Section B: Corporate Governance, Controls And Corporate Social Responsibility Flashcards
Why are corporate governance rules required?
Because management need encouragement to act in the best interest of all stakeholders.
What is shareholder activism?
The level of involvement shareholder shave in the running of the company.
What is the purpose of the OECD principles?
Act as a benchmark to ensure that national codes all comply with generally accepted best practice
What structure does the UK corporate governance code recommend for remuneration committees of large companies?
There should be at least 3 NEDS.
Which UK report on corporate governance focused on the role of NEDS?
Higgs report
What structure does the UK corporate governance code recommend for audit committees of large companies?
At least 3 NEDS
The King Report on corporate governance is which country’s approach to corporate governance?
South Africa.
How many board memberships should a current FTSE100 executive hold?
Only 1
What measure did the Sarbanes Oxley act introduce?
Companies must have an audit committee to trade.
What is the most common board structure for UK companies?
Single (Unitary) Board.
What are 3 sections of the King Code of Corporate governance?
Governance of risk, IT & Integrated reporting
What is the title given to a NED whom shareholders can contact outside of normal channels?
Senior Independent Director
What is the primary responsibility of Ext Audit?
To report to shareholders on whether the clients financial statements are accurate and free from bias.
What are substantive tests designed to accomplish?
To identify errors and omissions in financial statements
The susceptibility of a transaction to material misstatement is known as?
Inherent risk.
