Summary
Summary AUE2602 Assignment 2 2022- Solution
- Institution
- University Of South Africa (Unisa)
AUE2602 Assignment 2 2022- Solution
[Show more]
1 review
By: enja07 • 2 year ago
Content preview
AUE2602 Assignment 2022Question 1.1
a) Composition of the Board
Mr Scott the CEO Is not the Chairman of the board which is in compliance with King IV.
The board does not comprise a balance of power executive and non-executive directors; there
is only three non-executive director to 5 executive directors. There should be a majority of
non-executive directors and the majority of the non-executives should be independent.
The board should set a balanced targets for race and gender representation in its
membership. There is only 2 females in the board of 8 memebers therefore non compliant to
King IV.
The board should be assisted by the nominations committee when appointing new
directors. Ms Grey has announced her retirement from her position as CFO and has
recommended that Mr Rhodes, the financial manager should take over her position on the
board, which the board accepted. This in not compliant to King IV.
There are no independent non-executive directors: All non-executive directors are members
of audit committee and the likes of Kandasamy and McCoyy have direct dealings with Book
Marked. Therefore he cannot be considered as independent.
The chief executive officer and at least one other executive should be appointed to the board.
The board complies as it has both have Mr Scott the CEO and Ms Grey and others which are
executive directors.
, b) Chairperson of the Board
The King IV Report recommends that the chairperson should be an independent non-
executive director. Mr Adofo owns 7% of the equity interest in Book Marked yet he is the chief
executive officer (CEO).
The chief executive officer should not be the chairperson. Mr Adofo is the chairperson of
the board and he is not the CEO of the board therefore complies with King IV
former CEO should not be elected as chairperson until three complete years
have passed since the CEO vacated his position. Mr Adofo was appointed in less than 3 years
of being a CEO of the company. He was 2 years and 11 months only, which is below the 3
year requirement, therefore non-compliant to king IV.
c) Audit Committee
The audit committee should consist of at least three members. The committee has Messrs
Stryker, Kandasamy and McCoy as committee members therefore complies with King IV.
Each member must be a non-executive (King IV) director of the company.
Messrs Stryker, Kandasamy and McCoy being members of Auidt committee are all non-
executive directors therefore complies with King IV
Each member must not be a material supplier or customer of the company, such that a
reasonable and informed third party would conclude that in the circumstances, the integrity,
impartiality or objectivity of that member of the audit committee would be compromised.
Mr Kandasamy’s purchases for his bookstore amount to 15% of Book Marked’s revenue which
non-compliant to the above recommendation of King IV.
d) Nominations Committee
The board should establishing a nominations committee to oversee nomination, succession
and evaluation of the board performance. There is nminations committee therefore complies
with King IV.
All members of the nominations committee should be non-executive directors. Mr Scott is the
CEO there is not compliant with King IV as he is an executive director.
The majority of members are not independent non-executive directors as required by King IV.
The chairperson of the should be a member of the committee and may be elected as chair.
Mr Adofo is not a member of the nominations committee therefore no compliant with King IV.
Question 1.2
1.2.1
Ubuntu means there should be a common purpose by both individual and corporations which
should be directed towards service to humanity.
1.2.2
The initiative to build a school and serve books would to a greater extent considered as
ubuntu. This is due to the no economic benefit the company will get in return and the service
this will serve to the humanity in the form of education facility to the society.
Question 1.3
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller vindiesel30. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R200,00. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
53022 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy summaries for 14 years now