Corporate Governance Issues and Evaluation: A Case Study of Thomas Cook

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TITLE OF THE PAPER CENTERED AND IN CAPS LOCK
by Student’s Name
Code + Course Name
Professor’s Name
University Name
City, State
Date
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Table of Contents
1. Analysis.......................................................................................................................................2
2. Evaluation of a corporate governance system.............................................................................4
3. Reflection.....................................................................................................................................5
References........................................................................................................................................7
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1. Analysis
Summary
Thomas Cook is a travel business that collapses because of customers increasing concerns
regarding traveling. City group declared that it was on a risk of a vicious cycle. Customer’s
wants might be unsettled after the tax loss reported by Thomas Cook. After the losses,
Thomas Cook was suffering from high debt and also has concerns regarding the demands of
traditional holiday packages. This debt is discouraging shareholders and investors were looking
to sell stakes of Thomas Cook to avoid losses by falling shares (Ateljevic and Page, 2017).
Government declared a fast track analysis and inquiry to find out the reason behind the collapse
which cost the closing of 178-year-old holiday business.
Potential concerns associated with this collapse includes exceptional item. A balance sheet of
company affected the results annually. It also results in decreasing profits. Two of the biggest
firms of accountancy used to handle audit for Thomas Cook. This tour operator experiences
multiple changes in financial chiefs for past two years. The secretary of business defended the
government's refusal to help the company out as it may cost a waste of money provided by
taxpayers (Shogren et al., 2017). It was also stated that the company was not provided with back
support as it’s not Corley based on UK. By government site those 2 hundred million dollars that
is demanded in not enough for the company to survive. The transport spokesperson said that he
does not recognise the proposed solution beneficial as it lacks details. It was reported that the
fallout of Thomas Cook is a result of weak governance theories. The provided articles reflect that
Thomas Cook can be saved at that instance if governmental aid is provided.
Corporate governance issues
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Title 4
Corporate governance is a high profile theme in the UK as government is taking interest in its
future development. Initiative and changes are driven at different levels to continue apace EU
referendum provided by advisory results in UK was found to favors organisations. Government
launched different industrial and energy strategy committees to inquire about corporate
governance with reference to public consultation (Bendickson et al., 2016). Different issues in
corporate governance are discussed in the provided articles along with their relevance with
corporate governance procedures practiced in Australia are discussed below.
All companies are required to explain the way through which the directors compel with the
existing requirements of companies. It is the duty associated with director that he must promote
company's success to benefit its members. While doing so all the necessary factors including
employees and stakeholders must be taken care of. Major similarity between corporate
governance issues in UK and corporate governance practices in Australia includes the disclosure
of arrangements made for corporate governance in the director's reports and websites (Panda and
Leepsa, 2017). These reports must follow a formal code. These requirements are necessary for
companies unless it is subjected to reporting requirements of corporate governance.
Government responds in case of Thomas Cook reflects the side-effects of poor
government policy but allows a 178 years old organisation to collapse rather than providing
financial aid. The code of corporate governance is published by FRC in UK. This published code
applies to the organisation having premium listing associated with equity shares in stock
exchange market in London (Chu et al., 2016). However, the corporate governance in Australia
is a bit different from that of the UK as it provides financial aids to the corporate who are facing
terrible problems in their businesses.
Agency theory
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