Eleanor's Shareholds in the Comany Assignment Example | Topics and Well Written Essays - 2500 words

Eleanor's Shareholds in the Comany - Assignment Example The director owes a fiduciary relationship to the company; the director has to exercise the duty of care in discharging his/her duty. In Re Smith and Fawcett Ltd, it was held that the directors were required to act â€Å"bona fide in that they consider – not what a court may consider – is in the interests of the company, and not for any collateral purpose. In RE: Marquis of Bute Case where a director who failed to attend a board meeting once in 38yrs was exonerated from being negligence. However, the company is free to impose a duty on directors to attend board meetings iii.The directors may delegate work to some official whose past record may not cast doubts and distrust may be exonerated on negligence on the ground that he exercises due care.this is illustrated in Dovey vs. Cory where it was held that the director was not liable for negligence as he had failed to verify company accounts. It, therefore, implies that the directors can promote the success of the company when he owes the duty of care avoiding negligence. However, the employee’s mistake cannot be bound to be that of directors provided he showed that he acted in good faith. 5. An accountant is a person who prepares the financial statement of a company in line with the IFRS.the quality of information should enable the users of accounts to make accurate and transparent judgments regarding the company’s financial statement. The reports or the books of accounts, for example, the balance sheet and income statement laid in, show the true and fair view of the company at a given period of time. Therefore, on a company’s board of director needs to have an accountant so that he can communicate the economic information to the non-accountant directors for decision-making.