CHAPTER 8 : CORPORATE GOVERNANCE - BLACK'S PINK

8.1.1 define the corporate governance in general
Corporate governance is the system of rules, practices and processes by which a firm is directed and controlled. Corporate governance essentially involves balancing the interests of a company's many stakeholders, such as shareholders, management, customers, suppliers, financiers, government and the community

8.1.2 expalain the needs of good governance
Equity and Inclusiveness - People should have opportunities to improve or maintain their well-being. Effectiveness and Efficiency - Processes and institutions should be able to produce results that meet the needs of their community while making the best of their resources.

8.2

Accountability
Accountability is a key tenet of good governance. Who is accountable for what should be documented in policy statements. In general, an organization is accountable to those who will be affected by its decisions or actions as well as the applicable rules of law.

Transparency
Transparency means that information should be provided in easily understandable forms and media; that it should be freely available and directly accessible to those who will be affected by governance policies and practices, as well as the outcomes resulting therefrom; and that any decisions taken and their enforcement are in compliance with established rules and regulations.

Regulatory frame work
Good governance requires fair legal frameworks that are enforced by an impartial regulatory body, for the full protection of stakeholders.

Business ethics and social responsibility

Business ethics and social responsibility are important issues for companies to consider when making decisions. ... Social responsibility is the concept that businesses have a duty to society and the environment and focuses on doing what is best for the well-being of society as a whole

Adminstrative structure

administrative organizational structure is a typically hierarchical arrangement of lines of authority. It determines how the roles, power and responsibilities are assigned, and how the work process flows among different management levels.






8.2.1 identify the structure of audit committee

What is an Audit Committee. An audit committee is one of the major operatingcommittees of a company's board of directors that is in charge of overseeing financial reporting and disclosure. All U.S. publicly-traded companies must maintain a qualified audit committee in order to be listed on a stock exchange

8.2.2 explain the roles of audit committee

The primary purpose of a company's audit committee is to provide oversight of the financial reporting process, the audit process, the company's system of internal controls and compliance with laws and regulations.

8.2.3 discuss the advantages of establishing the audit committee

Improve financial practices and reporting. ...
Help prevent fraud. ...
Develop the internal audit function. ...
Enhance the external audit function.

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