MRG POLICIES

MRG has developed a Code of Ethics based on its values. Employees have observed

that this Code is used as a basis for adverse performance evaluation and terminating the

employment of staff as required with attention centred solely on the vaguely defined

principles of efficiency and accountability.

There is a related party transactions policy which requires all potential conflicts to be

disclosed to Emil, the managing director. The policy includes requirements that

transactions with related parties are conducted at arm$$s length and on market terms with

sole discretion to override these terms afforded to Suzy and Emil based on competitive

advantage.

MRG has a complaints policy where any grievances may be raised at restaurant level

with any unresolved concerns referred to Emil for determination. The policy has worked

well as no restaurant managers have, to date, referred any matters to Emil. Complaints

are also confined to operational issues and are not permitted to reference the Code of

Ethics.

There is a share disposal policy which requires all staff with shareholdings to request

permission from Suzy and Emil prior to any sale of shares held. Chefs and restaurant

managers are incentivised with issues shares in MRG and are subject to this policy.

MRG has recently introduced an anti$-$corruption policy relating to the acceptance of gifts

and benefits from customers and suppliers by employees. Although the policy is not

prescriptive, it has been used as the basis to terminate employees when required but

has yet to be applied to executives or directors. SUSTAINABILITY PRACTICES & BUSINESS CONCERNS

MRG purchase much of their trading stock through Blue Sky Providores, a buying group

featuring the sourcing of ingredients produce using sustainable agriculture. Trojan

Holdings, a substantial shareholder of MRG with board representation, are the principal

owners of Blue Sky$.$

All MRG premises utilise energy$-$efficient equipment and appliances. MRG is currently

investigating the possibility of installing solar panels at all its properties to reduce reliance

on grid energy.

MRG have been recognised for not only providing nutritional information for all meals,

but also as innovators in using precise portion controls. However, some of the data

utilised from Blue Sky on key ingredients has been questioned by regulators with

requests for additional information served on MRG$.$

MRG has entered into a long$-$term agreement with Sustain, a supplier of recyclable food

packaging for take$-$away meals. Although widely acclaimed as a major sustainability

innovation, the packaging is current under independent testing as there have been

consumer claims that packaging fibre blends with some foods when heated beyond a

particular temperature.

An initiative intended to reduce waste involved donated unused food to charity for

distribution. However, MRG$$s legal firm and insurance company have insisted on the

cessation of this initiative due to exposure to litigation for poisoning from spoiled food, as

well as the high cost of using Sustain recyclable packaging to distribute food.

RISK MANAGEMENT & CONCERNS

In $2023,$ MRG appointed and commenced using a risk committee for oversight of all

aspects of risk management across the organisation. The committee is given complete

autonomy and provides a quarterly report of risks identified and any variation in

treatment. The committee is chaired by Emil and includes Sindy Gustavsson.

The committee has initially focused on property related issues, including concerns with

the fire rating at one of MRG$$s premises and the general condition and age of buildings.

However, litigation faced by MRG has typically involved employee terminations and

customer injuries and allergic reactions.

The appointment of Leeann Trevino as chief technology officer has ensured that MRG

systems are secure$,$ although there are concerns relating to inventory management

following several supply chain issues necessitating several temporary menu changes

due to ingredient unavailability. Detailed instructions:

$1)$ Summarise the background of a contemporary accounting issue $($from the assigned case

study$).$

$2)$ Identify sources relevant to the chosen accounting issue $($e$.$g$.$ journal articles, textbooks,

websites etc.$).$ At least three of these must be academic journal articles, but various sources may

be used. You must reference each source as per KBS referencing guidelines.

$3)$ Complete an annotated bibliography for three of your selected sources. At least one of your

sources selected must be an academic journal article. The format should follow guidelines

provided during week $11$ content.

$4)$ Outline possible next steps for researching the issue including limitations and

ethical issues.