CIMAPRO19-CS3-1 Exam Dumps

Twelve hours have passed since you received the telephone call concerning the oil spillage.

You receive the following telephone call from William Seaton, Director of Finance:

''The press has got a hold of the story about the oil leak. Our share price has taken a major hit. Indeed, Slide's market capitalisation has fallen by a third since the stock exchange opened for business. There is a lot of loose talk in the press about the knock-on effect of this crisis for Slide. It has not escaped anybody's notice that there are news teams showing injured wildlife. There is also a great deal of footage being broadcast on the other sites around the world where we are revitalising oil wells using the same technology that was in use at AZ40.

Our experts have only just arrived at the spillage site. While they were on the corporate jet they emailed their initial thoughts, based on their understanding of what went wrong. Our engineers anticipate a major operation to block the leak by pumping cement into the bore hole at a low pressure. This will be expensive, but the cost will be less than one tenth of the reduction in our market capitalisation.

I need an email from you:

Firstly, I need a clear explanation of the key risks that Slide now faces because of this crisis. I am only interested in those with a high risk and high consequence and I need you to justify those classifications because the Board will need to prioritise its responses.

Secondly, two related issues: I need you to explain why Slide's share price has fallen to such an extent AND to recommend, with reasons, whether we should release our costings of the repair scheme at this time.

It goes without saying that I need this urgently.''

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Four weeks have passed since your encounter with the Chairman. The directors of both companies were informed of the proposal to merge two weeks ago and the public was informed two days ago.

You have received the following email from Marcus Svenson, Finance Director:

From: Marcus Svenson, Finance Director

To: Senior Finance Manager

Subject: Merger negotiations

Hi,

Please see the attached table and also a comment that I downloaded from a Wodd shareholder's blog, showing the market capitalisations for Wodd and Darrell both before and after the merger announcement.

If I am reading this correctly, it would appear that we are suffering at the hands of Darrell because the market believes that it is getting more of the benefit from the merger. This is before the terms of the merger have even been announced.

I need you to do two things:

Please draft a formal response to Market Blogger's post. We will insert this into his blog as a formal response from Wodd's Board and we will also email it to all shareholders.

Please draft an outline strategy for negotiating with Darrell's Board. Clearly, I want Wodd's shareholders to get the best possible deal out of this merger.

Marcus

Reference Material:

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Two weeks have passed since the article about Wodd's role in tax avoidance was published. Thankfully, the initial reaction was to condemn the celebrities who invest in tax avoidance and little was said about Wodd's role in facilitating tax-efficient investments.

You have received the following email from Sarah Johns, Marketing Director:

From: Sarah Johns, Marketing Director

To: Senior Finance Manager

Subject: Forestry certification

Hi,

I am told that you would be a good person to talk to concerning the practical implications of a new venture that has been proposed.

I have attached a sales brochure that I downloaded from Tabel's website. Tabel is a competing forestry company that has similar interests to our own. It has recently launched the certification scheme that it has described in its brochure. It has no competition for this certification in Marland because no other company has sought the qualifications required to offer an accredited Forest Certification Service.

Wodd has the necessary skills to offer a credible Forest Certification Service. Our forestry managers already aim to exceed all of the requirements set out by the global body. We also have a well-resourced internal audit department. I believe that we could transfer either forestry managers or internal auditors to a new external certification department. The transferred staff would complete the training required by the global body and would sit the associated examinations. We could then compete with Tabel's service.

I need your advice on the following:

Could you explain how you imagine that a typical certification investigation would work and the skills that it would require? That will help us to decide whether to approach forestry managers or internal auditors and will also enable us to describe the work that they would be doing if they agreed to be transferred.

What are the challenges associated with motivating and evaluating the investigators in the certification service and how might we address these?

Sarah

Reference Material:

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Daily Gazette

Celebrities flock to release tax returns

Comedian Madd Wilkins is the latest celebrity to post his tax returns online. The comedian earned M$1,600,000 from his sell-out tour and from the sale of DVDs. He paid tax of M$608,000 on that income. The comedian quipped, "there's nothing funny about paying tax, but then there's nothing very funny about my act either so it's only fair that I should pay the full whack".

Public concern about the tax benefits enjoyed by wealthy celebrities using artificial schemes such as investing in forestry to minimise their tax bills has led to closing tax loopholes topping the political agend

a. Many wealthy individuals have volunteered their tax files in order to reassure the public that they are not benefitting from such schemes.

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The Director of Finance, William Seaton, has invited you into his office.

''This will come as a bit of a shock, but the Board has decided that it would be in our best interests to relocate our Head Office from Kayland to the Middle East. We have interests there, including a regional office, already. We know that the oil industry is welcome and there are several governments which are very open to such foreign direct investment from the West.

Nothing has been decided for certain, but there are compelling tax advantages to us relocating. We would also be subject to slightly less restrictive legal requirements. We can retain our listing on the Kayland stock exchange, albeit as a foreign company.

Things are very much under consideration at the moment, so please don't tell anybody about this conversation.

I want to check that I have thought of everything at the strategic level before we make an irreversible decision to move. I need you to write me a report on the following:

What are the strategic implications of moving our Head Office from Europe to the Middle East?

What are the strategic risks that might arise and how might we deal with them?

I need to have your thoughts soon because the Board is holding a special meeting this afternoon.''

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