Mr. Zaki is the audit manager for the firm Zakiah & Co and has been assigned...

  

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Mr. Zaki is the audit manager for the firm Zakiah & Co and has been assigned to audit Gemilang Technology company (Gemilang), a company that plans to register on the stock exchange in the next six months. Stock exchange listing rules requires compliance with the principles of corporate governance, and directors are not necessarily the same there they follow best practices in this regard. They then asked the views of the audit partner on this matter. Gemilang s board of directors consists of six executive directors, one chairman non-executive and three non-executive directors (PBE). Chairman and one of the of PBE is a former executive director of Gemilang and upon reaching the age of retirement, they have been offered non-executive roles. Syarikat Gemilang has set up an audit committee (JKA), and all PBES are members of the JKA including chairman of the board of directors who also holds the position of chairman of the JKA. All four members of the JKA, were previously involved in sales-related roles or production. All directors have been on the board for at least four years. By since the chairman has no executive role, he is fully accountable to connect with shareholders and answer their questions. Company however, an internal audit function has not been established to monitor controls inner. a) Based on the above case: (1) Describe FOUR (4) weaknesses of Gemilang s corporate governance practices Technology. (ii) Provide suggestions for overcoming each weakness of good governance practices you identify in a) (i) to ensure compliance with the code of practice best corporate governance. b) Explain the role of external auditors to ensure effective corporate governance. c) Discuss why it is important for audit committee members to have knowledge and financial accounting experience in carrying out their monitoring functions. Mr. Zaki is the audit manager for the firm Zakiah & Co and has been assigned to audit Gemilang Technology company (Gemilang), a company that plans to register on the stock exchange in the next six months. Stock exchange listing rules requires compliance with the principles of corporate governance, and directors are not necessarily the same there they follow best practices in this regard. They then asked the views of the audit partner on this matter. Gemilang s board of directors consists of six executive directors, one chairman non-executive and three non-executive directors (PBE). Chairman and one of the of PBE is a former executive director of Gemilang and upon reaching the age of retirement, they have been offered non-executive roles. Syarikat Gemilang has set up an audit committee (JKA), and all PBES are members of the JKA including chairman of the board of directors who also holds the position of chairman of the JKA. All four members of the JKA, were previously involved in sales-related roles or production. All directors have been on the board for at least four years. By since the chairman has no executive role, he is fully accountable to connect with shareholders and answer their questions. Company however, an internal audit function has not been established to monitor controls inner. a) Based on the above case: (1) Describe FOUR (4) weaknesses of Gemilang s corporate governance practices Technology. (ii) Provide suggestions for overcoming each weakness of good governance practices you identify in a) (i) to ensure compliance with the code of practice best corporate governance. b) Explain the role of external auditors to ensure effective corporate governance. c) Discuss why it is important for audit committee members to have knowledge and financial accounting experience in carrying out their monitoring functions.

Answer rating: 100% (QA)

i Corporate governance is a system by which corporates are directed and controlled The Board of Directors have a fiduciary duty to the shareholders and thereby are responsible for overseeing the opera... View the full answer