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UGANDA TECHNOLOGY AND MANAGEMENT UNIVERSITY

SCHOOL OF BUSINESS AND MANAGEMENT

PROGRAMME(S)

ASSESSMENT TEST 1, 2019

COURSE: CODE BA ETHICS AND COOPERATE GOVERNANCE

SECTION A
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1
A. Ethics can be described as principles of right conduct or a system of moral principles.
Corporate governance is the system of rules, practices, and processes by which and
organisation is directed and controlled. It involves balancing the interest the
orgaisation and other stakeholders example are shareholders, senior management
executives, customers, suppliers, financiers, the government, and the community.
Governance refers to the set of rules, controls, policies, and resolutions put in place
to dictate corporate behavior. According to Barret 2002 corporate governance shows
how an organisation is managed, other structures, its culture its policies and
strategies, and the ways in which it deals with its various stakeholders, Corporate
governance structures encompass the ownership structure, the composition of the
board of directors, the size of the board and the independence of the board among
others. This explains why corporate governance has in recent times, assumed global
significance as a crucial tool for sustainable corporate performance. Corruption is
almost becoming a way of life in Uganda and it has reached a stage that it is becoming
an issue on whom to trust and how to know who has not been infected with
corruption.
Corporate governance is important because it looks at how these decision makers act,
how they can or should be monitored, and how they can be held to account for their
decisions and actions. It also helps Set strategic plans and measure performance of
organisations

Example: UTAMU corporate governance collaboration by management, shareholders

and other stakeholders to reach the university goals

B. Challenges of corporate governance to most of the business public enterprises in

Uganda.
Corporate governance is the system of rules, practices, and processes by which and
organisation is directed and controlled.
Uganda suffered major setbacks in public sector management for several decades
especially in the 1970s and early 1980s. This was due to bad political leadership and
political instability but also due to lack of managerial skills, poor management
systems, corruption, nepotism and many other factors that affected public
organizations at the time. There was inefficient functioning of public entities and
inadequate service delivery. Corporate governance practices have become a
significant factor on the performance of Public entities. The widely held view that
corporate governance determines firm performance and protects the interests of
shareholders has led to increasing global attention this is according Bleakly, 2010
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In Uganda public service reforms have were undertaken taken to transform public
sector management, with the objective of addressing the challenges in management
systems, improving governance and service delivery.

a) Uganda government has failed to enforce laws, rules, and regulations

regarding corporate governance consistently and evenly which some time
mislead the stakeholders. Example are the Commercial banks, which
distinguished from other financial institutions by their accepting deposits and
provision of credit. Loans are the basic source of revenue and a major part of
asset for banks. However, poor management of credit has been a major cause
of bank failure.
b) Public offices lack the means to impose effective sanctions on their members
especially on the matters concerning conflict of interest which hinders the
corporation primary goal Managers who fail to implement desirable corporate
governance practices are not penalised but only transferred from one public
entity to another example is Irene Mulyagonja who was is now nominated to
sit on the Uganda Court of Appeal, on 4 October 2019. She was the Inspector
General of Government, from 12 April 2012. Until 4 October 2019 even after
the president said, many people had lost confidence in the office of the
Inspectorate of Government because its officers are compromised.
c) In Uganda, the capacity to support the implementation of good corporate
governance is undermined by the existence of weak monitoring and
enforcement. Government departments and independent regulators
responsible for monitoring corporate governance do not yet fulfill their roles
as overseers. Many are generally weak and subject to external influence by
politicians and lawmakers.
d) Majority of directors and board members have insufficient information
concerning desirable governance practice to enhance performance in these
public institutions and their poor performance is attributed to undesirable
governance practices. In other words, majority of ministers, Permanent
secretaries board members and directors are politically deployed without
proper assessment of their potential which has contributed to poor public
entities performance.
e) Lack of term limits for the board/ directors, Permanent secretaries creates
conflict of interest and personalisation of the public entities. Over stayed
boards with the directors, adversely affect the corporate governance practices,
which ultimately negatively affect the progress of an entity. Free and fair
board/ director’s reshuffle in public entity led to implementation of desirable
corporate practices, which improve the public entity’s performance.
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However argued Corporate Governance in Uganda can possibly be rectified

when Boards clearly understand their oversight monitoring role.

Better Salaries to enable the Boards to monitor the performance of company’s

executive management in order to enhance organizational performance
through desirable corporate governance practices.

Increased funds together with the proper accountability of the company

resources by the directors board does foster desirable governance practices
leading to improved company performance.

Public entity governing body should establish clear objective, goals and policy
to implement desirable corporate governance practice through regular
consultation of the public and service users on in order to ensure that the
services provided are contributing to the achievement of intended outcomes.
It should also ensure that the entity has processes in place to collect and
evaluate the views and experiences of people and organisations of all
backgrounds.

