Directors Duties and the Notion of True and Fair.
|Directors Duties and the notion of True and Fair. |
After the failure of ABC Learning’s, Centro Properties and Hastie Group many companies and their accounts came under scrutiny. The collapses of these high profile company’s had a weighty effect on creditors, customers, employees, government and other stakeholders. The questions raised in each of these cases, is to what extent is it the director’s duty to ensure that the financial statements of a company provide a true and fair value. In answering the above research question, we’ll raised the culpability of directors, the financial causes for each of the three companies, the financial disclosures issues raised, and pinpointing the similarities in each case and ways to prevent such collapses in the future.
Section 285-318 of the Corporations Act, relates to the financial reporting provisions, including directors’ reports, director’s duty to exercise their powers with care and due diligence. For example, failure to sustain accurate financial records the directors may be subject to penalty. Further, Section 297 states that a company’s financial year statements and notes must give a true and fair view of: the financial performances of the company, disclosing entity or registered structure; and the financial position and performance of the consolidated entry if consolidated financial statements are necessary. Supplementary info must be incorporated in the notes to financial statements if the financial statements and notes prepared would not give a true and fair value and or failing to comply with the accounting standards. (Corporations Act 2001).
For the past few years, ABC’s brand is commonly recognised, with a market share of roughly 25%. Up until July 2000 when the federal government announced the childcare subsidy, the childcare industry was hardly moneymaking. It expanded too rapidly, and the huge majority of new Centre’s have
After the failure of ABC Learning’s, Centro Properties and Hastie Group many companies and their accounts came under scrutiny. The collapses of these high profile company’s had a weighty effect on creditors, customers, employees, government and other stakeholders. The questions raised in each of these cases, is to what extent is it the director’s duty to ensure that the financial statements of a company provide a true and fair value. In answering the above research question, we’ll raised the culpability of directors, the financial causes for each of the three companies, the financial disclosures issues raised, and pinpointing the similarities in each case and ways to prevent such collapses in the future.
Section 285-318 of the Corporations Act, relates to the financial reporting provisions, including directors’ reports, director’s duty to exercise their powers with care and due diligence. For example, failure to sustain accurate financial records the directors may be subject to penalty. Further, Section 297 states that a company’s financial year statements and notes must give a true and fair view of: the financial performances of the company, disclosing entity or registered structure; and the financial position and performance of the consolidated entry if consolidated financial statements are necessary. Supplementary info must be incorporated in the notes to financial statements if the financial statements and notes prepared would not give a true and fair value and or failing to comply with the accounting standards. (Corporations Act 2001).
For the past few years, ABC’s brand is commonly recognised, with a market share of roughly 25%. Up until July 2000 when the federal government announced the childcare subsidy, the childcare industry was hardly moneymaking. It expanded too rapidly, and the huge majority of new Centre’s have