MNE3704 Assignment 2 (COMPLETE ANSWERS) Semester 2 2025 – DUE September 2025; 100% correct solutions and explanations.

MNE3704 Assignment 2 (COMPLETE ANSWERS) Semester 2 2025 – DUE September 2025; 100% correct solutions and explanations.UNIVERSITY EXAMINATIONS ASSIGNMENT 02 MNE3704 Family Business Management 50 Marks Examiners First : Ms MS Radebe Second : Mr W Sambo This assignment consists of five (5) pages. Instructions: (1) Submit your answers as a single document in PDF format. It is preferable for you to type your answers (Font: Arial 12) and then convert your document to PDF format for submission. However, if this is not possible, you may also write your answers down and scan them to a PDF file. Please write legibly. (2) Start with a cover page stating the module code (MNE3704) and your student number. (3) Make sure that each question is clearly numbered. (4) Please ensure that your PDF document is NOT encrypted to a “secured” mode and that it is NOT password protected as these files cannot be marked. Virus infected files will also not be marked. (5) Submit your answers in one PDF document by using the Assessment Info tool on myUnisa. (6) You need to answer the questions in your own words. Plagiarism will not be tolerated and may result in disciplinary action if detected. (7) Please include the following declaration at the end of your exam answer. I, …………………, with student number,………………… hereby declare that I have read the Unisa policy on plagiarism and the student disciplinary procedures documents, made available on the myUnisa module site, and I understand what constitutes plagiarism, collusion and academic fraud. I declare that this assignment is my own original work and that I have not allowed anyone else to borrow or copy my work. QUESTION 1 Read the following case study and answer the questions that follow: Case study: Five Sisters and Two Executors Stuart Campbell was a self-made Australian billionaire. Most of his wealth was tied up in one of the country’s largest mines, but he was also partial owner of a film production company in the UK, a tech start-up in Silicon Valley, and a number of smaller companies around the world. Stuart was not much for governance, organization structure, or formal systems. Stuart was married and had five daughters. The first two, in their late 30s, had worked in their father’s businesses in administrative roles and had left the firm when they got married and had children. The other three daughters were all single. The third daughter was a successful op-ed writer on political issues who published under a pseudonym in order to protect the family name, and the two youngest were finishing college. Stuart’s two oldest daughters and their families lived separately but the Campbell clan met regularly and enjoyed being together on holidays. Everything changed when Stuart died suddenly in a car accident in 2013. Stuart had left a simple irrevocable trust, with only one directive: his estate was to be divided equally among his five daughters, who were to work out an Australian Shareholders Agreement (ASA) in order to access their inheritance. Six months before Stuart died, he had held the family’s first succession planning meeting. It did not lead to any results or actions. Stuart had left no plan for transition or succession, and the beneficiaries found themselves unprepared to take over Stuart’s huge mining business and other investments around the world. The five sisters spanned a range of life stages, interests, ambitions, experience, and knowledge of the business. They had a very tough time in the first couple of years, a period they described as “super stressful and very emotional” because of both external pressures and internal challenges. The Two Executors Stuart had appointed two outside executors for his estate. The two told the sisters that Stuart had asked them to help his five daughters “run his businesses after he died because they didn’t know how to run a business or speak the language of business.” The five sisters, the sole beneficiaries of Stuart’s vast wealth, felt they had no control over their father’s estate. They couldn’t make any decision without the executors’ approval, nor could they remove the executors because they had no power to do so. Their mother was of no help because she told them they needed to listen to the executors if the business was going to survive. The sisters felt that the two executors had created lifetime jobs for themselves: they were paying themselves large salaries and had entrenched themselves in their positions. It didn’t look like they had plans to leave any time soon. The five sisters knew they didn’t have the tools, knowledge, or experience to manage the businesses on their own, so they hired experts and advisors to help them develop governance structures, leadership skills, and strategy for the family. They decided that they would become the only directors of the board of the family’s business empire and appointed the oldest as CEO and the next oldest as COO. They worked out an agreement with the executors and paid them a substantial amount of money to leave. Stuart’s businesses were registered in a variety of countries and Australian provinces, which created considerable tax and reporting complications, as well as uncertainty about which sister from which province was eligible to be a Director in what business. In addition, they needed to determine what to do with multiple unrelated investments that didn’t necessarily fit together. A significant internal challenge was that Stuart had created a bloated and top-heavy staff – a result of his unwillingness to fire anyone. He had long-serving senior employees with big titles but little to do. These people needed to be retired or removed but they pushed back, claiming that Stuart had promised them lifetime employment. When some of these people were eventually terminated, they filed “unfair dismissal” lawsuits, some of which were complex and demanded large settlements. It took four years for the five sisters to finalize an Australian Shareholder Agreement (ASA) with the help of a process consultant who had earned their trust. Each sister had an equal share in the joint estate and an equal vote on the five-person board governing all the family’s businesses. Source: Questions: 1.1 In the light of the above case study, discuss the pitfalls that family business owners should avoid. Provide excerpts from the case study to support your theory. (8) 5 1.2 Provide three (3) reasons why family business owners often delay estate planning. Support your answer with examples from the case study. (3) 1.3 What topics are covered in the estate planning? Was this