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Please go through the attached assignment questionnaire and the articles, and answer the questions.

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10/8/2019
Thomas Cook directors could face inquiry as rescue effort continues | Business | The Guardian
Thomas Cook directors could face inquiry as rescue effort
continues
Travel firm’s auditors also in spotlight with thousands of staff facing uncertain future
Gwyn Topham, Sean Farrell and Simon Goodley
Wed 25 Sep 2019 03.08 AEST
Regulators and MPs were considering investigations into Thomas Cook’s auditors and directors as the fallout
from the travel firm’s collapse continued on Tuesday, with thousands of staff and suppliers facing uncertain
futures and more than 100,000 holidaymakers still due to be brought home on government rescue flights.
Britain’s accountancy regulator, the Financial Reporting Council (FRC), said it was considering the case for
investigation and enforcement action “as a matter of urgency”, while MPs on the business select committee
said there were “serious questions to answer” about how the firm was run.
The government has already announced a fast-track inquiry into the collapse by the Insolvency Service, which
is charged with closing down the 178-year-old holiday business.
Potential concerns for the FRC include the extent of “exceptional items” on the company’s balance sheet, which
could have swayed investors and affected annual results – as well as the profit-related bonuses paid to directors.
Thomas Cook was audited by two of the UK’s biggest accountancy firms, with EY succeeding PwC from 2017.
The tour operator had a series of finance chiefs over the past two years.
The pay of the last three chief executives of Thomas Cook has come under increased scrutiny.
Labour’s John McDonnell has urged the former bosses to repay their bonuses while the Confederation of British
Industry said “questions are now rightly being asked” about the £35m paid out over the past 12 years to Manny
Fontenla-Novoa, Harriet Green and Peter Fankhauser.
https://www.theguardian.com/business/2019/sep/24/thomas-cook-directors-could-face-inquiry-as-rescue-effort-continues
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10/8/2019
Thomas Cook directors could face inquiry as rescue effort continues | Business | The Guardian
The business secretary, Andrea Leadsom, defended the government’s refusal to help bail out the company,
insisting that it would have been “a waste of taxpayers’ money”.
She would not comment on claims that the UK had refused to back a financial lifeline tabled by Spanish
hoteliers and the Turkish government.
She said only that there were “all sorts of rumours” but insisted that £200m was an underestimate of what the
company needed to survive.
A Department for Transport spokesperson later said: “We do not recognise the details of this proposed solution.
At no point was a deal presented.”
Thomas Cook had pinned its survival hopes on a restructuring that would have wiped out £1.7bn of existing
debts and injected an extra £900m, half from the Chinese tourism business Fosun. The Chinese company would
have taken control of the firm. Demands from banks for an extra £200m pushed the firm over the edge.
The business select committee said it wanted answers about the collapse. Its chair, Rachel Reeves MP, said:
“There are serious questions to answer, including about the company’s accounting practices, its remuneration
policy and practice, and about the stewardship of the company.”
Leadsom asked banks and credit card firms to give consideration to redundant Thomas Cook staff who may
struggle with bills while awaiting redundancy payments.
About 645 of them are now working for the Insolvency Service at the defunct group’s Peterborough
headquarters, assisting with Operation Matterhorn, the temporary airline set up by the Civil Aviation Authority
(CAA) to bring home stranded holidaymakers.
The CAA was due to bring 16,800 Thomas Cook customers back to the UK on Tuesday on 74 rescue flights. It
repatriated 14,700 passengers on Monday, about 95% of whom had been due to fly that day.
Many flights have been combined, with passengers flown in on larger jets and then taken to their destinations
by bus. A Malaysian Airlines A380 superjumbo was flying between Mallorca and Manchester, carrying
passengers also due to travel to Birmingham, Gatwick and Newcastle.
Some holidaymakers reported continued confusion, including demands for payment from hoteliers fearful of
not being paid, despite the CAA’s guarantees to pay for rooms under the Atol protection scheme.
Customers who had booked with Thomas Cook but are yet to travel will get full refunds, but the prices of
alternative trips will probably be much higher.
Many flight and holiday prices have soared, prompting outrage on social media at BA, Jet2, Ryanair and Virgin
among others. The cheapest direct return flights to destinations such as Crete and Tenerife are now almost
£600 for a range of dates in October.
