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Appendix 2
9 A, B, D
A: If the IT system has not been updated to reflect the new reduced prices then
it is likely that old prices will still be charged.
B: Management rely on the information generated by systems to inform them of
any problems, for example deviations from standard costs. The new standard
costs will be lower than the old and unless these are up to date, management
will not receive meaningful variances.
C: There is no indication that raw materials will change, simply the amounts
purchased will be higher at times.
D: The new strategy involves only selling to customers who purchase in bulk in
order to make a profit on reduced prices. Unless the system is updated, orders
may be accepted for fewer units than are feasible.
E: The systems are integrated across all the divisions so it is unlikely that some
will follow the new strategy and others will not.
10 B, D, E
A: Although this would ensure the directors knew whether or not the site had
been hacked, it would go against the approach to journalism which Roar’s
reputation is built on.
B: This may help to detect attempted hacking but only if the hacker gets the
password wrong on first attempts.
C: Would not be particularly helpful given that not all staff work in the office.
D: This would prevent content from simply being removed if the journalist felt
under threat. It would also allow management some control over what remained
on the site.
E: This would prevent confusion over whether or not articles had been
tampered with.
11 A, B, C
A: The fact that investors have expressed concerns over the strategy and risk
makes this an important advantage.
B: The new executive directors may not have enough industry knowledge and
through a nominations committee, the NED’s could ensure that specialist
knowledge is recruited to the board.
C: NED’s have a monitoring role and since the strategy has been criticised as
excessively risky they could monitor it on behalf of the shareholders.
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