Part (b) for 12 marks required a description of six weaknesses and recommendations faced by Serena VDW to ensure compliance with corporate governance. Candidates performed well on this question. Most candidates structured their answers in two columns to consider weaknesses and recommendations and this helped to generate a sufficient number of points.

The majority of candidates scored an overall pass on this requirement and they were able to easily identify the weaknesses within the scenario. However the requirement was to "describe" the weaknesses as opposed to "identify" and this was where some candidates failed to score as well as they could have. A common weakness given was "chairman and chief executive are the same person".

This does not describe how this could be a weakness to the company; the answer needed to expand into the potential abuse of power by allowing one person to perform both roles. Also some felt that by adding “this is not allowed under corporate governance rules" this would be sufficient as a description. Again this was not.

Candidates must pay close attention to the verb of the question requirement; if it is "describe" or "explain" then candidates must identify an issue and then provide detail as to how this is an issue for the entity in question.

With regards to the recommendations, many candidates had adequate corporate governance knowledge; however for some candidates it was the application of this knowledge that they struggled with. A common mistake was to suggest that "the auditors remuneration should be proposed by the remuneration committee"

In addition some recommendations were phrased as statements rather than as recommendations, such as, “corporate governance says that chairman and chief executive should be separate”. However, this does not explain what Serena VDW Co should now do to resolve this issue.