You are currently employed as an audit senior at For You
Auditors and have been assigned to the audit engagement of Direct
Access (Pty) Ltd for 2022 (hereafter Direct). Direct has a February
year-end.
The Board of Directors of Direct believes in maintaining
exceptional standards of corporate governance, integrity, and
compliance with King IV principles. To perform the tasks assigned
to you in an effective and efficient manner, you need to gain a
thorough understanding of Direct’s business.
The information gathered during your first week performing the
audit engagement has been provided are as follow:
Direct has 4 shareholders, namely:
Server (Pty) Ltd 45%
Mr L Smith 30%
Mr R Loodt 15%
Miss T Beck 10%
Independent, Non-Executive Director.
Member of the social and ethics committee.
He has served as a Non-Executive Director since the inception of
the company in 2003.
Mr Loodt has never been employed by Direct, and the board has
never reviewed his independence.
Non-Executive Director and Chairman of the board.
Chairman of the remuneration committee. Member of the
nominations committee.
Mr Smith was the Chief Executive Officer (CEO) of Direct until
July 2018 and was appointed as the Chairman of the board of
directors by the shareholders on 1 March 2019.
Independent, Non-Executive Director.
Member of the risk committee
Independent, Non-Executive Director.
Chairman of the risk committee. Member of the audit
committee.
Non-Executive Director.
Chairman of the social and ethics committee. Member of the risk
committee
Non-Executive Director.
Member of the nominations committee.
Member of the social and ethics committee
Financial Director.
Chairman of the audit committee.
Member of the remuneration committee.
Chief Executive Officer (CEO).
Member of the nominations committee
Operations Director.
Member of the nominations committee.
Member of the remuneration committee.
Performance measures of the Board:
The performance review of the Board of Directors as a whole and
of the individual directors are conducted on an annual basis as
follows:
• Mr. Smith’s performance was assessed at one of the Directors’
meetings. The evaluation was performed by the Directors, under the
guidance of the Financial Director, Mr Adams. • The Board of
Directors’ performance evaluation was also conducted by Mr
Adams.
Required:
Discuss any concerns you may have regarding Direct Access (Pty)
Ltd.’s application of the recommended practices contained in the
King IV Report.
You are currently employed as an audit senior at For You Auditors and have been assigned to the audit engagement of Dire
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