More people in Australia…
… like you, are reading and supporting The Guardian’s independent, investigative journalism than ever before.
And unlike many new organisations, we have chosen an approach that allows us to keep our journalism
accessible to all, regardless of where they live or what they can afford. But we need your ongoing support to
keep working as we do.
The Guardian will engage with the most critical issues of our time – from the escalating climate catastrophe to
widespread inequality to the influence of big tech on our lives. At a time when factual information is a
necessity, we believe that each of us, around the world, deserves access to accurate reporting with integrity at
its heart.
Our editorial independence means we set our own agenda and voice our own opinions. Guardian journalism is
free from commercial and political bias and not influenced by billionaire owners or shareholders. This means
we can give a voice to those less heard, explore where others turn away, and rigorously challenge those in
power.
We need your support to keep delivering quality journalism, to maintain our openness and to protect our
precious independence. Every reader contribution, big or small, is so valuable. Support The Guardian from as
little as $1 – and it only takes a minute. Thank you.
https://www.theguardian.com/business/2019/sep/24/thomas-cook-directors-could-face-inquiry-as-rescue-effort-continues
2/3
10/8/2019
MPs announce inquiry into Thomas Cook collapse | Business | The Guardian
MPs announce inquiry into Thomas Cook collapse
Investigation to focus on issues including executive pay, accounting and role of auditors
Rob Davies
Fri 27 Sep 2019 03.17 AEST
MPs are to hold an inquiry into the role of “corporate greed” in the collapse of Thomas Cook, focusing on
directors’ stewardship of the company, how much they were paid and how its accounts were prepared and
signed off by auditors.
As the business, energy and industrial strategy committee announced the wide-ranging inquiry, the business
secretary, Andrea Leadsom, set up a taskforce to help those affected by the corporate failure, but has been
accused of “shutting the stable door after the horse has bolted”.
MPs announced the investigation four days after the high-profile demise of the world’s oldest tour operator,
which forced an ongoing, taxpayer-funded repatriation of 150,000 UK holidaymakers and put 9,000 British jobs
at risk. News of the inquiry came as the government revealed that the cost of reimbursing holidaymakers who
have lost bookings is £420m, on top of the £100m cost of the Thomas Cook airlift.
The BEIS committee chair, Rachel Reeves, has also written to Leadsom to raise concerns about the slow
progress of audit reform. The audit profession has come under pressure in recent years after a string of highprofile collapses, including Patisserie Valerie and Carillion, both of which were investigated by the BEIS
committee.
Britain’s accountancy regulator is also considering whether to investigate the demise of Thomas Cook, which
was audited by EY.
The BEIS committee’s hearings are expected to start in mid-October, with former directors, auditors, the
accounting regulator and the insolvency service expected to give evidence.
https://www.theguardian.com/business/2019/sep/26/mps-announce-inquiry-thomas-cook-collapse
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10/8/2019
MPs announce inquiry into Thomas Cook collapse | Business | The Guardian
Reeves said: “The collapse of Thomas Cook has uncovered what appears to be a sorry tale of corporate greed,
raising serious questions about the actions of Thomas Cook’s bosses and their stewardship of the business.
“This latest corporate failure has shone a light once again on the use of aggressive accounting methods to aid
bumper payouts to company executives and the apparent inability of auditors and regulators to curb these
practices in the wider interests of shareholders, investors and the public.
“The BEIS committee has a longstanding interest in corporate governance, executive pay and audit reform,
which we are keen to follow up in this inquiry. The main players in the sad demise of Britain’s oldest travel firm
should face public scrutiny and be held to account for their actions before the company collapsed.”
Current and former Thomas Cook executives have been criticised in recent days after it emerged that its last
three chief executives had taken home pay packages worth a combined £35m over the past 12 years.
The transport secretary, Grant Shapps, who faced ridicule for plagiarising his predecessor Chris Grayling’s
statement on the collapsed airline Monarch, indicated this week that Thomas Cook executives could have some
of their bonuses seized. However, the £4.6m bonus awarded to the most recent chief executive, Peter
Fankhauser, was paid mostly in shares that are understood not to have been sold and are now worthless.
