Envision is a public quoted company on a reputed stock exchange. As a listed company, Envision's policy manual provides

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Envision is a public quoted company on a reputed stock exchange.As a listed company, Envision's policy manual provides that theinternal audit team should prepare an internal control report everysix months and report to the company's Managing director.Accordingly, the internal audit team had submitted their internalaudit report to the Managing director without failing their duties.The company wanted to issue a prospectus inviting the public tosubscribe to share issues to expand its businesses. The companyfiled the necessary documents to get approval from the stockexchange. The stock exchange delayed the approval and startedinvestigating the company's books of accounts upon severalcomplaints. However, two non-executive directors who felt about theover-gearing ratio upon grape wine (informal information) hadraised questions about the company's liquidity and solvency. Still,the other four executive directors, including the ManagingDirector, had agreed with the explanations given by Mr. Smith foryears. The company convenes its Annual General Meeting once a year.At the AGM, some shareholders frequently raised the issue ofincreasing labour turnover during the last five years. Most of theemployees have resigned from the company to join the company'scompetitors. Further, some shareholders frequently raise the issueof non-adaptation to new technology. However, the majority of theshareholders who attended the AGM did not have sufficient interestin the issue of labour turnover, technology, solvency, andliquidity because the Board has proposed, and shareholders haveapproved dividends for years though there was no increase in theirdividends. Shareholders always relied on the Managing Directors,Human Resource director, and Information director, who frequentlyuttered in their speeches that the market price of shares isincreasing continuously because of new investments, information,and human resource. The stock exchange found that Mr. Smith, themanaging director and the chief executive officer (CEO) of Envisioncompany, had acted in collusion with auditors for years. They hadbeen able to hide the company's liabilities worth more than thecompany's total assets in its subsidiary companies (Companies underthe control of Envision company). When the fraud was disclosed, theshare price fell by 50%. Shareholders requested the Board ofdirectors to maintain an action against the CEO & ManagingDirector. Still, the Board has informed shareholders that Mr. Smithhas acted for the company's benefit. Shareholders who arevulnerable with their investment seek your advice as follows.
1. Introduce a guideline with four points for the properconstitution of the Board. [8 marks]
2. Introduce a guideline for with four points for the audit andassurance procedure of the company [8 marks]
3. Can they maintain a court action against the CEO and theManaging Director [8 marks].