(a)ABC Ltd is a public listed Company on the Australian Securities Exchange. Frank Doorman is the CEO and Chair of the Board. The CFO (Chief Financial Officer) and the COO (Chief Operating Officer) are also directors on the Board. Due to his previous experience as an auditor, the CFO is also Chair of the Audit Committee, the other member of the audit committee is the COO, who was appointed because of his knowledge of systems and internal control in the Company. Frank sees no need for any other committees as the Company has been very stable over the last few years with no change of directors.

The four other members of the board of directors at ABC Ltd are;

1.Alice, the wife of Frank. Alice has never been employed by the Company.

2.George, a long-time director of the bank that owns 20% of the shares in ABC Ltd and has provided much of the finance for the recent aggressive expansion of the Company.

3.Drew, who is very experienced and the CEO of an Accounting firm that has no other connection with ABC limited. Drew has been a director for 2 years. Drew owns 1% of the shares of ABC Ltd.

4.James has never been employed by ABC Ltd and owns no shares in the Company. Other than his directorship, James has no connection with ABC Ltd and has been a long standing director since the Companies listing on the ASX 40 years ago.

Question Evaluate the Board structure of ABC Ltd from a corporate governance viewpoint. As part of your discussion consider each of the four directors Frank believes are independent.

3 (b)For each of the following ethical situations consider the fundamental principles of professional behaviour and:

-identify the fundamental principle at threat,

-identify the threat to the fundamental principle

-discuss how the accountant involved should resolve the situation

(i)You have been employed as a graduate accountant in a listed company and have been asked to complete a business report for the group.Your report must be completed by the tomorrow but vital statistics essential for the report will not be available for another three days. Your immediate supervisor has made it clear you will be severely reprimanded if the work is not completed on time.