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2021 - GAA I > 2 - King IV Principles 4 - 16 > Flashcards

2 - King IV Principles 4 - 16 Flashcards

1
Q

principle for strategy and performance?

A

4

  • the GB should steer and set direction for realisation of core purpose through strategy
  • should delegate to mgmt the development of strategy
  • should ongoingly oversee mgmt strategy implementation
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2
Q

principle for reporting?

A

5

  • GB should ensure that reports issued enable SH to make informed assessments of comp performance and s/m/l term prospects
  • company should issue integrated report at least annually and ensure the integrity of reports
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3
Q

principle for primary role/resp of the GB?

A

6

  • GB should steer org, set its strategic direction
  • approve policy and plans to give effect to that direction
  • oversee mgmt execution/impl of strategy
  • ensuring accountability for comp performance
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4
Q

risks associated with the BOD?

A
  • directors putting their ints above that of SH
  • conflicts of int
  • misuse of comp assets
  • inappropriate remuneration schemes
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5
Q

principle for composition of the GB?

A

7

  • balance of knowledge, skills, experience, diversity
  • majority independent NEDs
  • CEO and at least one other executive
  • periodic rotation of members
  • succession plan
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6
Q

duties of non-executive board members?

A
  • challenge and monitor CEO

- bring indie perspective to dec-making

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7
Q

independent non-executive board members?

A
  • no direct interest in company
  • not immediate family of an employee (or someone who was an executive in the last 3yrs)
  • not a professional advisor
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8
Q

how should the process of nomination, election and appt of GB members be?

A
  • formal and transparent

- look at diversity, skills, background check before nom

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9
Q

GB member reelection noms should be based on?

A
  • performance
  • attendance in previous meetings
  • approved by whole board
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10
Q

what should happen upon election of GB member?

A

the t&cs for serving as a director should be formalized in an appointment letter

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11
Q

what should happen after election of GB member?

A
  • induction
  • members with little to no experience should get training/mentor
  • professional development programme and regular CG briefings should be provided to all directors
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12
Q

recommendations for independence and conflicts of interest?

A
  • annually each member must declare their interests they hold
  • at start of each meeting, each member must declare any conflict of interest in an agenda matter
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13
Q

why is independence of NEDs important?

A

no interest will influence decisions made. will be made in comp’s best interests

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14
Q

when may a member not be independent?

A
  • significant capital provider
  • owns material value shares
  • executive mgr in past 3 yrs
  • audit team/ext auditor in past 3 yrs
  • significant/ongoing professional advisor
  • GB member of a significant cust/supp or related party
  • gets remuneration based on comp performance
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15
Q

board chair requirements?

A
  • iNED
  • not CEO
  • not retired CEO until 3 yrs past
  • should have succession plan
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16
Q

purpose of lead independent?

A
  • lead in absense of chair
  • intermediary between chair and members
  • strengthen board independence
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17
Q

principle for GB committees?

A

GB should ensure that its delegation arrangements promote independent judgement and effective duty discharge

18
Q

audit committee duties?

A
  • meet annually w audtiors w/out mgmt
  • oversee assurance services
  • ensure AFS integrity
  • dedicate sufficient time to the resp of risk governance if delegated by board
19
Q

role of the nominations committee?

A
  • evaluate BOD perf
  • examine skills needed for BOD candidates
  • nom, elect, appt board members
  • succession planning
20
Q

minimum members in each comm?

A

3

21
Q

comm meeting attendance?

A

every board member can attend if invited to observe, but can’t vote, participate (unless allowed), can’t get attendance fees

22
Q

audit comm members?

A

all iNEDs, incl chair (not CEO)

23
Q

noms comm members?

A

NEDs, mostly indie

24
Q

rem comm members?

A

NEDs, mostly indie

chair = iNED

25
Q

soc/eth comm members?

A

mixed NED / ED

mostly NED

26
Q

principle for evaluating GB performance?

A

9

  • ensure that the eval of its performance/comm perf/chair/member perf support continuous improvement in performance
  • should occur at least every 2yrs
  • lead indie evals chair
27
Q

the CEO should?

A
  • be appt by board
  • lead the implementation and execution of strategy
  • have succession plan ensured by board
28
Q

principle for appt and delegation to mgmt?

A

10: board should
- decide which powers are for itself and for mgmt
- ensure succession plans for executive mgmt
- ensure key mgmt positions are held by competent individuals

29
Q

company secretary should?

A
  • not be board member
  • be appt/removed by board
  • advise and guid the board on duty execution
30
Q

principle for risk governance?

A

11

board should govern risk in a way that supports the org in setting and achieving its strategic objectives

31
Q

principle for tech/info governance?

A

12

board should govern info/tech in a way that supports the org in setting and achieving its strategic objectives

32
Q

principle for compliance gov?

A

13

board should govern compliance with laws in a way that supports the org in being ethical/good corp citizen

33
Q

principle for remuneration governance?

A

14

remunerate fairly, resp, transparently to promote the achievement of strategic obj and positive outcomes

34
Q

voting for remuneration?

A

fees for NEDs must be submitted for approval by special resolution with two years preceding pmt.

35
Q

principle for assurance?

A

15

ensure assurance services enable an effective control environment and support report/info integirty

36
Q

role of the internal audit?

A
  • evaluate comp gov processes
  • analyze/evaluate bus processes/ctrls
  • provide info relating to fraud, corr, unethical behavior
37
Q

what should the board do in terms of assurance?

A
  • delegate oversight to audit committee

- ensure the int audit function has necessary skills and resources to address risk

38
Q

CAE (chief audit exec)

A
  • not be a member of executive mgmt, but should attend exec meetings by invite
  • approved appt/removal by board
39
Q

what should the board do when monitoring the internal audit?

A
  • ensure it follows risk-based audit plan

- reviews org risk profile regularly

40
Q

principle for stakeholders?

A

16

board should adapt a SH inclusive approach that balances needs/ints of all material stakeholders

2021 - GAA I (12 decks)

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