1. Read the following passage carefully and answer the questions. Certain words/phrases are given in bold to help you locate them while answering some of the questions. Most of the declarations of the Fourth World Conference on Women in Beijing in 1995 have faded from memory. But the linkage made there between women’s rights and poverty and the assumption that discrimination actually impedes progress-has survived. Since then the promotion of equal rights has become a central economic priority for international aid aeencies. The World Bank has declared the enfranchisement of women. the single most important issue for effective development. A sweeping statement, perhaps, but since 1805 the bank has lent billions of dollars on programmes that encourage, girls’ education, better maternal health and on micro-credit initiatives that funnel money directly into the hands of women. This is a substantial sum dedicated to women. If not, most developing countries, women produce more food than men and bear primary responsibility for feeding, sheltering and educating the young. But lack of education coupled with social customs which treat women as secondclass citizens restrict their participation in the economy. The figures are starting. Globally those women who do work are concentrated at the bottom end of the labour market and receive far less pay. A significant proportion of the world’s illiterate are women and women account for half of all refugees. Anything that helps women catch up with men should be welcomed on grounds of equity alone. But fairer treatment of women is also one of the most effective ways to improve an economy’s efficiency as well. It is widely recognised educating more women in developing countries and specifically making education available to men and women equally is likely to raise the productive potential of an economy significantly. As education levels rise, so do household incomes. In Sub-Saharan Africa, for instance, 70% of young children whose mothers have secondary information receive their vaccinations, as opposed to just 30% of those whose mothers have no formal schooling at all. A cross-country analysis concluded that gains in women’s education made the single largest contribution to declines in malnutrition in 13 countries between 1970 and 1995. Some researchers reckon that, if female farmers in places like Cameron or Kenya were afforded the same schooling and other opportunities as male farmers, crop yields would rise quite hefty. One economic analysis estimates that, if countries in South Asia, Africa and the Middle East had closed the gender gap in schooling at the same rate as East Asia after 1960. Income per head could have grown substantially over the actual growth rates achieved. But one country’s gender bias is another’s ancient tradition, entrenched in laws and institutions. Some South American Countries, like Bolivia and Guatemala restrict wives employment outside the home in South African nations like Botswana, women have no independent right to manage of own land but now girls are offered stipends for secondary education- a long standing programme now holstered by multilateral aid. Elsewhere in Africa in Ghana, peripatetic bankers act as lenders and financial advisors, often helping women as particular to set up small businesses. Part of the rationale for micro-finance (small icons) that caters to women is that some studies have shown women tend to spend money more prudently on vital goods and services that benefit families, men often squander it. This finding may seem implausible to many men. Not many women would be surprised.Which of the following is an appropriate title for the passage ?
 






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MCQ-> Read the following passage carefully and answer the questions. Certain words/phrases are given in bold to help you locate them while answering some of the questions. Most of the declarations of the Fourth World Conference on Women in Beijing in 1995 have faded from memory. But the linkage made there between women’s rights and poverty and the assumption that discrimination actually impedes progress-has survived. Since then the promotion of equal rights has become a central economic priority for international aid aeencies. The World Bank has declared the enfranchisement of women. the single most important issue for effective development. A sweeping statement, perhaps, but since 1805 the bank has lent billions of dollars on programmes that encourage, girls’ education, better maternal health and on micro-credit initiatives that funnel money directly into the hands of women. This is a substantial sum dedicated to women. If not, most developing countries, women produce more food than men and bear primary responsibility for feeding, sheltering and educating the young. But lack of education coupled with social customs which treat women as secondclass citizens restrict their participation in the economy. The figures are starting. Globally those women who do work are concentrated at the bottom end of the labour market and receive far less pay. A significant proportion of the world’s illiterate are women and women account for half of all refugees. Anything that helps women catch up with men should be welcomed on grounds of equity alone. But fairer treatment of women is also one of the most effective ways to improve an economy’s efficiency as well. It is widely recognised educating more women in developing countries and specifically making education available to men and women equally is likely to raise the productive potential of an economy significantly. As education levels rise, so do household incomes. In Sub-Saharan Africa, for instance, 70% of young children whose mothers have secondary information receive their vaccinations, as opposed to just 30% of those whose mothers have no formal schooling at all. A cross-country analysis concluded that gains in women’s education made the single largest contribution to declines in malnutrition in 13 countries between 1970 and 1995. Some researchers reckon that, if female farmers in places like Cameron or Kenya were afforded the same schooling and other opportunities as male farmers, crop yields would rise quite hefty. One economic analysis estimates that, if countries in South Asia, Africa and the Middle East had closed the gender gap in schooling at the same rate as East Asia after 1960. Income per head could have grown substantially over the actual growth rates achieved. But one country’s gender bias is another’s ancient tradition, entrenched in laws and institutions. Some South American Countries, like Bolivia and Guatemala restrict wives employment outside the home in South African nations like Botswana, women have no independent right to manage of own land but now girls are offered stipends for secondary education- a long standing programme now holstered by multilateral aid. Elsewhere in Africa in Ghana, peripatetic bankers act as lenders and financial advisors, often helping women as particular to set up small businesses. Part of the rationale for micro-finance (small icons) that caters to women is that some studies have shown women tend to spend money more prudently on vital goods and services that benefit families, men often squander it. This finding may seem implausible to many men. Not many women would be surprised.Which of the following is an appropriate title for the passage ?
