate to existing traditional approaches of supply chain management.

The potential loss or exposure of data to hackers is a major reputational risk in the digital sphere. Deloitte's Online Risk and Digital Reputation Management Framework (Deloitte 2018) uses a number of approaches for managing digital reputation risks. Which of the following approaches relate to Deloitte's reputation management framework? A Ensure business data is made available to the public for transparency purpose. B Understand sentiment towards the organisation in the digital space by monitoring one digital channel only. C Disguising a coordinated public relations campaign to promote advantages of a business, policy or product, where little such support exists. D Setting up technology to scan the digital sphere for fraudulent or defamatory use of the business's name, logos, brands, and other intellectual property.

D is correct because it is one of the approaches described in Deloitte's reputation management framework (Deloitte 2018). A is incorrect because businesses should set up a secure, monitored technology architecture using firewalls, antivirus servers etc. to prevent unauthorised access to the business's data. B is incorrect because multiple (not one only) digital channels (e.g. Facebook, Glassdoor, Amazon, review sites, media websites) should be used to understand sentiment towards an organisation in the digital space. C is incorrect because it relates to 'astroturfing' practice (refer to Project Caesar Example 6.24 in Study Guide).

The use of accounting information and advice to include non-financial and operational data has accelerated over the last two decades. Which of the following methods uses tools such as activity-based costing and life cycle costing for environmental accounting analysis? A Balanced scorecard. B Global reporting initiative (GRI). C Physical environmental management accounting (PEMA). D Monetary environmental management accounting (MEMA).

D is correct because monetary environmental management accounting (MEMA) focuses on costs incurred and costs that may be avoided. Specific tools that are useful to achieving this include activity-based costing and life cycle costing. A is incorrect because the balance scorecard serves as a summary of performance against targets in those areas most crucially relevant to achieving the business's strategic goals. B is incorrect because the global reporting initiative (GRI) develops the framework for sustainability reporting as well as establishing the standards for global best practices. C is incorrect because physical environmental management accounting (PEMA) includes the use of tools to record material, energy and water flows, as well as incorporating physical amounts into budgets, forecasts and capital investment evaluations.

Energy consumption is important for many business activities and can be generated by using non-renewable and renewable types of energy resources. Which of the following relates to a type of renewable energy that uses photovoltaic cells to convert sunlight to electricity? A Coal B Biofuels C Hydropower D Solar power

D is correct because solar power refers to the use of photovoltaic cells to convert sunlight to electricity or the focusing of sunlight using lenses to create heat to drive turbines to create electricity. A is incorrect because coal is a type of non-renewable energy and used to provide heat in industrial smelters for the production of electricity supply. B is incorrect because biofuels are produced from organic matter and act as substitutes for fossil fuels. Bioethanol and biodiesel are examples. They can be produced from sugar and starch-producing plants (e.g. sugarcane), and from vegetable and animal fats respectively. C is incorrect because hydropower is power generated from the movement of falling or fast-flowing water to turn turbines, which produces electricity.

The original sharing economy businesses are now prompting the creation of other businesses to serve them. For example, Guesthop provides check-in, key delivery, cleaning and rental management to Airbnb hosts. Pillow handles pricing optimisation and many other services. Hotels are having to re-think their business models about which customers they target and what value proposition they offer because they cannot provide the 'homestay' experience of providers like Airbnb. Which of the following effects on the sharing economy is this related to? A Hurdles and deficiencies. B Social outcomes of the sharing economy. C The sharing economy as a business model. D Consumption and production consequences.

D is correct because the creation of new businesses that serve existing sharing economy businesses is an example of production outcomes. Hotels being forced to change their business models is an example of consumption outcomes because the customer has taken another offering that is different to what a hotel can provide. A is incorrect because it is not just a hurdle of deficiency, there are positive outcomes involved. B is incorrect because we are not discussing social outcomes in this question. C is incorrect because this a broader concept that is not describing the information in the question the way option D does.

Which of the following is correct about legitimacy, contingency, institutional and stakeholder theory? A Stakeholder theory considers how society is affected by the activities of a business. B Contingency theory is about delegating decision-making authority to the services of another. C Legitimacy theory relates to the power of employees to hold a their organisation to account. D Institutional theory assumes that all participants seek legitimacy within the institutional environment.

