Governance, Risk and Ethics (P1) June 2013 to June 2014

As u might now the structure of the paper SEC A = 50 marks question comprising of two page scenario SEC B = 2 out of 3 question comprising of 25 marks = 50 marks The papers is a very interesting one given you attend all my class and feel it from practical perspective. Remember that solving exam kit can ensure passing in exam , but to be distinct u need to be enriched by the knowledge that p1 has in offer for you. So lets have a look at what we are going to cover in the five sections as per ACCA syllabus

This is the biggest section of all and knowledge of this section is required to answer each and every question of the paper. In practical context you are going to learn a lot about directors here, hence knowledge from F4 would be pretty useful. Here One need to realize and demonstrate that they understand all the guidelines given in Uk Corporate governance code which unlocks the secrets of achieving business objectives i.e. knowing all the ideal guideline regarding " NED/Chairman/CEO/ Diff committees/ Stakeholder and so on"
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 Explain the problems companies have suffered, that have resulted in the need for corporate governance regulations. Explain the agency problem and agency cost. Who sets corporate governance regulations? What are the key concepts that underpin corporate governance? For a given situation, identify the key corporate governance principles or concepts that are / are not being followed. Explain the business argument for and against corporate governance? Explain the role of directors in a company? What is meant by fiduciary duty? What are the main roles of NEDs? Explain the importance of the independence of NEDs, and circumstances where their independence could be threatened? Explain the importance of succession planning for a Nomination Committee? Explain the meaning of diversity and critically evaluate issues of diversity on board of directors? ( Syllabus Addition) Suggest some content of an induction programme for a new company director? Explain the importance of annual performance reviews for boards of directors, and how such a review could take place effectively? Discuss the main components of a director remuneration package, and how to ensure it is aligned with company interests? Explain the importance of institutional shareholders, and the circumstances in which they may intervene in a company? Explain the links between agency theory and transaction cost theory? Explain the differences between legal systems of CG and codes of best practice? Explain how and why governance differs between different countries and cultures? Explain the extent to which governance principles may apply to organizations other than large listed companies? For the above company identify the different groups of stakeholders and discuss the extent to which the company may choose to deal with them? Discuss the extent to which stakeholders could be held responsible for the behavior of an organization?

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This is the smallest section of all and knowledge of this section is mostly applicable in scenario based question. In practical context internal control is what that would ensure you are not being deterred to achieve your objectives. In specific you are going to learn about """what is sound internal control"" as well as getting the idea on designing, implementing and monitoring internal control. Despite of all this new things knowledge from F8 could be utilized while writing answers. In scenario based exam question you would probably need to analyze possible reasons of internal control failures. So using common sense as well as an in depth understanding of corporate governance principle from SEC A would be helpful. Memorizing wont help much and hence the question checklist would be small but as substitute we have to learn to analyze scenario based question.

Explain what is required for an effective system of internal controls, as recommended by COSO and Turnbull. Explain how the control system at the above company differs from a sound system as described in the Turnbull guidance. Explain the role of Internal Audit in good corporate governance. Explain the role and benefits of an Audit Committee.

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To achieve your business objectives, you need to know what are the possible risk that may arise, that story is defined in SEC C after knowing your risk you must decide which risk to manage ( SEC D) by implementing set of internal control ( SEC B). You see the interconnection of these two section to the whole syllabus. Hence these can be examined in SEC A as well as in SEC B. I would suggest to be informed on the three aspects mentioned below bit precisely Learning about at-least 20 types of possible risk and how to mitigate those Peoples involved in risk management including committees Justify the action of risk manager in a given scenario As well as being familiar with TARA and ALARP

Explain the importance of good risk management as part of good corporate governance. Explain how the Board, possibly through a Risk Committee, is central to good risk management. Explain the concepts of risk appetite, risk capacity, and risk attitude. Describe how a typical risk management process works. For a given organization, suggest the risk categories that could be used when assessing risks. Describe different ways in which risk can be measured and assessed. Describe the different ways in which risk can be addressed.

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An area i like to lecture on but yet disliked by students in general since this section comprise of infinite viewpoints of intellect ppl who lived in past. Students score very less here because "" Say exam Qn ask to assess a particular situation from the perspective of xyz theory", but yet at the end the student turns up giving his own opinion""___ Alerting u guys "" Listen examiner doesn't want to know what u feel rather want to see whether u understand the intellects view or ethical theories and apply in a scenario as the examiner wants u to do so""

Should codes of ethics be based on rules or principles? Explain the fundamental principles of the ACCA Code of Ethics Highlight the issues with conflicts of interest Discuss the need for confidentiality when dealing with client affairs Describe different frameworks that exist for helping accountants to come to make ethical decisions (including Tuckers 5 Questions, and the American Accounting Association 7 Step Model) Explain Kohlbergs stages of moral development and apply them to a scenario Explain different models of ethics, including deontological v teleological, relativism v absolutism, and personal ethics v corporate ethics Explain the concepts of sustainability, environmental footprint, and social footprint Explain the concepts of a profession, and professional behavior Discuss the responsibilities an accountant has to their employer, and highlight how these may conflict with professional responsibilities Describe the influence that a professional accountant can have on society, and whether they should behave reactively or proactively Describe and assess the social and environmental effects that economic activity can have (in terms of social and environmental footprints and environmental reporting)? (Syllabus Addition) Explain and assess the typical contents of a social and environmental report, and discuss the usefulness of this information to stakeholders? (Syllabus Addition)

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ACCA Syllabus Section

Estimated Duration 4 class for notes with 2 classes for discussing relevant question i.e. 6 Class

Define governance and explain its function in the effective management and control of We would have 2 class everyday which Organizations and of the resources for means by we would be done i.e. which they are accountable 2 class for notes with 1 for discussing relevant question i.e. 3 Class After C&D this would be next to be done by i.e. the 14th class 3 class for notes with 1 for discussing relevant question i.e. 4 Class Explain the role of the accountant in identifying and assessing risk Explain and evaluate the role of the accountant in controlling and mitigating risk After finishing SEC A this would be taken on and we hope to be done

Evaluate the Professional Accountants role in internal control, review and compliance

3 Class for notes with 2 for discussing relevant question i.e. 5 Class Demonstrate the application of professional values and judgment through an ethical framework that is in the best interests of society and the profession, in compliance with relevant professional codes, laws and regulations. Our last two days would focus on getting done with Ethics i.e. By 9th day or the 18th class we can expect to cut the chase of ending the syllabus

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