Sir I am absolutely befuddled when I checked the answer section of this past paper especially referring to 1)a)i) here it says that principal is board of trustees and management board is agent.
However what I WROTE was donors and legacies(tho dead but still thought to include them anyway) are principals and agent like the examiner- management board.
So are both answers correct? Or I am clearly wrong?
Ask the Tutor ACCA SBL
BCO S/D 2020
And if I am wrong, should I deduce that in 2 tier structure, regardless of organisation type, supervisory board is principal and agent- management board?
and in case of unitary structure, EDs/management is agent? donors/shareholders principal? So in other words, if BCO had unitary structure, I would have been CORRECT in saying that donors are principal and management board is agent?
Sir I guess you forgot to answer this question...
4y ago#3Donors are not the principals. They have no formal place in the structure.
It's like saying that customers are the principals of a shop. Customers/donors can withhold their money but they are not part of management. Shareholders are principals because directors must act in their best interests.
But, I agree, this is a confusing question and I think you would have done OK using your approach.
This topic is locked — no new replies.