Avengers Limited (Avengers) is a large distributor of consumer goods, general merchandise. home improvement equipment, and...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Avengers Limited (Avengers) is a large distributor of consumer goods, general merchandise. home improvement equipment, and a wholesaler of basic foods in South Africa. Avengers' governance structure consists of the Board of Directors, assisted by four committees (namely the Audit Committee, Remuneration Committee, Risk Governance Committee and Nominations Committee). Avengers Board of Directors, as at 29 February 2021, consisted of the following individuals: Director Mr Hulk Mr Thor Mr Black Panther CA(SA) Mr Hawk Eye Mr Iron Man Mr Captain America Ms Black Widow Mr Spiderman Notes 1 & 2 2&3 2&7 2 & 4 5 & 8 6 & 8 8 2. Position Chairperson Chief Executive Officer (CEO) Chief Financial Officer (CFO) and Company Secretary Chief Operations Officer (COO) Director Human Resources Non-executive director Non-executive director Non-executive director Age Years in position 55 57 57 56 55 61 46 63 13 14 20 15 15 6579 17 1 19 Notes 1. Mr Hulk owns 15% of the equity interest in Avengers and was appointed as the chairperson of the board by all the members of the board at the meeting on 1 August 2007. Mr Hulk served as the CEO of Avengers until 1 July 2007. He also served as the chairperson of the Audit Committee of Avengers for a number of years. Messrs Thor and Hulk have been friends since their school years. They form part of the so- called "Superhero Club" (a name they earned while at school); Messrs Black Panther, Hawk Eye and Iron Man also belong to this club. 3. Mr Thor was appointed to the position of CEO of Avengers on 1 July 2007 by Mr Hulk and he served as a member of the Audit Committee of Avengers for a number of years. Mr Thor and Mr Hulk are the two members serving on the Audit Committee. 4. Mr Hawk Eye plays a significant role in the day-to-day management of Avengers as the COO. 5. Mr Captain America is the CEO of one of Avengers's significant suppliers. 6. Ms Black Widow serves on the boards of ten other companies from various industry sectors; and the Board of Avengers believes that it makes her a valuable asset to the group of companies. 7. Mr Black Panther informed the board of a possible contract relating to the import of retail stock. He was recently approached by an overseas company who indicated that there would be huge savings in store for Avengers. They also mentioned that they would make it worth his while if he assisted them in winning the contract. He had done some research on the company and found out that they are also involved in litigation relating to pollution at their manufacturing plants. He did not accept the contract. 8. Messrs Captain America, Black Widow and Spiderman are the three members serving on the Nominations Committee. The chairperson of the Remuneration Committee, Ms Black Widow, announced that she would resign as chairperson next month. Revenue and receipts - internal control You are a registered candidate auditor at an auditors firm. Your firm has been engaged to evaluate Avengers' internal control systems and you have been assigned to the revenue and receipts cycle. Ben Dekker, the financial accountant of Avengers is of the opinion that the application software is poorly designed and does not make satisfactory use of programmed controls. He informs you that the company is experiencing a number of problems in the cycle including the following: inaccurate and incomplete internal sales orders and picking slips being created. Revenue and receipts - community project As a corporate citizen, Avengers assisted a community bakery to register as a company, sell their goods in the canteen and expand their business. The bakery, registered as Bakeacake (Pty) Ltd, now manufactures a range of biscuits and small cakes that it sells to supermarkets, street vendors and the Avengers canteen. The newly appointed manager of Bakeacake has asked your firm to review the systems within the company that deal with cash. You have been provided with the following information: From Monday to Friday between 07h00 and 09h00, street vendors can purchase biscuits and cakes from the "vendor shop" which is attached to the factory. The vendor shop is run solely by Ted Baker, an employee in the factory administration department. Sales are made only for cash. Cash received is placed in a large metal cashbox. If the vendor requests a receipt, a pre-printed numerically sequenced two-part cash receipt is made out by Ted Baker. He closes the vendor shop at 09h00, takes the cashbox with him and returns to his office in the factory. Before opening the shop on Monday mornings, he leaves the cash from the previous week's sales (in the locked cashbox) on the desk of the senior bookkeeper Cookie Oates. Only Cookie Oates and Ted Baker have keys to the cashbox that is used in the shop. : Social media Mr Thor expressed the view that the use of social media in Avengers is rapidly growing as it is becoming more pervasive and impacting many parts of the business. He requested that your auditing firm should explain the social media exposure risks and the good practices that can be incorporated to prevent a social media crisis. 1.1 Evaluate the corporate governance practices of Avengers according to the principles and practices of the King IV CodeTM. You should state the relevant recommended practice and discuss issues relating to compliance and non- compliance with the King IV Report in your answer. Limit your discussion to the information provided in the scenario. Present your answer under the following headings: a) Governing body (Board of Directors): Composition of the board (seven b) comments) Governing body: Chairperson of the board (three comments) Audit Committee: (five comments) Nominations Committee: (one comment) Company secretary: (one comment) One presentation mark will be awarded if the answer is presented under the correct headings (10.5) (4.5) (7.5) (1.5) (1.5) (1) Avengers Limited (Avengers) is a large distributor of consumer goods, general merchandise. home improvement equipment, and a wholesaler of basic foods in South Africa. Avengers' governance structure consists of the Board of Directors, assisted by four