There should be consistent planning; creating independent boards,

commissions, or advisory groups is an effective way to improve the control
environment for governance practice through encouragement of citizen, user,
and/or volunteer to fully participate in governing of public sector entity.

In conclusion, Uganda needs good corporate governance for prosperity and

economic growth to occur. Uganda has the potential to promote good
corporate governance because the necessary mechanisms are in place.
However, at the heart of these mechanisms are several challenges such that
they outweigh the strengths. The government of Uganda should strengthen the
legal and regulatory systems with more emphasis on implementation and
enforcement to ensure proper auditing standards, regulated capital markets,
efficient boards of directors, shareholders’ protection

SECTION B

2 (a).
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Corporate governance is the system of rules, practices, and processes by which and
organisation is directed and controlled. It involves balancing the interest the
orgaisation and other stakeholders example are shareholders, senior management
executives, customers, suppliers, financiers, the government, and the community.

Audit involves the scrutiny of the accounts of an organisation by a qualified auditor,

in sufficient detail, to enable the auditor form an opinion on their truth and fairness.
Either it is this expression of opinion that provides the needed assurance that all is
well or the organisation is doing badly. Organisation have terms of reference terms,
which shows clearly the activities, and responsibilities of the audit committee. The
board of directors and its committees rely on the organisation management to run
the daily operations. The audit committee activities and responsibilities are to
oversee and monitor the organisation overall financial performance especially the
preparation of its financial statements balance sheet, income statement, statement of
stockholders and other duties include:
Oversee and monitor managerial financial reports such as cost and budgeting reports.

Oversee the effectiveness and efficiency of the organization internal control, and the
performance of both internal and external auditors.

Determine the scope do the internal auditor. The main responsibilities of the audit
committee is to enhance and maintain the internal auditors independence in order to
enable them to achieve their duties. The internal auditors provide the committee with
the necessary information to which they have direct access, same as the organisation
management, in order to enable the audit committee to accomplish their task of

a) Provide assurance by assessing and reporting on the effectiveness of governance,

management, and control processes designed to help the organisation achieve,
financial goals objectives.
b) Keep wider review of the effectiveness of company’s accounting and internal control
c) The audit has to ensure that the operations of the board of directors conform to
regulatory standards and established code for the industry of operation.
d) Effective audit committee will ensure that there is adequate check and balance on the
activities of the main board. Their presence serves, as effective control on the board
excess as the committee is expected to protect the interest of all.
e) Carry out an assessment of the overall effectiveness of the governance, control
frameworks of the organization, together with an analysis of threats and trends
emerging from internal audit work and their impact on the organization risk profile.
A report is then presented to the audit committee and the board with the results and
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recommendations as well as the challenges that may need board interventions to

handle.
To conclude audits role in governance is vital. Audit provides objective assurance and
insight on the effectiveness and efficiency of risk management, internal control, and
governance processes within the organisation.

B .Give the strategies you would employ a businessperson to maintain appropriate

compliance services delivery to your company.

A service delivery is a set of principles, standards, policies and constraints used to guide the
development, operation and retirement of services delivered by a service provider with a
view to offering a consistent service experience to a specific user community in a specific
business context.

Services are economic activities offered by one party to another

The strategies that would be employed to maintain service delivery conduct can go a
long way in improving a company success. In addition, they are discussed below
a. Product knowledge: Product knowledge is important because it will be difficult to
make a sale if I cannot show the customers or audience how the product I am
displaying will address their needs. This is likely to influence or persuade the
audience to buy the item.
b. Communication skills: Having communication skills is very important when dealing
with an audience or a customer. Some of these include speaking clearly and e
effectively. Communication skills are important because that is what going to decide
whether the customer will buy the product or not. Developing this skill will enable
me to deliver my presentation smoothly without stumbling or stuttering.
c. Skills Audit will enable me to identify my customer service strengths and weaknesses.
With a skill audit I will be able to know where to improve for example if I’m bad at
showing good body language, I will identify this weakness and I will take steps to
work on it. There are several benefits that come with a skill audit and these are:
A targeted and focused development plan that will enable me to turn my weaknesses
into strength.
Low development costs, as I will be more focused on the skills I will need to improve
rather than just wasting money on skills that I might already be good at.
d. Foster greater employee loyalty and retention. When employees feel included and
engaged in the company culture and success, they feel more committed.
e. Encourage greater customer loyalty and retention. When customers learn about and
then experience in practice a company’s high standards of conduct, customers are
more likely to show their appreciation.
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f. Build stronger relationships with suppliers and other business partners. As with
employees, the more that they understand what the company expects of them and
what they can expect from the company the stronger the cooperation
g. Adoption of modern technologies and continuous improvement.
h. Outsourcing services and partnering with other sectors
i. Accountability