The Difference Between a Board of Directors and a Board

question 16

Multiple Choice

The difference between a board of directors and a board of advisors is that: 

• A) the board of advisors meets less frequently.
• B) the board of directors lacks voting authority.
• C) the board of directors is subject to less pressure of litigation.
• D) the board of advisors are compensated.

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Definitions:

Minimum Cash Balance

The least amount of cash a company aims to hold in its accounts to meet immediate transaction demands.

Bank Requirement

Specific conditions imposed by a bank on a borrower or account holder, including minimum balances and fees.

Risk Assessment

The identification, evaluation, and prioritization of risks followed by coordinated efforts to minimize, monitor, and control the probability or impact of unfortunate events.

Internal Control

The processes and procedures implemented by a company to safeguard its assets, ensure accurate and reliable financial reporting, and promote compliance with laws and regulations.