Leadsom has asked the insolvency service, which is overseeing the liquidation of Thomas Cook, to investigate
the role of directors in its collapse. She also hosted a roundtable meeting on Thursday with trade unions and
officials to look into ways to support staff and communities affected by one of the largest corporate failures in
UK history.
Speaking after the meeting, one trade union official described Leadsom’s taskforce as “like shutting the stable
door after the horse has bolted”.
Manuel Cortes, the general secretary of the transport workers’ union TSSA, said ministers should be hauled
before the BEIS committee’s inquiry to explain why the government was not prepared to invest in Thomas
Cook, given the determination of its biggest shareholder – the Chinese conglomerate Fosun – to continue
putting money into the business.
He said: “For example, why would a private company like Fosun be prepared to put £450m into a company
which had no future? I have had no reasonable response from ministers on this point.
“I’m calling on the committee to bring ministers before them so we can get answers as to why, as has been
widely reported, the Turkish and Spanish governments were prepared to make substantial investments to
support Thomas Cook but the British government refused to allow that to happen.”
Referring to the German government’s offer to rescue Thomas Cook’s Frankfurt-based airline with a bridging
loan, he added: “Of course, most recently the German government provided €350m to save Thomas Cook’s
subsidiary Condor as our government simply sat on its hands.”
More people in Australia…
… like you, are reading and supporting The Guardian’s independent, investigative journalism than ever before.
And unlike many new organisations, we have chosen an approach that allows us to keep our journalism
accessible to all, regardless of where they live or what they can afford. But we need your ongoing support to
keep working as we do.
The Guardian will engage with the most critical issues of our time – from the escalating climate catastrophe to
widespread inequality to the influence of big tech on our lives. At a time when factual information is a
necessity, we believe that each of us, around the world, deserves access to accurate reporting with integrity at
its heart.
Our editorial independence means we set our own agenda and voice our own opinions. Guardian journalism is
free from commercial and political bias and not influenced by billionaire owners or shareholders. This means
we can give a voice to those less heard, explore where others turn away, and rigorously challenge those in
power.
We need your support to keep delivering quality journalism, to maintain our openness and to protect our
precious independence. Every reader contribution, big or small, is so valuable. Support The Guardian from as
little as $1 – and it only takes a minute. Thank you.
https://www.theguardian.com/business/2019/sep/26/mps-announce-inquiry-thomas-cook-collapse
2/3
Technology
Thomas Cook’’s New Turkish Investor Wants Role in
Turnaround Plan
By Asli Kandemir, Luca Casiraghi, and Richard Weiss
August 7, 2019, 10:36 PM GMT+10
Updated on August 8, 2019, 12:13 AM GMT+10
Veteran U.K. tour operator can still thrive, Neset Kockar says
Proposed Fosun bailout is excessive, according to entrepreneur
Neset Kockar Photographer: Nikita Shvetsov/Anadolu Agency via Getty Images
Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.
Thomas Cook Group Plc investor Neset Kockar is demanding a role in rescuing the troubled U.K. travel giant
after the Turkish tourism entrepreneur’s purchase of a stake last week led the stock to triple in value.
Cook could be a success with the right strate y and management approach, Kockar told Bloomberg News,
adding that a planned 750 million-pound ($911 million) financing package from Chinese shareholder Fosun and
banks probably over-estimates the scale of challenges facing the world’s oldest holiday firm.
“Fosun may be assessing the company through the lens of a financial investor,” said Kockar, whose Anex Tour
has $2.4 billion in annual sales. “I think the problems can be overcome by injecting less cash than the
announced recap plan. I see managerial problems rather than simply financial issues.”
Kockar, 46, said he’s devising a long-term business plan for Thomas Cook and has been in touch with
investment banks working with it and Fosun. He hasn’t been in direct contact with executives at the U.K.
company, which he described as his “inspiration.”
The comments indicate a potential clash over how to revive Thomas Cook as the 178-year-old firm grapples
with a long-term decline in the popularity of package holidays in Europe that has stoked debt and shrunk
margins. The London-based company’s market value fell as low as 69 million pounds last month, allowing
Kockar to buy an 8% holding for about 10 million pounds.
