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Questions and Answers
What is the primary responsibility of the board of directors in terms of financial reports?
What is the primary responsibility of the board of directors in terms of financial reports?
What is a key aspect of a non-executive independent director's role?
What is a key aspect of a non-executive independent director's role?
What is the primary role of non-executive independent directors?
What is the primary role of non-executive independent directors?
What is the primary focus of management in a corporate structure?
What is the primary focus of management in a corporate structure?
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What is a key responsibility of the board of directors in terms of internal controls?
What is a key responsibility of the board of directors in terms of internal controls?
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What is a key aspect of a non-executive independent director's preparation for board meetings?
What is a key aspect of a non-executive independent director's preparation for board meetings?
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What is a key characteristic of a non-executive independent director's role?
What is a key characteristic of a non-executive independent director's role?
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What is the collective nature of the board of directors' decisions referred to as?
What is the collective nature of the board of directors' decisions referred to as?
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What is the primary role of internal auditors?
What is the primary role of internal auditors?
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Who has greater standing in a corporation, the Chairperson of the Board or the CEO?
Who has greater standing in a corporation, the Chairperson of the Board or the CEO?
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Who is responsible for providing accurate and timely reports to shareholders and other stakeholders?
Who is responsible for providing accurate and timely reports to shareholders and other stakeholders?
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What is the consequence of combining the CEO and Chairperson of the Board roles?
What is the consequence of combining the CEO and Chairperson of the Board roles?
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What is the primary role of the Audit Committee?
What is the primary role of the Audit Committee?
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What is the purpose of a strong and independent board?
What is the purpose of a strong and independent board?
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What is the role of the CEO in a corporation?
What is the role of the CEO in a corporation?
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Who translates the strategic plan into the operations of the business?
Who translates the strategic plan into the operations of the business?
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Why is it desirable to have a separate Chairperson of the Board and CEO?
Why is it desirable to have a separate Chairperson of the Board and CEO?
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What is the primary responsibility of the executive management?
What is the primary responsibility of the executive management?
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What happens when there is a disagreement between the board and the executive?
What happens when there is a disagreement between the board and the executive?
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Who develops financial and other reports that meet public, stakeholder, and regulatory requirements?
Who develops financial and other reports that meet public, stakeholder, and regulatory requirements?
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What is the primary purpose of internal auditors performing audits?
What is the primary purpose of internal auditors performing audits?
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What is the role of executive management in relation to the board?
What is the role of executive management in relation to the board?
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Who is responsible for being alert to relevant trends in the industry and the organization's operating environment?
Who is responsible for being alert to relevant trends in the industry and the organization's operating environment?
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What is the primary responsibility of the executive management in terms of laws and regulations?
What is the primary responsibility of the executive management in terms of laws and regulations?
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Study Notes
Roles and Responsibilities in Corporate Governance
Executive Directors
- Approve annual financial reports, annual reports, and other public documents/sensitive reports
- Ensure an effective system of internal controls exists and operates as expected
Non-Executive/Independent Directors
- Understand the organization, its business, operating environment, and financial position
- Apply expertise and skills in the organization's best interests
- Assist management in keeping performance objectives at the top of its agenda
- Recognize that their role is not to act as an auditor or member of the management team
- Respect the collective, cabinet nature of the board's decisions
- Prepare for and attend board meetings
- Seek information on a timely basis to contribute to discussions
- Ask appropriate questions relative to operations
Management Auditors
- Perform audits of companies for compliance with company policies and laws
- Conduct audits to evaluate the efficiency of operations
- Periodically evaluate and test controls
Chairperson of the Board/CEO
- The Chairperson of the Board governs all board activities, including regulatory functions over the executive
- The CEO leads corporate operations and is in charge of executive activities
- The Chairperson has greater standing than the CEO in case of disagreements between the board and executive
- Combining the CEO and Chairperson roles can compromise the independence of the board
CEO's Responsibilities
- Manage the organization effectively and provide accurate and timely reports to shareholders and stakeholders
- Recommend strategic direction and translate into operational plans
- Manage human, physical, and financial resources to achieve objectives
- Ensure conformance with relevant laws and regulations
- Develop and manage risk management and internal control frameworks
- Develop, implement, and update policies and procedures
- Monitor industry trends and the operating environment
- Provide information to the board and act as a conduit between the board and organization
- Develop financial and other reports that meet public, stakeholder, and regulatory requirements
Audit Committee of the Board of Directors
- Provide oversight of the internal and external audit function
- Oversee the process of preparing annual financial statements and public reports on internal control
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Description
Test your knowledge on governance, business ethics, risk management, and internal control systems. Learn about approving annual reports, internal controls, and non-executive roles.
