Serena VDW Co has been trading for over 20 years and obtained a listing on a stock exchange ve years ago. it provides specialist training in accounting and nance. The listing rules of the stock exchange require compliance with corporate governance principles, and the directors are fairly condent that they are following best practice in relation to this. However, they have recently received an email from a significant shareholder, who is concerned that Serena VDW Co does not comply with corporate governance principles. Serena VDW Co's board comprises six directors; there are four executives who originally set up the company and two nonexecutive directors who joined Serena VDW Co just prior to the listing. Each director has a specic area of responsibility and only the nance director reviews the nancial statements and budgets. '93 Show Transcribed Text The chief executive ofcer, Daniel Brown, set up the audit committal and he sits on this sub-committee along with the finance director am the non-executive directors. As the board is relatively small, and to save costs, Daniel Brown has recently taken on the role of chairman of the board. It is the nance director and the chairman who make decisions on the appointment and remuneration of the external auditors. Again, to save costs, no internal audit function has been set up to monitor internal controls. The executive directors' remuneration is proposed by the nance director and approved by the chairman. They are paid an annual salary as well as a generous annual revenue related bonus. Since the company listed, the directors have remained unchanged and none have been subject to reelection by shareholders