Reference no: EM13315698
OHS Solutions Pty. Ltd. is a company formed by three friends (Des, Satish and Emma) who bring different skills and abilities to the business. Emma is an accounting graduate, Des has expertise in occupational health and safety (OHS) and Satish has an IT degree. They decided to start up a business which would provide a portal through which the public and businesses could access (for free) information on all aspects of OHS. OHS Solutions would finance its business, and make profits, by charging businesses to advertise via their website.
The directors of OHS Solutions are:
Managing Director - Des
Finance Director - Emma (non executive)
Director - Satish (executive - employed also to run the technological side of the business)
Director - Ying (non executive) - a friend of Des' and director of Support Pty. Ltd. (Support Pty. Ltd. has gone guarantor for a $50,000 loan from the Business Bank Ltd. to OHS Solutions)
The Shareholders of OHS Solutions (holding equal amounts of ordinary shares) are Des, Emma, Satish and Support Pty. Ltd.
As at January 2007 OHS Solutions had been operating for six months. It had some initial IT problems which prevented some of the advertisers' material from being accessed. In order to try to help overcome these technical problems Satish engaged Trouble Shooters Pty. Ltd.
At the February Board meeting, Satish reported that two businesses who had paid to advertise on the website were dissatisfied with what was happening and were threatening to sue for breach of contract. Emma was unable to table any financial information as the employee who had been doing the accounts had been sick and when Emma looked at the records she found that they seemed to be in a bit of a mess. She did find a large account from Trouble Shooters that was over due. Des reported that he was disturbed by this news. He had been told by Satish that the IT problems had been fixed since Trouble Shooters had been engaged, and he had just signed a $10,000 advertising contract with Promotions Plus Pty. Ltd. to advertise the website and signed up to go to a trade show to be held in conjunction with a forthcoming OHS conference. He said this was needed because a number of high profile advertisers were threatening to discontinue their association with OHS Solutions unless the portal became better known.
Ying just listens in disbelief at the March Board meeting. It seemed to her that OHS Solutions is being poorly managed and is failing to make the most of a potentially profitable business opportunity. This could present an opportunity for Support Pty. Ltd. to make an offer to buy OHS Solutions at a good price. On the other hand Support Pty. Ltd. is exposed as a guarantor.
Assume she consults you, an accountant, for your preliminary view about the predicament of OHS Solutions and what she should do. Assume also that the first thing that comes to your mind is whether Ying herself may be vulnerable as a director of OHS Solutions for failing to prevent OHS Solutions from trading when it is insolvent.
YOUR TASK
Part A
Write a brief explanation about why the directors' duty to prevent insolvent trading exists and the circumstances and consequences of the 'veil of incorporation' being lifted for insolvent trading. (Do not just repeat the words of the relevant sections in the Corporations Act).
And
Part B
From what you know of OHS Solutions' predicament, DISCUSS whether any of the directors may be about to breach or have already breached the duty to prevent insolvent trading. (In order to do this you will need to compare what is happening in OHS Solutions case with other precedent cases and refer to the relevant sections in the Corporations Act.) What will you advise Ying?
|
Determine the release speed of the shell
: The tank is shelling at a target that is 4km away and 60m above ground. If the shell is being fired at 30degrees above the horizontal, determine the release speed of the shell
|
|
Create a list of managers and supervisors
: Your company wants to encourage carpooling. Create an answer table listing employee name, city and street address (in that order) for employees who live in Crestline.
|
|
Find how much torque does the aircraft engine provide
: The engine of an aircraft propeller delivers an amount of power 179hp to the propeller at a rotational velocity of 2310rev/min. How much torque does the aircraft engine provide
|
|
What is the voltage between the plates
: Two parallel conducting plates are separated by 10.0 cm, and one of them is taken to be at zero volts. What is the voltage between the plates
|
|
Why the directors duty to prevent insolvent trading
: Write a brief explanation about why the directors' duty to prevent insolvent trading exists and the circumstances and consequences of the 'veil of incorporation' being lifted for insolvent trading.
|
|
Determine the flux through the side of the cylinder
: A long straight wire of diameter 2.33 mm and length 5.28 meters has a charge of 0.0388 coulomb uniformly distributed along it. Determine the flux through the side of the cylinder
|
|
Assume that the null hypothesis is right
: Mr. Jones knows that over many years the mean Math SAT score of students who graduate from Irvine Remedial High School is 300, and the distribution is approximately normal, and the standard deviation is wellknown to be 100. He picks 16 students at ra..
|
|
How far will the officer have to drive
: A police officer spots a speeding car traveling at 20 m/s (approximately 44 mph) as it passes. How far will the officer have to drive before catching up to the speeding car
|
|
What propulsive force was necessary to attain muzzle speed
: The largest-caliber antiaircraft gun operated by the German air force during World War II was the 12.8 cm Flak 40. What propulsive force was necessary to attain the muzzle speed
|