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1. Please I had a challenge about NEDs fees issue in the BPP mock. Per the code, I thought the NEDs remuneration is fixed or flat. But the information I was given as feedback in the mock, which I have confirmed in the UK Corporate Governance code document is that they should be paid based on their hours worked for the company. My question is, should it always be the case or it is acceptable for NEDs remuneration to be fixed or flat?
2. Please I would like you to throw light on the criteria for concluding that Material misstatement in a FS item is pervasive.
3. Please I came across something like Financial Audi, Operational Audi and Fraud Investigation relating to Internal Audi when solving some questions. I want to ask that do we have types of internal Audit like that or in other ways?
Thank you.
1. This is all that the Code says about NEDs’ remuneration:
“34. The remuneration of non-executive directors should be determined in accordance with the Articles of Association or, alternatively, by the board. Levels of remuneration for the chair and all non-executive directors should reflect the time commitment and responsibilities
of the role. Remuneration for all non-executive directors should not include share options or other performance-related elements.” It does not specify hourly – perhaps you simply mean by fixed or flat that there should not be bonus elements. Unless a NED position is full-time a fixed salary would not be appropriate – hence paid more on a consultancy basis for days worked.2. See this post https://opentuition.com/topic/past-year-paper-september-2018/ or this post https://opentuition.com/topic/dec-2016-cbe-auditors-report-how-is-tp-not-pervasive/ or use the search function for numerous similar posts
3. I don’t know what you are asking – there is one LO which refers to these as types of work which might be carried out by internal audit. I suggest you look at M/J18 Q16 (c) (I think) which examiners this (not in a any detail).
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