- 10 Marks
AA – May 2018 – L2 – Q2a – Professional and Ethical Considerations
Identifies corporate governance weaknesses in a company and provides solutions to align with good governance principles.
Question
Mr. Frimpong Dogbe is the Leader, Founder, Chief Executive Officer, and Board Chairman of Awurade Hwe Ltd. He single-handedly appointed a board of five executive and two non-executive directors. No formal performance targets are set for the senior managers in the company, and no review of board policies is carried out. Mr. Frimpong Dogbe is the one who sets Board salaries based on his assessment of all the board members, including himself, and not on their actual performance.
Internal controls in the company are monitored by the Senior Accountant, although detailed review is assumed to be carried out by the external auditors. Awurade Hwe Ltd does not have an internal audit department.
Required:
Describe FIVE corporate governance weaknesses faced by Awurade Hwe Ltd, which do not comply with corporate governance principles, and for each weakness, recommend a solution to overcome the weakness. (10 marks)
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