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MCQ-> Read the following passages carefully and answer the questions given at the end of each passage.PASSAGE 3Typically women participate in the labour force at a very high rate in poor rural countries. The participation rate then falls as countries industrialise and move into the middle income class. Finally, if the country grows richer still, more families have the resources for higher education for women and from there they often enter the labour force in large numbers. Usually, economic growth goes hand in hand with emancipation of women. Among rich countries according to a 2015 study, female labour force participation ranges from nearly 80 percent in Switzerland to 70 percent in Germany and less than 60 Percent in the United States and Japan. Only 68 Percent of Canadian omen participated in the workforce in 1990; two decades later that increased to 74 Percent largely due to reforms including tax cuts for second earners and new childcare services. In Netherlands the female labour participation rate doubled since 1980 to 74 Percent as a result of expanded parental leave policies and the spread of flexible, part time working arrangements. In a 2014 survey of 143 emerging countries, the World Bank found that 90 Percent have at least one law that limits the economic opportunities available to women. These laws include bans or limitations on women owning property, opening a bank account, signing a contract, entering a courtroom, travelling alone, driving or controlling family finances. Such restrictions are particularly prevalent in the Middle East and South Asia with the world’s lowest female labour force participation, 26 and 35 percent respectively. According to date available with the International Labour Organisation (ILO), between 2004 and 2011, when the Indian economy grew at a healthy average of about 7 percent, there was a decline in female participation in the country’s labour force from over 35 percent to 25 percent. India also posted the lowest rate of female participation in the workforce among BRIC countries. India’s performance in female workforce participation stood at 27 percent, significantly behind China (64 percent), Brazil (59 percent), Russian Federation (57 percent), and South Africa (45 percent). The number of working women in India had climbed between 2000 and 2005, increasing from 34 percent to 37 percent, but since then the rate of women in the workforce has to fallen to 27 percent as of 2014, said the report citing data from the World Bank. The gap between male and female workforce participation in urban areas in 2011 stood at 40 percent, compared to rural areas where the gap was about 30 percent. However, in certain sectors like financial services, Indian women lead the charge. While only one in 10 Indian companies are led by women, more than half of them are in the financial sector. Today, women head both the top public and private banks in India. Another example is India’s aviation sector, 11.7 percent of India’s 5,100 pilots are women, versus 3 percent worldwide. But these successes only represent a small of women in the country. India does poorly in comparison to its neighbours despite a more robust economic growth. In comparison to India, women in Bangladesh have increased their participation in the labour market, which is due to the growth of the ready- made garment sector and a push to rural female employment. In 2015, women comprised of 43 percent of the labour force in Bangladesh. The rate has also increased in Pakistan, albeit from a very low starting point, while participation has remained relatively stable in Sri Lanka. Myanmar with 79 percent and Malaysia with 49 percent are also way ahead of India. Lack of access to higher education, fewer job opportunities, the lack of flexibility in working conditions, as well as domestic duties are cited as factors behind the low rates. Marriage significantly reduced the probability of women working by about 8 percent in rural areas and more than twice as much in urban areas, said an Assocham report. ILO attributes this to three factors: increasing educational enrolment, improvement in earning of male workers that discourage women’s economic participation, and lack of employment opportunities at certain levels of skills and qualifications discouraging women to seek work. The hurdles to working women often involve a combination of written laws and cultural norms. Cultures don’t change overnight but laws can. The IMF says that even a small step such as countries granting women the right to open a bank account can lead to substantial increase in female labour force participation over the next seven years. According to the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), even a 10 percent increase in women participating in the workforce can boost gross domestic product (GDP) by 0.3 percent. The OECD recently estimated that eliminating the gender gap would lead to an overall increase in GDP of 12 percent in its member nations between 2015 and 2030. The GDP gains would peak close to 20 percent in both Japan and South Korea and more than 20 percent in Italy. A similar analysis by Booz and Company showed that closing gender gap in emerging countries could yield even larger gains in GDP by 2020, ranging from a 34 percent gain in Egypt to 27 percent in India and 9 percent in Brazil. According to the above passage, though there are many reasons for low female labour force participation, the most important focus of the passage is on
