Ben Small, a sole practitioner, has just decided to form a law partnership with his lifetime friend, Harvey Steptoe. They agree to name the firm Steptoe and Small and to split all profits. Ben is also a director for a publicly-traded telecommunications firm, NewVector, Inc Ben has just learned that Harvey is lead counsel is a lawsuit against NewVector. Ben continues to serve as a board member and
participates in sensitive discussions about the lawsuit. Ben does not disclose that Steptoe is his partner. Ben's feeling is that he and Harvey are as honest as the day is long and neither would compromise their duties to NewVector and client, respectively.
a. Ben has a conflict of interest and must either resign as a director or leave the partnership.
b. The pledge of both Ben and Harvey is sufficient to cover the ethical issues on conflict.
c. It is Harvey's obligation to take action, not Ben's.
d. None of the above
.A
You might also like to view...
The expectations gap represents a misunderstanding whereby shareholders mistakenly believe that they are entitled to recover losses on investments for which the auditor provided an unqualified opinion on the financial statements
a. True b. False Indicate whether the statement is true or false
What are any four benefits to using milestones as a form of project control? What advantage do they hold over pure S-curve analysis?
What will be an ideal response?
PwC, one of the "Big 4" accounting firms, was involved in a scuffle with Russia's Federal Tax Service over one of its clients, Yukos. PwC did not want to turn over confidential information about its client. However, the failure to cooperate with the Federal Tax Service could result in the loss of its license to do business in Russia. What questions should other companies consider before expanding
their operations into countries in which they have never done business? a. Companies should consider the legal and cultural backdrops and customs in a country before undertaking expansion into that country b. Companies need to adapt to differing legal systems and simply comply with government requests c. Companies should turn to the International Court of Justice when country leaders and agencies are violating professional standards d. Companies should realize that doing business without engaging in bribery in certain countries is not possible
Since 70% of the preferred dividends received by a corporation are excluded from taxable income, the component cost of equity for a company that pays half of its earnings out as common dividends and half as preferred dividends should, theoretically, be ? Cost of equity = rs(0.30)(0.50) + rps(1 - T)(0.70)(0.50).
Answer the following statement true (T) or false (F)