ACC2006/ACC204 Company Law: Individual Reflective Journal on Topics

This reflective journal covers key topics in Company Law (ACC2006/ACC204) over nine weeks. It includes discussions on alternative business structures like sole traders, partnerships, and companies, as well as the process of incorporation and the importance of a company constitution. The journal also delves into the roles and responsibilities of promoters, corporate liability, and the powers of company members, including their rights to dividends. Further topics include corporate governance, the duties of directors and officers, and methods of financing a company through equity and debt. Finally, it addresses the remedies available to members when directors' actions are deemed unjust, referencing relevant newspaper articles and contemporary issues to support the learning process.

Running head: ACCOUNTING
Accounting
Name of the Student
Name of the University
Author Note

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Table of Contents
Week 1- Alternative Business Structures...................................................................................2
Week 2- Companies and Incorporation......................................................................................2
Week 3- Company Constitution.................................................................................................2
Week 4- Promoters , Outsiders dealing with Companies and Corporate Liability....................3
Week 5- membership, members powers and dividends.............................................................3
Week 6-Corporate Governance and Company Management.....................................................4
Week 7- Introduction to directors and Officers Duties..............................................................4
Week 8- Financing a company via equity/debt, share capital transactions................................5
Week 9-Members remedies........................................................................................................5
References..................................................................................................................................6

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Week 1- Alternative Business Structures
The topic this week is that of alternative business structure. In relation to the company
form of business, I have learned that there are alternative business structures as well. These
include that of sole traders, partnerships, trust and associations.
The article titled” Dream of being your own boss? Join the sole traders” is relevant to
this week’s lecture. This article talks about the sole trader form of business. It talks about
how sole traders have the freedom to run their own business and manage a better work-life
balance. It also has its fair share of difficulties as well, like being personally liable for any
losses (Smith 2018).
Week 2- Companies and Incorporation
The topic that has been discussed in this week is companies and incorporation. This
week I have learned that every company needs to be formally incorporated to start its
business. An incorporated business offers many benefits like limited liability, permanent
existence and transferability of shares.
The article “ Afterpay and the US: a match made in heaven, or a potential disaster? Is
relevant to this week’s lecture. It is a company that enables retailers to offer customers the
chance to buy now and pay later without requiring any upfront payment. It is a company that
has made a phenomenal rise. Its partnership with America will take it to the next level. It is a
company that has gained praise for its innovative working practices (McDuling 2018).

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Week 3- Company Constitution
Every company that is set up after July 1998 has to follow he company laws and
regulations. These rules will help the company in governing the management of the company
in respect of its employees, financial recording maintenance and maintain transparency.
The article relevant for this week’s lecture is titled ”Shareholders want power to
escalate issues” . In this article ,the Australian Council of Superannuation Investors voices
their opinion regarding the “ shareholder resolutions” system and restricts the rights of
shareholders. They need to have greater powers in ensuring that their concerns are being
heard at company annual meetings (Williams 2018).
Week 4- Promoters , Outsiders dealing with Companies and Corporate Liability
This week’s lecture discusses the issue of promoters and how outsiders deal with
companies. This discussion has helped me understand about the value of outsiders and how
their actions can influence the operations and restructuring of the company as well.
The article relevant for this week is “ I like it”: Billionaire Bruce Gordon speaks out
on Nine –Fairfax deal . In this article the merger between Nine Entertainment and Fairfax
Media has been stated. This merger would help strengthen both companies and create one of
Australia’s largest media organisations. This deal would combine the free to air network of
Nine with the newspaper mastheads of Fairfax, thereby bringing in more revenue for both
(McDuling 2018) .
Week 5- membership, members powers and dividends
This week’s lecture draws upon the discussion of membership and its powers. The
members of a company include the shareholders of a company. The shareholder enjoys

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powers like transfer of shares, right to attend meetings and most important of all, receipt of
dividend.
The article relevant for this week is “ Rio Tinto announces $ 7bn cash return bonanza
“. In this article the shareholders of the company are expected to receive a windfall profit of $
7 bn through dividends and share buybacks. It also plans to pay an all time high interim
dividend of $ 2.2 billion. After having spent millions of dollars on new acquisitions and
expansion of projects , the company has finally met the expectations of shareholders (Ft.com.
2018).
Week 6-Corporate Governance and Company Management
With the rise of big multinationals and corporations, it is very difficult to manage big
companies. There is a lot of responsibility that rests with the directors of the company. He is
in charge of the daily operations of the business and is responsible for decision making.
The recent article on” Are banks too big for boards to govern “ caught my attention
regarding this week’s lecture. The banks recently in Australia have been embroiled in big
scandals . This is mainly due to the poor governing practices of the bank. The traditional
ways have been proved to be ineffective( Featherstone 2018).
Week 7- Introduction to directors and Officers Duties
In this week’s lecture the discussion touched aspects of the importance of directors in
an organisation. The directors have the most important role in achieving the objectives of the
company. The company can achieve its objectives if the directors and officers of the
company perform their duties diligently. They must act in the best interest of the company.