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MCQ-> Read the following passage carefully and answer the questions given below it. Certain words/phrases have been printed in bold tohelp you locate them while answering some of the questions. During the last few years, a lot of hype has been heaped on the BRICS (Brazil, Russia, India, China, and South Africa). With their large populations and rapid growth, these countries, so the argument goes, will soon become some of the largest economies in the world and, in the case of China, the largest of all by as early as 2020. But the BRICS, as well as many other emerging-market economieshave recently experienced a sharp economic slowdown. So, is the honeymoon over? Brazil’s GDP grew by only 1% last year, and may not grow by more than 2% this year, with its potential growth barely above 3%. Russia’s economy may grow by barely 2% this year, with potential growth also at around 3%, despite oil prices being around $100 a barrel. India had a couple of years of strong growth recently (11.2% in 2010 and 7.7% in 2011) but slowed to 4% in 2012. China’s economy grew by 10% a year for the last three decades, but slowed to 7.8% last year and risks a hard landing. And South Africa grew by only 2.5% last year and may not grow faster than 2% this year. Many other previously fast-growing emerging-market economies – for example, Turkey, Argentina, Poland, Hungary, and many in Central and Eastern Europe are experiencing a similar slowdown. So, what is ailing the BRICS and other emerging markets? First, most emerging-market economies were overheating in 2010-2011, with growth above potential and inflation rising and exceeding targets. Many of them thus tightened monetary policy in 2011, with consequences for growth in 2012 that have carried over into this year. Second, the idea that emerging-market economies could fully decouple from economic weakness in advanced economies was farfetched : recession in the eurozone, near-recession in the United Kingdom and Japan in 2011-2012, and slow economic growth in the United States were always likely to affect emerging market performance negatively – via trade, financial links, and investor confidence. For example, the ongoing euro zone downturn has hurt Turkey and emergingmarket economies in Central and Eastern Europe, owing to trade links. Third, most BRICS and a few other emerging markets have moved toward a variant of state capitalism. This implies a slowdown in reforms that increase the private sector’s productivity and economic share, together with a greater economic role for state-owned enterprises (and for state-owned banks in the allocation of credit and savings), as well as resource nationalism, trade protectionism, import substitution industrialization policies, and imposition of capital controls. This approach may have worked at earlier stages of development and when the global financial crisis caused private spending to fall; but it is now distorting economic activity and depressing potential growth. Indeed, China’s slowdown reflects an economic model that is, as former Premier Wen Jiabao put it, “unstable, unbalanced, uncoordinated, and unsustainable,” and that now is adversely affecting growth in emerging Asia and in commodity-exporting emerging markets from Asia to Latin America and Africa. The risk that China will experience a hard landing in the next two years may further hurt many emerging economies. Fourth, the commodity super-cycle that helped Brazil, Russia, South Africa, and many other commodity-exporting emerging markets may be over. Indeed, a boom would be difficult to sustain, given China’s slowdown, higher investment in energysaving technologies, less emphasis on capital-and resource-oriented growth models around the world, and the delayed increase in supply that high prices induced. The fifth, and most recent, factor is the US Federal Reserve’s signals that it might end its policy of quantitative easing earlier than expected, and its hints of an even tual exit from zero interest rates. both of which have caused turbulence in emerging economies’ financial markets. Even before the Fed’s signals, emergingmarket equities and commodities had underperformed this year, owing to China’s slowdown. Since then, emerging-market currencies and fixed-income securities (government and corporate bonds) have taken a hit. The era of cheap or zerointerest money that led to a wall of liquidity chasing high yields and assets equities, bonds, currencies, and commodities – in emerging markets is drawing to a close. Finally, while many emerging-market economies tend to run current-account surpluses, a growing number of them – including Turkey, South Africa, Brazil, and India – are running deficits. And these deficits are now being financed in riskier ways: more debt than equity; more short-term debt than longterm debt; more foreign-currency debt than local-currency debt; and more financing from fickle cross-border interbank flows. These countries share other weaknesses as well: excessive fiscal deficits, abovetarget inflation, and stability risk (reflected not only in the recent political turmoil in Brazil and Turkey, but also in South Africa’s labour strife and India’s political and electoral uncertainties). The need to finance the external deficit and to avoid excessive depreciation (and even higher inflation) calls for raising policy rates or keeping them on hold at high levels. But monetary tightening would weaken already-slow growth. Thus, emerging economies with large twin deficits and other macroeconomic fragilities may experience further downward pressure on their financial markets and growth rates. These factors explain why growth in most BRICS and many other emerging markets has slowed sharply. Some factors are cyclical, but others – state capitalism, the risk of a hard landing in China, the end of the commodity supercycle -are more structural. Thus, many emerging markets’ growth rates in the next decade may be lower than in the last – as may the outsize returns that investors realised from these economies’ financial assets (currencies, equities. bonds, and commodities). Of course, some of the better-managed emerging-market economies will continue to experitnce rapid growth and asset outperformance. But many of the BRICS, along with some other emerging economies, may hit a thick wall, with growth and financial markets taking a serious beating.Which of the following statement(s) is/are true as per the given information in the passage ? A. Brazil’s GDP grew by only 1% last year, and is expected to grow by approximately 2% this year. B. China’s economy grew by 10% a year for the last three decades but slowed to 7.8% last year. C. BRICS is a group of nations — Barzil, Russia, India China and South Africa.....
