Conduct research about the ‘Centro case’, described in the Australian Financial Review article by Adele Ferguson:...

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Accounting

Conduct research about the ‘Centro case’, described in theAustralian Financial Review article by Adele Ferguson: “Dick Smithdirectors hit with legal action from receiver”.
Using the AREA framework, find parallels of the situation ofDick Smith with the Centro case. Discuss with your group in class,the role of the board of directors as well as their relationshipwith the executive management of a company and consider whetherdirectors should be held personally liable in these cases.
ANALYSE:(30-50words):Identify the issue and whyit matters. Detemine what you find out.
RESAERCH:(200-250 words): Present relevantfacts and evidence, or issues.
EVALUATE & ANSWER:(200-250 words): Provideyour opinion of these themes or issues you have identified,justified by the evidence you have gathered and evaluated.

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Identify the issue and why it matters Determine what you find out What did the Centro directors do wrong What did the D Smith directors do wrong What was the role of the directors in each case How was this role breached Who is liable in each case What were the punishments Present relevant facts and evidence or issues Centro Case Judge found that directors breached their duties when they approved financial statements for 200607 without disclosing that Centro was required to repay billions of debt within months The debts no disclosed in the financial statements were well known by directors Error included 11 Billion debt that arose due to misinterpretation of the accounting standards for shortterm deb The directors of Centro did not examine closely the final reports and claim they only need financial literacy not a working knowledge of See Answer

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