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The article relevant for this topic is “ Centro case tests duty of directors” . This article
illustrates the failure of the directors of Centro in discharging its duties. They overlooked the
company’s liabilities and short term debt figures. This resulted in a massive loss of investor’s
confidence , with the company struggled to refinance its loans. The directors were simply
negligent in performing their duties in this case (Wood 2018). .
Week 8- Financing a company via equity/debt, share capital transactions
In this week’s lecture, I have learnt that a company can finance its operations from
two sources-equity and debt. Debt financing is an option whereby the company can acquire
funds by getting loans and paying interest. equity financing is about financing company
through buying shares. Shares are being issued to raise capital from investors.
The article relevant for this week’s lecture is “ financing a business without bank
loans”. This article discusses the various financial options available to a business in addition
to a bank loan. When the bank is unwilling to lend without collateral, there are a number of
options that are available in addition to the bank loan. These include factoring, private
equipment, crowd funding and capital raising (Niesche 2018).
Week 9-Members remedies
Members have an important role in making investments to the company. We have
already learnt about the rules and regulations of shareholders. In this week, the topic discuses
about the remedies that a shareholder can address in case the actions of a director seem
inappropriate and unjust.
The article relevant for this week’s lecture is “ Surprising, disappointing – AMP
largest shareholder breaks silence”. This article talks about how David Herro’s Harris
Associates commented about the whole financial fiasco of the AMP bank. The scandal

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revealed evidence of misleading and malpractices of AMP including misleading customers
and regulators. He pushed for the resignation of the three directors that were conceded to
have the most responsibility in the scandal (Knight 2018). .

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References:
Featherstone, T. 2018. Are banks too big for boards to govern?. [online] The Sydney
Morning Herald. Available at: https://www.smh.com.au/business/small-business/are-banks-
too-big-for-boards-to-govern-20180501-p4zcqs.html [Accessed 2 Sep. 2018].
Ft.com. 2018. Rio Tinto announces $7bn cash return bonanza | Financial Times. [online]
Available at: https://www.ft.com/content/1534a99c-9555-11e8-b747-fb1e803ee64e
[Accessed 3 Sep. 2018].
Knight, E. 2018 'Surprising, disappointing' - AMP's largest shareholder breaks silence.
[online] The Sydney Morning Herald. Available at:
https://www.smh.com.au/business/banking-and-finance/surprising-disappointing-amp-s-
largest-shareholder-breaks-silence-20180502-p4zcxr.html [Accessed 2 Sep. 2018].
McDuling, J. 2018. Afterpay and the US: a match made in heaven, or a potential disaster?.
[online] The Sydney Morning Herald. Available at:
https://www.smh.com.au/business/companies/afterpay-and-the-us-a-match-made-in-heaven-
or-a-potential-disaster-20180902-p5018x.html [Accessed 2 Sep. 2018].
McDuling, J. 2018. 'I like it': Billionaire Bruce Gordon speaks out on Nine-Fairfax deal.
[online] The Sydney Morning Herald. Available at:
https://www.smh.com.au/business/companies/i-like-it-billionaire-bruce-gordon-speaks-out-
on-nine-fairfax-deal-20180801-p4zut2.html [Accessed 2 Sep. 2018].
Niesche, C. 2018 Financing a business without bank loans. [online] The Sydney Morning
Herald. Available at: https://www.smh.com.au/business/financing-a-business-without-bank-
loans-20121005-273jg.html [Accessed 2 Sep. 2018].

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Smith, M. 2018. Dream of being your own boss? Join the sole traders. [online] the Guardian.
Available at: https://www.theguardian.com/small-business-network/2016/jan/25/being-own-
boss-sole-traders-business [Accessed 2 Sep. 2018].
Williams, R. 2018. Shareholders want power to 'escalate' issues. [online] The Sydney
Morning Herald. Available at: https://www.smh.com.au/business/shareholders-want-power-
to-escalate-issues-20171026-gz8nnl.html [Accessed 2 Sep. 2018].
Wood, L. 2018. Centro case tests duty of directors. [online] The Sydney Morning Herald.
Available at: https://www.smh.com.au/business/centro-case-tests-duty-of-directors-
20110425-1du3n.html [Accessed 2 Sep. 2018].