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Find Related Questions by Tags, levels, etc.
A company director who breaches his/her fiduciary duty to the company is liable to being
A. Removed from office
B. Reported to the Economic & Financial Crimes Commission (EFCC)
C. Reported to the Independent Corrupt Practices Commission (ICPC)
D. Reported to the Police
E. Rusticated
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Muntaka Property Investments Ltd (MPI) owns a variety of shopping centres and retail units throughout Ghana. Last year, it decided to build a new outlet shopping centre in Adenta, Accra City, in the belief that the opening of the new light-rail line in this area would facilitate customer access to this centre and could attract customers from all parts of the country. To finance this development, MPI decided to sell some of its other properties. One of these properties was a small retail park located within three kilometers off Weija (a large provincial town). Gyeabour, a director of MPI, was tasked with overseeing this sale. Within three weeks of the Weija property being advertised for sale, Gyeabour reported that he had received an offer on the property for the full asking price. Delighted with this, the Board of MPI authorized Gyeabour to effect the sale of this property.
However, two months after the sale was completed, it was announced that one of the largest pharmaceutical companies in the world was establishing its global head office on the site adjacent to the former Weija property, and as a consequence of this fact, the value of the property had already increased by an excess of 60%. Upon further investigation, MPI discovered that the Weija property was purchased by Gyasco Properties Ltd., a company wholly owned by Gyeabour’s two sons, and that the mother-in-law of one of these sons is a local politician in Weija. Consequently, she would have been aware of the impending purchase of the adjacent property by the pharmaceutical company.
Required:
Describe a director’s fiduciary duty regarding conflict of interest and determine whether this duty has been breached by Gyeabour in this situation.
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a) Cho instructs his agent Duu to sell his car. Cho decided to pay GH¢5,000 as commission to Duu on completion of the sale. Duu sold the car and was accordingly paid the commission of GH¢5,000. Cho then immediately found that the purchaser of the car had also paid a bribe of GH¢2,500, which Duu did not disclose.
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a) Bobo Company Limited puts up an advert in the ‘Daily Times’ newspaper inviting members of the public to purchase shares. Mr. Kobina Fosu, an investor, decided to purchase some of the shares. He consulted an investment firm to advise on whether or not he should purchase the shares of the company. The investment firm advised Mr. Kobina Fosu that the company was buoyant and that its capital base was strong and attractive. As a result, Mr. Kobina Fosu bought a substantial number of shares of the company. Two months after the purchase of the shares, however, the company went bankrupt.
Required:
What advice, if any, will you give to Mr. Kobina Fosu? (10 marks)
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Adjo is a director of Boxo Company Ltd. She has insider information that the profits of the company when announced in ten (10) days’ time, could lead to a rise in the share value of the company. She, therefore, bought shares in the company herself and also advised her friend, Michael, to buy shares in Boxo Company Ltd, but did not tell him why.
Required:
In the context of the facts stated in the question, explain the conduct of Adjo and Michael with regard to the shares of Boxo Company Ltd. (10 marks)
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In 2017, some financial institutions in Ghana were placed under receivership. This was mainly due to poor corporate governance practices. Some of these practices were in clear violation of the duties and responsibilities of those charged with governance.
Required:
Explain FIVE (5) duties those charged with governance were expected to perform.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
Find Related Questions by Tags, levels, etc.
A company director who breaches his/her fiduciary duty to the company is liable to being
A. Removed from office
B. Reported to the Economic & Financial Crimes Commission (EFCC)
C. Reported to the Independent Corrupt Practices Commission (ICPC)
D. Reported to the Police
E. Rusticated
Find Related Questions by Tags, levels, etc.
Muntaka Property Investments Ltd (MPI) owns a variety of shopping centres and retail units throughout Ghana. Last year, it decided to build a new outlet shopping centre in Adenta, Accra City, in the belief that the opening of the new light-rail line in this area would facilitate customer access to this centre and could attract customers from all parts of the country. To finance this development, MPI decided to sell some of its other properties. One of these properties was a small retail park located within three kilometers off Weija (a large provincial town). Gyeabour, a director of MPI, was tasked with overseeing this sale. Within three weeks of the Weija property being advertised for sale, Gyeabour reported that he had received an offer on the property for the full asking price. Delighted with this, the Board of MPI authorized Gyeabour to effect the sale of this property.
However, two months after the sale was completed, it was announced that one of the largest pharmaceutical companies in the world was establishing its global head office on the site adjacent to the former Weija property, and as a consequence of this fact, the value of the property had already increased by an excess of 60%. Upon further investigation, MPI discovered that the Weija property was purchased by Gyasco Properties Ltd., a company wholly owned by Gyeabour’s two sons, and that the mother-in-law of one of these sons is a local politician in Weija. Consequently, she would have been aware of the impending purchase of the adjacent property by the pharmaceutical company.
Required:
Describe a director’s fiduciary duty regarding conflict of interest and determine whether this duty has been breached by Gyeabour in this situation.
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a) Cho instructs his agent Duu to sell his car. Cho decided to pay GH¢5,000 as commission to Duu on completion of the sale. Duu sold the car and was accordingly paid the commission of GH¢5,000. Cho then immediately found that the purchaser of the car had also paid a bribe of GH¢2,500, which Duu did not disclose.
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a) Bobo Company Limited puts up an advert in the ‘Daily Times’ newspaper inviting members of the public to purchase shares. Mr. Kobina Fosu, an investor, decided to purchase some of the shares. He consulted an investment firm to advise on whether or not he should purchase the shares of the company. The investment firm advised Mr. Kobina Fosu that the company was buoyant and that its capital base was strong and attractive. As a result, Mr. Kobina Fosu bought a substantial number of shares of the company. Two months after the purchase of the shares, however, the company went bankrupt.
Required:
What advice, if any, will you give to Mr. Kobina Fosu? (10 marks)
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Adjo is a director of Boxo Company Ltd. She has insider information that the profits of the company when announced in ten (10) days’ time, could lead to a rise in the share value of the company. She, therefore, bought shares in the company herself and also advised her friend, Michael, to buy shares in Boxo Company Ltd, but did not tell him why.
Required:
In the context of the facts stated in the question, explain the conduct of Adjo and Michael with regard to the shares of Boxo Company Ltd. (10 marks)
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In 2017, some financial institutions in Ghana were placed under receivership. This was mainly due to poor corporate governance practices. Some of these practices were in clear violation of the duties and responsibilities of those charged with governance.
Required:
Explain FIVE (5) duties those charged with governance were expected to perform.
Find Related Questions by Tags, levels, etc.
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