MCQ-> Read the following passage carefully and answer the questions given below it. Certain words/phrases have been given in bold to help you locate them while answering some of the questions: In every religion, culture and civilization feeding the poor and hungry is considered one of the most noble deeds. However such large scale feeding will require huge investment both in resources and time. A better alternative is to create conditions by which proper wholesome food is available to all the rural poor at affordable price. Getting this done will be the biggest charity.Our work with the rural poor in villages of Western Maharashtra has shown that most of these people are landless laborers. After working the whole day in the fields in scorching sun they come home in the evening and have to cook for the whole family. The cooking is done on the most primitive chulha (wood stove) which results in tremendous indoor air pollution. Many of them also have no electricity so they use primitive and polluting kerosene lamps. World Health Organization (WHO) data has shown that about 300,000 deaths/ year in India can be directly attributed to indoor air pollution in such -nuts. At the same time this pollution results in many respiratory ailments and these people spend close Rs. 200-400 per month on medical bills. Besides the pollution, rural poor also eat very poor diet. They eat  whatever is available daily at Public Distribution System (PDS) shops and most of the times these shops are out of rations. Thus they cook whatever is available. The hard work together with poor eating takes a heavy toll on their health. Besides this malnutrition also affects the physical and mental health of their children and may lead to creation of a whole generation of mentally challenged citizens. So I feel that the best way to provide adequate food for rural poor is by setting up rural restaurants on large scale. These restaurants will be similar to regular ones but for people below poverty line (BPL) they will provide meals at subsidized rates. These citizens will pay only Rs. 10 per meal and the rest, which is expected to be quite small, will come as a part of Government subsidy. With existing open market prices of vegetables and groceries average cost of simple meal for a family of four comes to Rs. 50 per meal or Rs. 12.50 per person per meal. If the PDS prices are taken for the groceries then the average cost will be Rs. 7.50 per person per meal. This makes the subsidy approximately Rs. 2.50 per person per meal only and hence quite small. The buying of meals could be by the use of UID (Aadhar) card by rural poor. The total cost should be Rs. 30 per day for three vegetarian meals of breakfast, lunch and dinner. The rural poor will get better nutrition and tasty food by eating  in these restaurants. Besides the time saved can be used for resting and other gainful activities like teaching children. Since the food will not be cooked in huts, this strategy will result in less pollution in rural households. This will be beneficial for their health. Besides, women's chores will be reduced drastically. Another advantage of eating in these restaurants will be increased social interaction of rural poor since this could also become a meeting place. Eating in restaurants will also require fewer utensils in house and hence less expenditure. For other things like hot water for bath, making tea, boiling milk and cooking on holidays some utensils and fuel will be required. Our Institute NARI has developed an extremely efficient and environment-friendly stove which provides simultaneously both light and heat for cooking and hence may provide the necessary functions. Providing reasonably priced wholesome food is the basic aim and program of Government of India (GOI). This is the basis of their much touted food security  program.However in 65years they have not been able to do so. Thus I feel a public private partnership can help in this. To help the restaurant owners the GOI or state Governments should provide them with soft loans and other line of credit for setting up such facilities. Corporate world can take this up as a part of their corporate social responsibility activity. Their participation will help ensure good quality restaurants and services. Besides the charitable work, this will also make good business sense. McDonald's-type restaurant systems for rural areas can be a good model to be set up for quality control both in terms of hygiene and in terms of quality of food material. However focus will be on availability of wholesome simple vegetarian food in these restaurants.More clientele (volumes) will make these restaurants economical. Existing models of dhabas, udipi type restaurants etc. can be used in this scheme. These restaurants may also be able to provide midday meals in rural schools. At present the midday meal program is faltering due to various reasons. Food coupons in western countries provide cheap food for poor. However quite a number of fast food restaurants in US do not accept them. Besides these coupons are most of the times used for non-food items, it will be mandatory