LML4806
ASSIGNMENT 2 (SEMESTER 1)
DUE DATE: May 2025
Written Assignment Submission Guidelines:
Please ensure that your assignment is submitted electronically through the myUnisa platform no
later than March 2025. Kindly note that fax or email submissions will not be accepted.
NB: Assignment submitted to the lecturer(s) through email will not be considered.
QUESTION 1
Advise Mashudu on the following matters:
1.1 Whether there is any valid basis to remove Peter as a director of Star Engineering (Pty) Ltd. (3)
ANSWER:
Valid Basis for Removal
Mashudu has valid grounds to seek Peter’s removal as a director of Star Engineering (Pty) Ltd. In
terms of the Companies Act 71 of 2008, a director can be removed if they fail to fulfill their duties
and obligations to the company. One of the fundamental responsibilities of a director, particularly
an executive director responsible for financial matters, is to ensure the proper preparation and
submission of the company’s annual financial statements. Peter has failed in this regard for the past
two financial years, which is a serious dereliction of duty.
Furthermore, his failure to sign the previous financial year’s annual financial statements as the
authorised director may amount to misconduct or negligence, further strengthening the case for his
removal. Section 76 of the Companies Act requires directors to act with care, skill, and diligence,
and to fulfill their fiduciary duties in good faith and in the best interests of the company. Peter’s
ASSIGNMENT 2 (SEMESTER 1)
DUE DATE: May 2025
Written Assignment Submission Guidelines:
Please ensure that your assignment is submitted electronically through the myUnisa platform no
later than March 2025. Kindly note that fax or email submissions will not be accepted.
NB: Assignment submitted to the lecturer(s) through email will not be considered.
QUESTION 1
Advise Mashudu on the following matters:
1.1 Whether there is any valid basis to remove Peter as a director of Star Engineering (Pty) Ltd. (3)
ANSWER:
Valid Basis for Removal
Mashudu has valid grounds to seek Peter’s removal as a director of Star Engineering (Pty) Ltd. In
terms of the Companies Act 71 of 2008, a director can be removed if they fail to fulfill their duties
and obligations to the company. One of the fundamental responsibilities of a director, particularly
an executive director responsible for financial matters, is to ensure the proper preparation and
submission of the company’s annual financial statements. Peter has failed in this regard for the past
two financial years, which is a serious dereliction of duty.
Furthermore, his failure to sign the previous financial year’s annual financial statements as the
authorised director may amount to misconduct or negligence, further strengthening the case for his
removal. Section 76 of the Companies Act requires directors to act with care, skill, and diligence,
and to fulfill their fiduciary duties in good faith and in the best interests of the company. Peter’s