committees (namely the Audit Committee, Remuneration Committee, Risk Governance Committee and Nominations Committee). Avengers Board of Directors, as at 29 February 2021, consisted of the following individuals: Director Mr Hulk Mr Thor Mr Black Panther CA(SA) Mr Hawk Eye Mr Iron Man Mr Captain America Ms Black Widow Mr Spiderman Notes 1 & 2 2&3 2&7 2 & 4 5 & 8 6 & 8 8 2. Position Chairperson Chief Executive Officer (CEO) Chief Financial Officer (CFO) and Company Secretary Chief Operations Officer (COO) Director Human Resources Non-executive director Non-executive director Non-executive director Age Years in position 55 57 57 56 55 61 46 63 13 14 20 15 15 6579 17 1 19 Notes 1. Mr Hulk owns 15% of the equity interest in Avengers and was appointed as the chairperson of the board by all the members of the board at the meeting on 1 August 2007. Mr Hulk served as the CEO of Avengers until 1 July 2007. He also served as the chairperson of the Audit Committee of Avengers for a number of years. Messrs Thor and Hulk have been friends since their school years. They form part of the so- called "Superhero Club" (a name they earned while at school); Messrs Black Panther, Hawk Eye and Iron Man also belong to this club. 3. Mr Thor was appointed to the position of CEO of Avengers on 1 July 2007 by Mr Hulk and he served as a member of the Audit Committee of Avengers for a number of years. Mr Thor and Mr Hulk are the two members serving on the Audit Committee. 4. Mr Hawk Eye plays a significant role in the day-to-day management of Avengers as the COO. 5. Mr Captain America is the CEO of one of Avengers's significant suppliers. 6. Ms Black Widow serves on the boards of ten other companies from various industry sectors; and the Board of Avengers believes that it makes her a valuable asset to the group of companies. 7. Mr Black Panther informed the board of a possible contract relating to the import of retail stock. He was recently approached by an overseas company who indicated that there would be huge savings in store for Avengers. They also mentioned that they would make it worth his while if he assisted them in winning the contract. He had done some research on the company and found out that they are also involved in litigation relating to pollution at their manufacturing plants. He did not accept the contract. 8. Messrs Captain America, Black Widow and Spiderman are the three members serving on the Nominations Committee. The chairperson of the Remuneration Committee, Ms Black Widow, announced that she would resign as chairperson next month. Revenue and receipts - internal control You are a registered candidate auditor at an auditors firm. Your firm has been engaged to evaluate Avengers' internal control systems and you have been assigned to the revenue and receipts cycle. Ben Dekker, the financial accountant of Avengers is of the opinion that the application software is poorly designed and does not make satisfactory use of programmed controls. He informs you that the company is experiencing a number of problems in the cycle including the following: inaccurate and incomplete internal sales orders and picking slips being created. Revenue and receipts - community project As a corporate citizen, Avengers assisted a community bakery to register as a company, sell their goods in the canteen and expand their business. The bakery, registered as Bakeacake (Pty) Ltd, now manufactures a range of biscuits and small cakes that it sells to supermarkets, street vendors and the Avengers canteen. The newly appointed manager of Bakeacake has asked your firm to review the systems within the company that deal with cash. You have been provided with the following information: From Monday to Friday between 07h00 and 09h00, street vendors can purchase biscuits and cakes from the "vendor shop" which is attached to the factory. The vendor shop is run solely by Ted Baker, an employee in the factory administration department. Sales are made only for cash. Cash received is placed in a large metal cashbox. If the vendor requests a receipt, a pre-printed numerically sequenced two-part cash receipt is made out by Ted Baker. He closes the vendor shop at 09h00, takes the cashbox with him and returns to his office in the factory. Before opening the shop on Monday mornings, he leaves the cash from the previous week's sales (in the locked cashbox) on the desk of the senior bookkeeper Cookie Oates. Only Cookie Oates and Ted Baker have keys to the cashbox that is used in the shop. : Social media Mr Thor expressed the view that the use of social media in Avengers is rapidly growing as it is becoming more pervasive and impacting many parts of the business. He requested that your auditing firm should explain the social media exposure risks and the good practices that can be incorporated to prevent a social media crisis. 1.1 Evaluate the corporate governance practices of Avengers according to the principles and practices of the King IV CodeTM. You should state the relevant recommended practice and discuss issues relating to compliance and non- compliance with the King IV Report in your answer. Limit your discussion to the information provided in the scenario. Present your answer under the following headings: a) Governing body (Board of Directors): Composition of the board (seven b) comments) Governing body: Chairperson of the board (three comments) Audit Committee: (five comments) Nominations Committee: (one comment) Company secretary: (one comment) One presentation mark will be awarded if the answer is presented under the correct headings (10.5) (4.5) (7.5) (1.5) (1.5) (1)
Expert Answer:
Answer rating: 100% (QA)
Governing body The board of directors of Avengers Limited is not in compliance with the King IV Code of Govern ance The recommended practice is that the board should be composed of a majority of indep... View the full answer
Related Book For
Quantitative Methods for Business
ISBN: 978-0324651751
11th Edition
Authors: David Anderson, Dennis Sweeney, Thomas Williams, Jeffrey cam
Posted Date:
Students also viewed these economics questions
-
The market capitalization and the salary of the chief executive officers (CEO) for 20 companies are shown in the following Excel spreadsheet (The Wall Street Journal, Feb 24, 2000). CEO Salary...