for rural restaurants to accept payment via UID cards for BPL citizens. Existing soup kitchens, lagers and temple food are based on charity. For large scale rural use it should be based on good social enterprise  business model. Cooking food in these restaurants will also result in much more efficient use of energy since energy/ kg of food cooked in households is greater than that in restaurants. The main thing however will be to reduce drastically the food wastage In these restaurants. Rural restaurants can also be forced to use clean fuels like LPG or locally produced biomass-based liquid fuels. This strategy is very difficult to enforce for individual households. Large scale employment generation in rural areas may result because of this activity. With an average norm of 30 people employed/ 100-chair restaurant, this program has the potential of generating about 20 million jobs permanently in rural areas. Besides the infrastructure development in setting up restaurants and establishing the food chain etc will help the local farmers and will create huge wealth generation in these areas. In the long run this strategy may provide better food security for rural poor than the existing one which is based on cheap food availability in PDS - a system which is prone to corruption and leakage.In accordance with the view expressed by the writer of this article, what is the biggest charity ?
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MCQ-> Read carefully the four passages that follow and answer the questions given at the end of each passage:PASSAGE I The most important task is revitalizing the institution of independent directors. The independent directors of a company should be faithful fiduciaries protecting, the long-term interests of shareholders while ensuring fairness to employees, investor, customer, regulators, the government of the land and society. Unfortunately, very often, directors are chosen based of friendship and, sadly, pliability. Today, unfortunately, in the majority of cases, independence is only true on paper.The need of the hour is to strengthen the independence of the board. We have to put in place stringent standards for the independence of directors. The board should adopt global standards for director-independence, and should disclose how each independent director meets these standards. It is desirable to have a comprehensive report showing the names of the company employees of fellow board members who are related to each director on the board. This report should accompany the annual report of all listed companies. Another important step is to regularly assess the board members for performance. The assessment should focus on issues like competence, preparation, participation and contribution. Ideally, this evaluation should be performed by a third party. Underperforming directors should be allowed to leave at the end of their term in a gentle manner so that they do not lose face. Rather than being the rubber stamp of a company’s management policies, the board should become a true active partner of the management. For this, independent directors should be trained in their in their in roles and responsibilities. Independent directors should be trained on the business model and risk model of the company, on the governance practices, and the responsibilities of various committees of the board of the company. The board members should interact frequently with executives to understand operational issues. As part of the board meeting agenda, the independent directors should have a meeting among themselves without the management being present. The independent board members should periodically review the performance of the company’s CEO, the internal directors and the senior management. This has to be based on clearly defined objective criteria, and these criteria should be known to the CEO and other executive directors well before the start of the evolution period. Moreover, there should be a clearly laid down procedure for communicating the board’s review to the CEO and his/her team of executive directors. Managerial remuneration should be based on such reviews. Additionally, senior management compensation should be determined by the board in a manner that is fair to all stakeholders. We have to look at three important criteria in deciding managerial remuneration-fairness accountability and transparency. Fairness of compensation is determined by how employees and investors react to the compensation of the CEO. Accountability is enhanced by splitting the total compensation into a small fixed component and a large variable component. In other words, the CEO, other executive directors and the senior management should rise or fall with the fortunes of the company. The variable component should be linked to achieving the long-term objectives of the firm. Senior management compensation should be reviewed by the compensation committee of the board consisting of only the independent directors. This should be approved by the shareholders. It is important that no member of the internal management has a say in the compensation of the CEO, the internal board members or the senior management. The SEBI regulations and the CII code of conduct have been very helpful in enhancing the level of accountability of independent directors. The independent directors should decide voluntarily how they want to contribute to the company. Their performance should decide voluntarily how they want to contribute to the company. Their performance should be appraised through a peer evaluation process. Ideally, the compensation committee should decide on the compensation of each independent director based on such a performance appraisal. Auditing is another major area that needs reforms for effective corporate governance. An audit is the Independent