ACCA考试 2022_05_06 每日一练
(c) Critically discuss FOUR principal roles of non-executive directors and explain the potential tensions between
these roles that WM’s non-executive directors may experience in advising on the disclosure of the
overestimation of the mallerite reserve. (12 marks)
4 Assume today’s date is 5 February 2006.
Joanne is 37, she was born and until 2005 had lived all her life in Germany. She recently married Fraser, aged 38,
who is a UK resident, but who worked briefly in Germany. They have no children.
The couple moved to the UK to live permanently on 9 October 2005. Joanne was employed by an American company
in Germany, and she continued to work for them in the UK until the end of November 2005. Her earnings from the
American company were £5,000 per month. Joanne has not remitted any of the income she earned in Germany prior
to her arrival in the UK.
Joanne resigned from her job at the end of November 2005. The company did not hold her to the three months notice
stipulated in her contract, but still paid her for that period. In total, Joanne paid £4,200 in UK income tax under PAYE
for the tax tear 2005/06.
Joanne also wishes to sell the shares she holds in a German listed company. The shareholding cost the equivalent of
£3,500 in September 1986, and its current value is £21,500. She intends to sell the shares in March 2006 and to
invest the proceeds from the sale in the UK. Joanne has made no other capital disposals in the year.
Prior to her leaving employment, Joanne investigated the possibility of starting her own business providing a German
translation service for UK companies, and took some advice on the matter. She paid consultancy fees of £5,000
(excluding value added tax (VAT)) and bought a computer for £2,000 (excluding VAT), both on 23 October 2005.
Joanne started trading on 1 December 2005. She made sales of £2,000 in December, and estimates that her sales
will rise by £1,000 every month to a maximum of £7,000 per month. Joanne believes that her monthly expenses of
£400 (excluding VAT) will remain constant. Her year end will be 31 March, and the first accounts will be drawn up
to 31 March 2006.
Although Joanne has registered her business for tax purposes with the Revenue, she has not registered for VAT and
is unsure what is required of her in this respect.
Required:
(a) State, giving reasons, whether Joanne will be treated as resident or non-resident in the UK for the year of
assessment 2005/06, together with the basis on which her income and gains of that year will be subject to
UK taxation. (3 marks)
2 Ramon Silva is a Spanish property developer, who has made a considerable fortune from the increasing numbers of
Europeans looking to buy new homes and apartments in the coastal regions of Mediterranean Spain. His frequent
contact with property buyers has made him aware of their need for low cost hotel accommodation during the lengthy
period between finding a property to buy and when they actually move into their new home. These would-be property
owners are looking for inexpensive hotels in the same locations as tourists looking for cheap holiday accommodation.
Closer investigation of the market for inexpensive or budget hotel accommodation has convinced Ramon of the
opportunity to offer something really different to his potential customers. He has the advantage of having no
preconceived idea of what his chain of hotels might look like. The overall picture for the budget hotel industry is not
encouraging with the industry suffering from low growth and consequent overcapacity. There are two distinct market
segments in the budget hotel industry; firstly, no-star and one-star hotels, whose average price per room is between
30 and 45 euros. Customers are simply attracted by the low price. The second segment is the service provided by
two-star hotels with an average price of 100 euros a night. These more expensive hotels attract customers by offering
a better sleeping environment than the no-star and one-star hotels. Customers therefore have to choose between low
prices and getting a poor night’s sleep owing to noise and inferior beds or paying more for an untroubled night’s sleep.
Ramon quickly deduced that a hotel chain that can offer a better price/quality combination could be a winner.
The two-star hotels typically offer a full range of services including restaurants, bars and lounges, all of which are
costly to operate. The low price budget hotels offer simple overnight accommodation with cheaply furnished rooms
and staffed by part-time receptionists. Ramon is convinced that considerable cost savings are available through better
room design, construction and furniture and a more effective use of hotel staff. He feels that through offering hotel
franchises under the ‘La Familia Amable’ (‘The Friendly Family’) group name, he could recruit husband and wife teams
to own and operate them. The couples, with suitable training, could offer most of the services provided in a two-star
hotel, and create a friendly, family atmosphere – hence the company name. He is sure he can offer the customer twostar
hotel value at budget prices. He is confident that the value-for-money option he offers would need little marketing
promotion to launch it and achieve rapid growth.
Required:
(a) Provide Ramon with a brief report, using strategic models where appropriate, showing where his proposed
hotel service can add value to the customer’s experience. (12 marks)
(a) Contrast the role of internal and external auditors. (8 marks)
(b) Conoy Co designs and manufactures luxury motor vehicles. The company employs 2,500 staff and consistently makes a net profit of between 10% and 15% of sales. Conoy Co is not listed; its shares are held by 15 individuals, most of them from the same family. The maximum shareholding is 15% of the share capital.
The executive directors are drawn mainly from the shareholders. There are no non-executive directors because the company legislation in Conoy Co’s jurisdiction does not require any. The executive directors are very successful in running Conoy Co, partly from their training in production and management techniques, and partly from their ‘hands-on’ approach providing motivation to employees.
The board are considering a significant expansion of the company. However, the company’s bankers are
concerned with the standard of financial reporting as the financial director (FD) has recently left Conoy Co. The board are delaying provision of additional financial information until a new FD is appointed.
Conoy Co does have an internal audit department, although the chief internal auditor frequently comments that the board of Conoy Co do not understand his reports or provide sufficient support for his department or the internal control systems within Conoy Co. The board of Conoy Co concur with this view. Anders & Co, the external auditors have also expressed concern in this area and the fact that the internal audit department focuses work on control systems, not financial reporting. Anders & Co are appointed by and report to the board of Conoy Co.
The board of Conoy Co are considering a proposal from the chief internal auditor to establish an audit committee.
The committee would consist of one executive director, the chief internal auditor as well as three new appointees.
One appointee would have a non-executive seat on the board of directors.
Required:
Discuss the benefits to Conoy Co of forming an audit committee. (12 marks)