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Exam style questions and answers

In which of the following ways did the remuneration committee fail to
carry out its’ roles effectively? Select all that apply.

A The remuneration committee was entirely made up of Non- Executive
directors with no direct experience of working within Q.

B The remuneration committee took the views of the Finance Director into
account.

C The remuneration committee agreed an illegal pension award for Mr Chat.

D The remuneration committee included ex colleagues of Mr Chat.

E The remuneration committee took Mr Chat’s own requests into account.

14 The remuneration committee of C meet annually to decide on executive
rewards for the forthcoming financial year. The committee is made up of non-
executive directors.

The committee considers market rates, the company’s overall strategy and the
link with performance when setting rewards. The strategy of C in the next few
years is to incentivise medium to long term growth whilst retaining the existing
executive board in place as long as possible.

Which of the following components of a reward package might fit with C’s
strategy? Select all that apply.

A Basic salary that meets market rate

B Loyalty Bonus

C Pension, payable regardless of performance

D Annual profit based bonus

E Share options

15 RTF Limited is a chain of four homeware stores in the Midlands. They sell
readymade curtains, curtain material, curtain poles, cushions, mirrors, bedding,
etc. They operate from out of town sites in large warehouse type stores. There
is ample parking around the warehouse, and a small cafe in each.

RTF employs around 200 staff in total, about half full-time and half part-time.
The board is made up of the Falconbridge family. The grandfather - Richard
Thomas Falconbridge, set up the company in 1975.

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