examination of financial transactions of any entity to provide assurance to shareholder and other stakeholders that the financial statements are free of material misstatement. Auditors are qualified professionals appointed by the shareholders to report on the reliability of financial statements prepared by the management. Financial markets look to the auditor’s report for an independent opinion on the financial and risk situation of a company. We have to separate such auditing form other services. For a truly independent opinion, the auditing firm should not provide services that are perceived to be materially in conflict with the role of the auditor. These include investigations, consulting advice, sub contraction of operational activities normally undertaken by the management, due diligence on potential acquisitions or investments, advice on deal structuring, designing/implementing IT systems, bookkeeping, valuations and executive recruitment. Any departure from this practice should be approved by the audit committee in advance. Further, information on any such exceptions must be disclosed in the company’s quarterly and annual reports. To ensure the integrity of the audit team, it is desirable to rotate auditor partners. The lead audit partner and the audit partner responsible for reviewing a company’s audit must be rotated at least once every three to five years. This eliminates the possibility of the lead auditor and the company management getting into the kind of close, cozy relationship that results in lower objectivity in audit opinions. Further, a registered auditor should not audit a chief accounting office was associated with the auditing firm. It is best that members of the audit teams are prohibited from taking up employment in the audited corporations for at least a year after they have stopped being members of the audit team.A competent audit committee is essential to effectively oversee the financial accounting and reporting process. Hence, each member of the audit committee must be ‘financially literate’, further, at least one member of the audit committee, preferably the chairman, should be a financial expert-a person who has an understanding of financial statements and accounting rules, and has experience in auditing. The audit committee should establish procedures for the treatment of complaints received through anonymous submission by employees and whistleblowers. These complaints may be regarding questionable accounting or auditing issues, any harassment to an employee or any unethical practice in the company. The whistleblowers must be protected. Any related-party transaction should require prior approval by the audit committee, the full board and the shareholders if it is material. Related parties are those that are able to control or exercise significant influence. These include; parent- subsidiary relationships; entities under common control; individuals who, through ownership, have significant influence over the enterprise and close members of their families; and dey management personnel.Accounting standards provide a framework for preparation and presentation of financial statements and assist auditors in forming an opinion on the financial statements. However, today, accounting standards are issued by bodies comprising primarily of accountants. Therefore, accounting standards do not always keep pace with changes in the business environment. Hence, the accounting standards-setting body should include members drawn from the industry, the profession and regulatory bodies. This body should be independently funded. Currently, an independent oversight of the accounting profession does not exist. Hence, an independent body should be constituted to oversee the functioning of auditors for Independence, the quality of audit and professional competence. This body should comprise a "majority of non- practicing accountants to ensure independent oversight. To avoid any bias, the chairman of this body should not have practiced as an accountant during the preceding five years. Auditors of all public companies must register with this body. It should enforce compliance with the laws by auditors and should mandate that auditors must maintain audit working papers for at least seven years.To ensure the materiality of information, the CEO and CFO of the company should certify annual and quarterly reports. They should certify that the information in the reports fairly presents the financial condition and results of operations of the company, and that all material facts have been disclosed. Further, CEOs and CFOs should certify that they have established internal controls to ensure that all information relating to the operations of the company is freely available to the auditors and the audit committee. They should also certify that they have evaluated the effectiveness of these controls within ninety days prior to the report. False certifications by the CEO and CFO should be subject to significant criminal penalties (fines and imprisonment, if willful and knowing). If a company is required to restate its reports due to material non-compliance with the laws, the CEO and CFO must face severe punishment including loss of job and forfeiting bonuses or equity-based compensation received during the twelve months following the filing.The problem with the independent directors has been that: I. Their selection has been based upon their compatibility with the company management II. There has been lack of proper training and development to improve their skill set III. Their independent views have often come in conflict with the views of company management. This has hindered the company’s decision-making process IV. Stringent standards for independent directors have been lacking....
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