D is correct because the key assumption within institutional theory is that all participants seek legitimacy within the institutional environment. That is, in order to survive, organisations need to conform to the rules and belief systems that prevail in the environment, and this will earn the organisation legitimacy. A is incorrect because stakeholder theory is not about the whole of society but of a specific group of people affected by the organisation's activities. B is incorrect because this is explaining agency theory. C is incorrect because legitimacy theory is not about the power of employees.

Communicating to the audience in an appropriate manner is essential for reaching your objective. It helps to have a communication plan in place that lists the main objectives, the audience, the targeted outcome and even the budget and financial resources linked to the communication. When communicating, social entrepreneurs need to make sure they successfully engage the receiver. Which of the following does not describe a specific outcome of a successful marketing campaign in relation to social entrepreneurs? A Lifting B Keeping C Winning D Engaging

D is correct because the other three terms are discussed in the study guide. Winning describes acquiring new donors, or winning back lapsed donors. Keeping describes maintaining active donors. Lifting refers to moving current donors to a greater level of giving). Engaging is not a specific outcome that is listed.

Hart and Associates Accountants recently merged with Piper Partners Financial Advisory Services. The firms have the shared goal of expanding their client base and are looking to grow their revenue by offering expanded services to their existing client base. The partners are concerned that all the senior staff from both firms are from the same cultural background, while the junior staff are all from diverse cultural backgrounds. The partners have hired an HR consultant to help them understand how to create a high performing team. The consultant determined that staff were at the defence stage of acquiring cultural competency. Which one of the following would be the best way for the firm to build cross-cultural synergy? A Implement clear processes and guidelines for all work as a consistent approach is the best way to support managers to achieve the goals of the firm. B At the defence stage people have a fear of difference. The firm should implement a training program to help staff understand how cross-cultural teams operate. C To move beyond defence staff should be encouraged to view situations from the perspectives of staff from a different cultural background to enable them to work

D is correct because the senior staff are all from the same cultural background so to develop cross cultural synergy it is important that group have a shared understanding of the value created by cross cultural teams. Acquiring cultural competence is a gradual process that requires learning about other cultural perspectives and developing cultural awareness of others so it is important that all staff are engaged with the process. A is incorrect as this does not consider cross cultural synergies. B is incorrect because although training is important, cross cultural collaboration and synergy is developed through gaining an understanding of different cultural perspectives. C is incorrect as it does not address the two parts of the situation.

Which one of the following is correct regarding agency theory? A Organisational practices arise from the implied expectations in a social contract. B Organisational practices arise from considerations of stakeholders to create value. C Organisational practices arise from the need to adapt to consider external forces. D Organisational practices arise from the efficient organisation of information and risk-bearing costs.

D is correct because this is the description of the key ideas underpinning agency theory. A is incorrect because this is describing legitimacy theory. B is incorrect because this is describing stakeholder theory. C is incorrect because this is describing contingency theory.

Brian Chan is the CFO at Highprofit, a payroll company with branches throughout Australasia. The company is experiencing rapid growth as a result of businesses changing their operations to focus on their core products and outsourcing their non- core functions. To build capacity for increased business they are considering is considering introducing automation to manage routine processing activities. A large proportion of Highprofit's employees are employed in the data entry and reconciliation teams. The work is repetitive and these employees are generally unskilled in other functions due to the nature of the work. Brian is aware that introducing automation would mean that the work required would change significantly and that the number of staff required for the function would decrease. He also recognises that the deep knowledge of the processes sits within this team and needs to retain that within the business. Brian has been asked by the CEO to provide a recommendation regarding the introduction of automation. Which one of the following would be the best advice for Brian to give to the CEO? A The introduction of automation will position the company to gain greater market share. B The

D is correct. Automation relies on robust process design and testing of the proposed solution. Existing staff are best placed to provide the input and testing of a system. A is incorrect as there is no guarantee that the company will gain greater market share as this is dependent on a number of complex factors. B is incorrect because, although full implementation of automation would be a gradual process the reasons for this are complex and cannot be isolated to simply allowing employees time to find other roles. C is incorrect because although this is true it does not consider the perspective of the business.