Assume you are the financial director of a public company which has been experiencing a decline in financial performance. At a board meeting it is being proposed that all directors and senior managers receive a substantial increase in pay and bonuses. One director has stated that the figures can be masked, legitimately, in the annual report and accounts.   It has also been proposed not to increase the dividend to shareholders, stating that the money is needed for essential investment. The company does have assets which are in need of replacement. What do you think about these proposals? Do they suggest good, bad, or indifferent corporate governance?

Q: Choose the correct. A company’s management has uncovered events that indicate that substantial doubt…

A: Financial statements: Financial statements are condensed summary of transactions communicated in the…

Q: Risk in the widest sense is not new to business. All companies are exposed to traditional business…

A: The process of recognising, assessing, and accepting or limiting uncertainty in investment decisions…

Q: J-Chron's board of directors periodically meets with the CFO of the company. The CFO reports on the…

A: Board of directors usually meet to discuss the performance of the company and to check compliance of…

Q: What has been the main thrust of recent changes in the financial reporting rules following the…

A: Correct answer is To improve internal control over companies' financial reporting.

Q: sume you are the controller of a large corporation, and the chief executive officer (CEO) has…

A: A debit memorandum or memo is a form or document, sometimes termed a debit memo invoice, that…

Q: Which of the following is NOT a corporate governance best practice? Question 8 options: Public…

A: Answer of Question 8:  Public company directors should hold meaningful amounts of stock as long as…

Q: Zama Brooks Ltd is a company that has been known to have bad results for the past three years. Our…

A: A takeover occurs when one company gets successful in biding to take control over another company’s…

Q: Which among the following statements is INCORRECT regarding agency costs? a. The reason for agency…

A: Agency problems exist when there is a conflict of interest between the management and the…

Q: The success of any organization heavily depends on the efficiency of the corporate governance. The…

A: Organization goal: The main goal of the organization is to maximizing the revenue along with…

Q: Which of the following actions would be likely to reduce potential conflicts of interest between…

A: option C is correct  The composition of the board of directors is changed from all inside directors…

Q: Hello I don't understand what this question? Many financial managers and corporate officers have…

A: I do not agree with this statement because this lacks a universal application. Good and bad people…

Q: Suppose you were a member of Company A’s board of directors and chairperson of the company’s…

A: Compensation Package: The compensation package of the manager should be attractive which inspire…

Q: Identify an example of a systematic risk faced by QANTAS Ltd. from the scenarios below.   Select…

A: Systematic risk is a very important concept in finance. It is that risk which is inherent to the…

Q: Several managers in your company are experiencingpersonal financial problems and have asked that…

A: Last-in-First-Out (LIFO): In this method, items purchased recently are sold first. So, the value of…

Q: Discuss the advantages and disadvantages of the following forms of managerial compensation in terms…

A: a) A Fixed salary: The advantages are static income not connected to profits and the drawbacks are…

Q: There is a conflict of interest between stockholders and managers. In theory, stockholders are…

A: Agency problem occurs when there is conflict of interest between the  agent (management) and the…

Q: What is one of the ways that accounting is used to direct and control the manager of a corporation?…

A: Accounting is referred to as a process under which the transactions of a company are recorded,…

Q: You are the CFO of Clarke Company, which is publicly traded. At the annual shareholders’ meeting,…

A: Shareholders represents the right of ownership to the organisation.

Q: Suppose you are the chief financial officer (CFO) responsible for the financial statements of Philip…

A: Stakeholder is the party which is interested in the company and could either affect or be affected…

Q: Chief executive officer compensation can be a material amount andis often scrutinized by regulators,…

A: “Since you have posted a question with multiple sub-parts, we will solve the first three subparts…

Q: Which of the following statements is TRUE about Lehman Brother’s board of directors before it went…

A: During the global financial crisis, Lehman Brothers, Bank based in United States of America went…

Q: ARISE CO. has suffered operating losses for some time, but is now operating profitably and expects…

A: Losses in this sum are :- (i) Fall in value of PPE (ii) Fall in value of inventory (iii) Unaccured…

Q: Suppose you were a member of Company X’s board of directors and chairman of the company’s…

A:

Q: The CEO of a firm is giving an annual statement in front of shareholders. The company sells two…

A: Introduction:- A company's CEO makes an annual statement in front of the shareholders. The firm…

Q: which of the following could be a potential solution to the agency problem between managers and…

A: Giving the managers a part of the company through stock-based compensation could be a potential…

Q: Which of the following are correct descriptions of large corporations? (You may select more than one…

A: The large corporations are that corporation that is registered as a company and have crossed the…

Q: (Treasury Stock—Ethics) Lois Kenseth, president of Sycamore Corporation, is concerned about several…

A:

Q: Independent directors are the agent and trustee of the company, their duties and responsibility…

A: Corporate governance is the way in which the company is operated and  it is controlled. It is about…

Q: Explain the likely reasoning the company president has in mind to support this statement.

A:

Q: Contingent situation is a potential negative event that may occur in the future, such as economic…

A: Companies and investors plan for various contingencies through analysis and implementing protective…

Q: Corporate management and the Board of Directors fulfil a vital role to ensure good corporate…

A:

Q: How would you know if all the necessary disclosures were prepared and contained correct information?

A: Introduction:   Accounting policy: Accounting policy can be defined as the rules, regulations and…

Q: Corporate governance explains the functions that are required to be performed by the board of…

A: One of the main functions to be performed by board of directors in Corporate governance is to review…

Q: The board of directors has which of the following responsibilities? I. Recommendation of dividend…

A: The Board of directors are elected by the shareholders to protect the shareholders interest,…

Q: Which of the following factors would weaken corporate governance? A.Ensuring that the rotation of…

A:

Q: You are the CFO of Clarke Company, which is publicly traded. At the annual shareholders’ meeting,…

A:

Q: Every annual report of a public company includes an extensive discussion and analysis provided by…

A: Definition: Annual report: Annual report is a comprehensive financial report which shows all the…

Q: Which of the following are true statements on the principal-agent problem between corporate managers…

A: The principal-agent problem occurs when there are conflicts of interest between the principal and…

Q: Sarbanes-Oxley Act of 2002 requires which of the following report to be prepared by the management…

A: The company can raise the capital for expansion or for purchase of capital asset by issuing shares,…

Q: You have just been employed as the new Chief Executive Officer of a medium-sized company that is…

A: Principal-agent relationship: It is the agreement between two parties, where one party(entity)…

Q: You are offered a job you know that accepting this job may eventually lead to a promotion into the…

A: Hello. Since you have posted multiple questions and not specified which question needs to be solved,…

Q: Which of the following methods would be most likely to decrease the agency problems by helping…

A: Agency problem takes place because there is no sync in the goals of shareholders and managers.…

Q: Suppose that the CEO of a firm has to make an annual report to shareholders about 2 of the divisions…

A: The question requires us to weigh segmental or divisional reporting vs integrated reporting. We need…

Q: If you are an IT auditor, then the management told you that one of their former employee was hired…

A: Auditor is the person who audits means he or she checks the financial statements of the company and…

Q: Suppose you were a member of Company X’s board of directors and chairperson of the company’s…

A: Answer: Any firm’s primary goal is to increase the wealth of shareholders. Maximizing shareholders…

Q: dentify the term being referred to: A theory that states that shareholders will encourage the board…

A: Solution Concept Dividend irrelevance theory                 The term Dividend irrelevance theory…