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1. Co. is financed by Debt and Equity, same business area, using cash to fund expansion, we wld use existing WACC?
2. The CEO is accountable to the board (Chairman and NEDs) for all aspects of co. performance and operations, but who appoints the CEO?
3. Who appoints the Chairman and who is the Chairman accountable to?
4. Who appoints the NEDs and who are the NEDs accountable to?
5. Cross Directorship in other companies is a threat to NED independence, is this referring to having a role as a NED or an ED (or both) on other boards?
6. Can the same NEDs sit on the AC, NC and RC simultaneously?
7. Are connected parties allowed to bid to supply goods & services?
8. Would allowing staff to follow unwritten policies be considered a threat to the control environment?
Please ask one question per post. I will answer them this time but in the future I will answer only the first one if there is a list.
1 Existing WACC if gearing is unchanged. So, sepends where the cash comes from. If retained earnings, equity will have increased. If from borrowings debt will presumably hae increased.
2 Nomination committee, ratified by members in general meeting.
3 As above. Ultimately responsible to members.
4 As 2
5 Potentially both.
6 Yes
7 Yes, but connected transactions must bemdisclosed in the FS.
8 Yes. Unwritten rules are not worth the paper they are written on. Besides, habit can establish rules that might be undesirable.
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