“My aim is not to make profit by trading Thomas Cook shares,” he said in a phone interview in the resort city of
Antalya, where Anex is based. “Everyone sees it as a broken machine, but I believe that if the right steps are
taken it’s a great machine which will work very efficiently again.”
Fosun, which has an 18% stake in Cook, sent the stock tumbling on July 12 with the announcement of a rescue
that would heavily dilute shareholder ownership. Kockar said he took that as evidence that a financial bailout
alone won’t save the company and that it requires fresh strategic thinking. The shares jumped Wednesday after
reporting Lilia Rodionova, based in Ulianovsk, Russia, owns 3.46% of voting rights. No further information was
immediately available. The stock was trading down 3.8% at 9.50 pence at 3:11 p.m. in London.
“When I invested, the reaction of the share price also proved that there were like-minded investors who have
made the same diagnosis,” Kockar said, adding that “many interested parties” have approached him about his
plans. Thomas Cook declined to comment on the remarks and Fosun didn’t immediately respond to requests
for comment outside office hours.
Even with the rally after Kockar’s investment, Cook has lost 94% of its value since its most recent peak in May
2018, when it had a market capitalization of 2.2 billion pounds.
Cook has already arranged a 300 million-pound emergency loan that Fosun has committed to refinance. Under
the proposal, whose details are being agreed with banks and bondholders, Fosun will take control of the tour
operator arm, while creditors will swap most of their holdings for the majority of an airline unit that Chief
Executive Officer Peter Fankhauser has been struggling to sell. The recapitalization will mean a significant
dilution of Kockar’s own holding.
Read More: Package Tours Are No Picnic. That’s Not Stopping Germany’s TUI
Cook should remain a single entity, said the former tourism student, who went from working in hotels to acting
as a Turkish go-between for Russian tour operators and then opened his own office in Moscow. That would
mean retaining airline operations including Germany’s Condor, according to Kockar, whose own German
carrier failed in 2018 amid a European price war.
He also dangled the prospect of cooperation between the U.K. company and Anex Tour, which specializes in
supplying holidays in Turkey to tourists from Russia, Eastern Europe and Germany to create a more costeffective business.
Plans for Anex envisage tapping markets further west, and the company is expanding into hotels and cruising,
much like TUI AG, Cook’s biggest rival, has done on a larger scale. The company is buying a ship from Saga Plc,
has four hotels in E ypt, and is investing in properties in Vietnam and the Dominican Republic, Kockar said,
with growth in Turkey remaining steady.
“I can contribute capital, mutual synergies and operational know how,” the entrepreneur said. “I have my own
sources of finance and action plans, and I would like to discuss these. I have a very friendly and constructive
approach.”
Read More: Thomas Cook Swings Make It U.K.’s Most Volatile of Past Month
— With assistance by Shirley Zhao
(Adds detail about Russian investor in seventh paragraph.)
In this article
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fastFT Thomas Cook Group PLC
Thomas Cook risks collapse as stock dives
Shareholders braced for wipeout as fears mount over summer travel bookings
Shares in Thomas Cook tumbled 39 per cent on Friday © Getty
Daniel Thomas, Alice Hancock and Myles McCormick in London MAY 17 2019
Thomas Cook shares were branded worthless on Friday, triggering a collapse in the value of the
UK’s oldest travel business and raising concerns among customers travelling this summer to its
holiday resorts around the world.
Shares in the 178-year-old group fell almost 40 per cent on Friday after Citigroup said it was at risk
of a “vicious” cycle. It warned that customers could be unsettled after Thomas Cook reported a pretax loss of £1.5bn this week and revealed its auditor had noted material uncertainties over the
successful sale of the group’s airline business and a new credit facility.
Thomas Cook, which is suffering under high debts and concerns over demand for traditional
package holidays amid Brexit uncertainty, has raced to shore up its balance sheet.
But the FT has learnt that US hedge funds have taken stakes in the company’s bonds as well as its
revolving credit facility, positioning themselves for a potential restructuring of the company’s debt
that would wipe out shareholders in the business and leave debt holders in control.
Investors including Anchorage, TT International and
It is only two years ago that
this business was making
£250m of profit and I do
think it is capable of getting
back to those kind of levels
Whitebox have emerged as among the biggest short
sellers of Thomas Cook stock — in effect benefiting

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