-
Amazing delights Ltd is a large distributor of confectionary goods. The company has large contracts to supply bakeries and corporate event coordinators throughout the country. The financial director...
-
Trial Balance of Delciee Ltd as at 29 February 2020 Detail Debit Credit Bank 188700 Capital 450000 Cash 121995 Asset 80000 Furniture 15000 Purchase 34300 Accounts Payable 10000 Account receivable...
-
March 31, 2014, adjusted trial balance for Brenner Climbing Adventures has been alphabetized as follows: Required Journalize the closing entries. No. Account Debit Credit $ 2,600 168 Accumulated...
-
Barnard and Associates, a law firm, paid $ 18,000 for 12 months rent in advance on October 1 of the current year. The Companys fiscal year- end is December 31. Prepare the journal entries for the...
-
A hyperbolic mirror (used in some telescopes) has the property that a light ray directed at focus A is reflected to focus B. Find the vertex of the mirror when its mount at the top edge of the mirror...
-
Identify activities that operate at different rates in a. a DVD player; b. a laser printer; c. an airplane.
-
Your sister has just won $300,000 (taxfree) in the state lottery. Shes decided to quit her job and devote herself to writing novels for the next ten years, using her lottery winnings to support...
-
What is the amount of foreign earned income excluded for George?
-
Mr. Geoffrey Guo had a variety of transactions during the 2019 year. Determine the total taxable capital gains included in Mr. Guo's division B income. The transactions included:? 1. On January 1,...
-
Pacific Inc. is considering adding a new production line. The additional fixed cost investment is $82,900 and the variable cost is $31.50 per unit. The expected life is 10 years and MARR= 10%. If the...
-
What is the total tax due for 2019, including self- employment tax, for Stuart, assuming that he earned $20,000 in wages, earned $24,000 in self-employment income from his first business, had a loss...
-
Refer to a citator and locate the following case: New York Life Insurance Co. v. Edwards. a. What happened on appeal to the Court of Appeals? b. What happened on appeal to the Supreme Court?
-
Joe signed for a ten-year lease to rent office space from Stanley. In the first year, Joe paid Stanley $5,000 for the first years rent and $5,000 as rent for the last year oft he lease How much must...
-
Helen Troy, a student seeking a Master's degree in accounting, was awarded a 50 percent scholarship to graduate school (valued at $3,000) and a $6,000 per year teaching assistantship (not required of...
-
What Code Section immediately follows Code Sec. 280?
-
You have been given the task of buying new computers for your entire company. ( 14 points ) Describe five ways the purchase process for your company would differ from a personal purchase of a...
-
What is the amount of total interest dollars earned on a $5,000 deposit earning 6% for 20 years?
-
Wilson Publishing Company produces books for the retail market. Demand for a current book is expected to occur at a constant annual rate of 7200 copies. The cost of one copy of the book is $14.50....
-
Define the terms management science and operations research.
-
Expedition Outfitters manufactures a variety of specialty clothing for hiking, skiing, and mountain climbing. They have decided to begin production on two new parkas designed for use in extremely...
-
A pronghorn, the fastest North American animal, is capable of running at 18 m/s (40 mph) for 10 minutes, after which it must slow down. The time limit isnt because the pronghorn runs out of energy;...
-
When the Glen Canyon hydroelectric power plant in Arizona is running at capacity, 690 m 3 of water flows through the dam each second. The water is released 220 m below the top of the reservoir. If...
-
When the hoof of a galloping horse hits the ground, the digital flexor tendon in its lower leg may stretch by 5% in length, a significant stretch for this 45 cm tendon. The tendon is elastic; mostbut...
Study smarter with the SolutionInn App