Posted: November 11th, 2015

Answer the following question

Q1) Ethan, Joshua and Daniel are all directors of quality sofa & bed Ltd. The company desperately needed to purchase a warehouse. At a board meeting, Daniel successfully persuaded Ethan and Joshua that on particular warehouse was perfect for the company and that it was worth $140,000. Ethan and Joshua later discovered that Daniel was the owner of the warehouse and it was worth $145,000.

Daniel who is a chartered accountant, is in charge of insuring the company’s warehouse against burglary and fire. He signed an insurance form without checking the content of its policy. The warehouse was burgled and the company suffered a loss of $30,000. The insurance company claimed that the insurance policy did not cover burglary and therefore refused to pay.

Ethan and Joshua recently found out that Daniel offered a cheaper price to a company’s client, Paul Ltd, from which he obtained a personal benefit of $3,000.

Advise Ethan and Joshua as to whether Daniel breached any of his duties as a director of Quality Sofa & Bed.

HINT: (Director Liability Law/ Fiduciary Duty/ Breach Of Duty Care & Loyalty)

Q2) The current financial crisis has shown that corporate governance failed to adhere to its objectives. Discuss the failures that were exposed in the prevailing corporate governance practices.

Q3) One of the attributes to the current financial crises is the failure of corporate governance principles and practices. Explain.

Q4) Discuss how external rent influence the business behavior in a rentier state.

Q5) Discuss the impact of rentier economies on business environment.

Q6) Rentier State is an obstacle for business growth and development. ( Discuss )

Q7)The fact that Kuwait is a rentier state is impacting the business environment negatively. Discuss.

Q8) )Legal systems and regulations can have a negative or positive influence on business. Discuss.