Question 1.

EXAMINATION QUESTION(S) SECTION A (COMPULSORY)

Hon. Eric Owusu is a well-known wealthy and influential politician. Bank AAB, a prominent bank in Ghana of which the state owns majority shares, has appointed him as its board chairperson. His first born, Mr. Ernest Owusu, happens to be the Finance Director of this same bank, a position he held four (4) years before his fathers appointment. Dr. Dania Mills, an intelligent Oxford trained financial, risk management expert, is the lead partner of Dania and Associate limited, a reputable auditing firm.

Dr Dania and her Firm Dania Associate Limited have been the external auditors of Bank AAB for the past seven (7) years, three (3) long years before Mr. Ernest Owusu her husband joined the bank. Mr. Joseph Addo a partner at Dania and Associate Limited owns Future Leaders International School, a school he financed with loans from Bank AAB.

Dr Dania has handed over an approved external audit report to her husband for his perusal before onward submission to the board chairman. Mr. Addo who has defaulted on his loan obligation to Bank AAB, also led the audit team. Prior to conducting the external audit, the Managing Director asked the internal auditor to step aside due to an alleged misconduct. Most of the internal audit staff were reshuffled to the accounts department and new members recruited three (3) months before the time of the audit.

Required:

As a Corporate Governance expert with a good understanding of best practices of corporate governance in both Public and Private companies, with specific examples from the case;

A) Establish in five (5) ways, with specific examples, how you will address issues raised in this case with regards to authorities, roles and responsibilities of directors. (5 Marks)

B) You have been informed that Dr Dania Mills has handed over an approved external audit report to her husband for his perusal before onward submission to the board chairman, how will you address this issue from the best practice point of view, regarding the role of external auditors, the audit committee function ad internal audit function in the bank. (5 Marks)

BBA 403

C) Advice the board on the best practice implications of the board chairpersons first born, Mr. Ernest Owusu being the Finance Director of this same bank, and his wife Dr. Dania Mills being the external auditor of the firm. (5 Marks)

D) Share your views on Mr. Joseph Addo position at Dania and Associate Limited ad his relationship to Bank AAB. (5 Marks)

SECTION B

Question 2.

There are Seven (7) Principles of Public Life outlined in the ethical standards (also known as the Nolan Principles) that people working in the public sector are expected to adhere to. Lord Nolan first set them out in 1995 in the first report of the Committee on Standards in Public Life and they are included in a range of Codes of Conduct across public life. The Seven Principles of Public Life apply to anyone who works as a public office-holder.

Required:

A) As an executive director at the State Interest and Governance Authority (SIGA) in Ghana, how will you

apply five (5) of the Seven Principles of Public Life (Nolan Principles) to the roles you play at SIGA?

(10 marks) B) How will confidentiality under the Fundamental Ethical Principles come to play as you perform your role

at SIGA as an executive director? (4 marks) C) How will you maintain high ethical standards as you play your role as a non -executive director at SIGA?

(6 marks)

Question 3.

According to Cadbury Report, Corporate Governance is the system by which companies are directed and controlled (Keasey, et al, 2005). Furthermore, Cadbury recognised that a system of good corporate governance allows boards of directors to be free to drive their companies forward, but exercise that freedom within a framework of effective accountability.

Johnson, Scholes, et al (2005) consider that the governance framework describes whom the organization is there to serve and how the purposes and priorities of the organization should be decided, and this concerns how an organization should function and the distribution of power among different stakeholders. These

authors consider that corporate governance has become an increasingly important issue for organizations.

BBA 403

Required:

Assuming you are a Corporate Governance consultant with fairly good understanding of corporate governance and the issues as explained by the authors;

A)Mention five (5) factors you would consider when preparing a board manual for the board on the characteristics of board composition? (10 marks)

B)Assumingyouareamemberoftheboardofthedirectorsinaprivateoilcompanyandyouservedon any of the known committees,

(i) In five (5) ways, discuss how you will preform your duties? (5 marks)

(ii) Discuss five (5) types of liabilities you would incur if you fall foul of the principles of corporate governance

and the Companies Act (2019)?

Question 4.

(5 marks)

SECTION C

A) Assuming you are the company secretary of a construction firm in Ghana, what will be the ten (10) key areas regarding the roles a n d duties you will perform on the board as the company secretary and the company as a whole? (10 marks)

B) As a company secretary, suggest to the board five (5) circumstances that may lead to the appointment of a director being terminated? (5 marks)

C) Ghana was not long ago in the news as a result of the collapse of some commercial banks. The reasons for the collapse were attributed to weak governance structures among others. There is a new bank which is about to be set up in Accra. As a corporate governance consultant, suggest to the directors five (5) ways in which the application of Corporate Governance Principles will be beneficial for the new bank.

(5 marks)

Question 5.

You are a director of a company, your interests and actions as you perform your roles are not in line with that of your shareholders expectations.

A)What are the implications for that situation? (10 Marks) BBA 403

B) How will you resolve the conflicts that may arise as a result of these differences?