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THE INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF BANGLADESH CMA DECEMBER, 2016 EXAMINATION
BUSINESS LEVEL
SUBJECT: GE 05. FUNDAMENTALS OF ETHICS, CORPORATE GOVERNANCE AND BUSINESS LAW.
Time: Three hours Full Marks: 100
All questions are to be attempted.
Show computations, where necessary.
Answer must be brief, relevant, neat and clean.
Start answering each question from a fresh sheet.
Q. No. 1.
(a) Write down the values & attitudes that are essential for professional accountants.
(b) “Social Responsibility is paramount while we are dealing with all stakeholders”- give your opinion with justification.
[Marks: (7+8) = 15]
Q. No. 2.
What is ethical dilemma? How does ethical dilemma arise? How can a professional accountant resolve ethical conflicts, explain.
[Marks: 10]
Q. No. 3.
(a) “Corporate governance is the system by which companies are directed and controlled”, explain.
(b) Distinguish between rule-based and principle-based approaches to governance. Whether the ‘Corporate Governance Notification’ issued by Bangladesh Securities & Exchange Commission (SEC) is rules-based or principle-based, explain with logic and reference.
(c) Describe the qualification and disqualification of Independent Directors according to the
‘Corporate Governance Notification’ for listed companies issued by the SEC.
[Marks: (5+5+5) = 15]
Q. No. 4.
(a) According to the ‘Contract Act-1872’ what are the conditions of a valid offer.
(b) Explain the ways of revocation of a offer.
(c) You are the Senior Finance Manager of ABC Company Ltd. The Chairman of your company had an accident on the way to the office and lost his hand bag containing important documents and Tk. 5,00,000. He declared an award of Tk. 50,000, if anyone can find the bag and return without any damage. Fortunately, his address was attached at the back side of the bag. Mr. Honest, without knowing the declaration, has found the bag and returned without any damage. After being informed, Mr. Honest came back and claimed the award. But, the company lawyer has advised the chairman that there is no obligation to comply the offer.
The Chairman is confused and seeking your advice on both legal and ethical ground - Advise him.
[Marks: (5+5+5) = 15]
Page 2 of 2 CMA DECEMBER, 2016 EXAMINATION
BUSINESS LEVEL
SUBJECT: GE 05. FUNDAMENTALS OF ETHICS, CORPORATE GOVERNANCE AND BUSINESS LAW.
Q. No. 5.
(a) The issued capital can be less than the authorized share capital but it cannot be more than that – Do you agree with the statement? Explain.
(b) Explain with financial consequence – (a) Right issue (b) Bonus issue (c) Dividend.
(c) A and B are the shareholders of XYZ (Pvt.) Ltd Company. The company wants to raise more capital to increase the size of the company and expand its business. Give answer of the following questions:
(i) What options does XYZ (Pvt.) Ltd. company have to raise more fund for the business?
(ii) Explain the above if XYZ is a publicly listed company.
[Marks: (5+5+5) = 15]
Q. No. 6.
(a) Explain the distinction between dismissal and wrongful dismissal.
(b) What are the legal procedures relating to the retrenchment of a worker?
(c) You are the Senior Finance Manager of XYZ Garments Ltd. Your company retrenched 20 workers from Sewing Department at the beginning of the year as there was insufficient work order and the company was making loss. Now, after 6 months, the business environment has changed and there is enough work order to profitably run the company.
The Board has decided to employ 15 new workers for Sewing Department and other 15 for different departments. Having been informed of the new appointment circular, the retrenched workers are demanding for their re-appointment. The Board seeks your advice.
- Advice the board on legal ground.
[Marks: (5+5+5) = 15]
Q. No. 7.
(a) Write down the rights & responsibilities of Directors & Shareholders separately.
(b) What are the procedures to arrange a General Meeting and what are the legal consequences of failure to hold AGM?
[Marks: (7+8) = 15]
= THE END =
