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Activity2 Bruno

The main issue at Hue Incorporated is the Board's lack of understanding of reports from the Internal Chief Auditor due to insufficient information and qualifications of the directors. To address this, it is recommended that the Board disclose relevant information about each member's expertise and potential conflicts of interest. Additionally, the company should establish criteria for selecting an external auditor and ensure transparency regarding non-audit services to maintain independence.

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18 views1 page

Activity2 Bruno

The main issue at Hue Incorporated is the Board's lack of understanding of reports from the Internal Chief Auditor due to insufficient information and qualifications of the directors. To address this, it is recommended that the Board disclose relevant information about each member's expertise and potential conflicts of interest. Additionally, the company should establish criteria for selecting an external auditor and ensure transparency regarding non-audit services to maintain independence.

Uploaded by

mark florence B Bruno
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Case Analysis: Hue Incorporated

Answers:

a. In my opinion the main cause why Hue Incorporated Board does not understand the report given

by Internal Chief Auditor is that he had lack of information and did not comprehend the reports

provided to them by the chief internal auditor, where directors are all executives and no non-

executive problem may arise because all directors are to be appointed to head departments. In the

case, the qualifications of the directors, including educational attainment, adequate competency,

age requirement, integrity, and assiduousness, were not expressed.

b. In order to solve and analyze the identified problem happen in letter “A” each board member's

expertise and qualifications and any potential conflicts of interest that would impair their

judgment, I propose that the Board completely disclose all relevant and material information on

each individual board member and key executive. This is done to ensure the directors are

competent.

c. The company should develop criteria for the suitable selection of an external audit and exercise

effective control of the same in order to guarantee the independence of the external auditor. To

avoid any potential conflicts of interest, the corporation should additionally disclose the non-audit

services that its external auditor does.

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