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    1. Scenario.

    Shelagh is the managing director of AlphaPlus plc, a successful internet marketing company, having a salary of £1.2m. Its articles of association contain the following provision:

    “Remuneration of directors
    The annual remuneration of the company’s directors shall, be determined by the Board, provided that, without the express consent of the general meeting, such remuneration shall not exceed £1.5m in any calendar year.”

    Shelagh was paid an additional fee of £1m for negotiating the company’s successful takeover of Clicksales Ltd (a competitor company) The extra payment was agreed by the Acquisitions Committee of the AlphaPlus Board, and not reported to the general meeting until one year later.

    Shelagh and her son formed a private company, Bestwebz Ltd, to design and sell websites. Without disclosing her involvement with Bestwebz Ltd Shelagh established a preferred suppliers list for website design on which Bestwebz Ltd was identified as the “first choice company”. In the first year of this relationship over £2m of work was placed with Bestwebz Ltd.

    Glitz, one of the company’s major clients, failed to pay AlphaPlus £1.5m for marketing services within the 60 day credit period allowed by AlphaPlus. The Board of Directors instructed Jerry, the Finance Director, to take action to recover payment from Glitz. Jerry negligently failed to do this, and six months later Glitz went into liquidation, leaving large debts and no assets.

    With the agreement of the Board of AlphaPlus plc Shelagh negotiated the outsourcing of the company’s online services from Manchester to the Mumbai Marketing Company, leading to the loss of 100 jobs in Manchester.


    Advise AlphaPlus in relation to each of the scenarios above.

    Due in 2 days and struggling to form an argument, any help would be much appreciated.
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    (Original post by username3807818)
    1. Scenario.

    Shelagh is the managing director of AlphaPlus plc, a successful internet marketing company, having a salary of £1.2m. Its articles of association contain the following provision:

    “Remuneration of directors
    The annual remuneration of the company’s directors shall, be determined by the Board, provided that, without the express consent of the general meeting, such remuneration shall not exceed £1.5m in any calendar year.”

    Shelagh was paid an additional fee of £1m for negotiating the company’s successful takeover of Clicksales Ltd (a competitor company) The extra payment was agreed by the Acquisitions Committee of the AlphaPlus Board, and not reported to the general meeting until one year later.

    Shelagh and her son formed a private company, Bestwebz Ltd, to design and sell websites. Without disclosing her involvement with Bestwebz Ltd Shelagh established a preferred suppliers list for website design on which Bestwebz Ltd was identified as the “first choice company”. In the first year of this relationship over £2m of work was placed with Bestwebz Ltd.

    Glitz, one of the company’s major clients, failed to pay AlphaPlus £1.5m for marketing services within the 60 day credit period allowed by AlphaPlus. The Board of Directors instructed Jerry, the Finance Director, to take action to recover payment from Glitz. Jerry negligently failed to do this, and six months later Glitz went into liquidation, leaving large debts and no assets.

    With the agreement of the Board of AlphaPlus plc Shelagh negotiated the outsourcing of the company’s online services from Manchester to the Mumbai Marketing Company, leading to the loss of 100 jobs in Manchester.


    Advise AlphaPlus in relation to each of the scenarios above.

    Due in 2 days and struggling to form an argument, any help would be much appreciated.
    What's your take so far? Fairly clear to me.
    Clawback on the £1m bonus for Clicksales Ltd, it breaches articles.

    She didn't declare her involvement with Bestwebz Ltd, so she needs to remove herself from that business with immediate effect, possible conflict of interest.

    Jerry should be fired.

    The outsourcing, good. What effect though? Did it save money or cost? What about reputation?
 
 
 
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