A Hypothetical Case

[jw5]

This hypothetical case is for your comments, from experts, people with experience or anyone with interest.
I don't know the "right" answer, perhaps there is no right or wrong answer.

A and B are friends, they have no business dealings.
A is the sales director of a private limited company trading in canned food, B is a small business owner. A has no shares in his company
One day, A and B go to A's office. A gives B a can of canned abalone and tells him "It's on the house." B tells him that he can't take it and that he (B) does not even take anything from his company, even though he owns 100% of the shares.

In your opinion, is A right to give B the tin of canned abalone? Is he subject to any legal liability or action from his company?
Is B being too conservative or prudish not to take things from his own company, even though he owns it?

 

[balajii]

ask B to check properly.

i suspect that can of abalone to be either past its expiry date or is actually mock abalone

 

[po2wq]

ah 'a' can oso charge it under entertainment expenses ... do sales sure got sum gif n take 1 ...

ah 'b' can set his own rules, since iz his own coy ...

 

[kingrant]

Since A is not a sole proprietor nor has any shares in the company, but just an employee (I presume), what he has done is improper, even illegal. It amounts to theft and misappropriation of company's property. He should pay for the can of abalone.

 

[mustspeakup]

In your opinion, is A right to give B the tin of canned abalone? Is he subject to any legal liability or action from his company?
Is B being too conservative or prudish not to take things from his own company, even though he owns it?

always trusts your feelings, if you feel it's not right, it is probably true...

if i am B i will fire A for bribery..just imagine if he can do that to B, who else can A do that to?

many Singaporeans have this innate greed in us.....if nobody is around we just take....

that's very bad and will bring us lots of troubles....

 

[Wang Ye]

This hypothetical case is for your comments, from experts, people with experience or anyone with interest.
I don't know the "right" answer, perhaps there is no right or wrong answer.

A and B are friends, they have no business dealings.
A is the sales director of a private limited company trading in canned food, B is a small business owner. A has no shares in his company
One day, A and B go to A's office. A gives B a can of canned abalone and tells him "It's on the house." B tells him that he can't take it and that he (B) does not even take anything from his company, even though he owns 100% of the shares.

In your opinion, is A right to give B the tin of canned abalone? Is he subject to any legal liability or action from his company?
Is B being too conservative or prudish not to take things from his own company, even though he owns it?

Personally B is being a prick with regards to A. As a sales director I am certain it is within his right to give away samples. If it was not within his rights, then it is outright theft.

As to what B does in his company, it is just good practice with regards to accountability.

 

[balajii]

ooi. i never bring office stationeries home ok. swear.

 

[Ramseth]

First, must determine A's job remit in the company. What scope of powers does he have at his position. For example, some companies give managers and executives certain quota of free goods to give away at their discretion. Karaokes give managers and bouncers certain quota of free drinks to entertain guests at their discretion. Of course, discretion in this context means some benefits to business are expected, whether directly or indirectly, tangible or intangible.

 

[scoobyhoo]

1) Gift
if A buy the can of abalone from the company with money from his pocket,
and give to B as a personal gift, there's nothing wrong. (the company issues invoice to A, if the company is GST registered, and includes GST in the tax invoice)

2) Company Gift
if A want to sell something to B, and show his goodwill, he is giving B a company gift. then it is deemed as a supply, and need to collect GST, in this case, A should give an invoice to B (gift without commercial value, but with selling price and GST for GST declaration)

3) Sample
if A want to sell this abalone to B, and give to B as a sample, still need to collect GST, in this case, A should give an invoice to B (sample without commercial value, but with selling price and GST for GST declaration)

just my guess, don't know whether correct, please tell me.

 

[scroobal]

A can always claim that he handed over Abalone for promotional and marketing reasons. Its quite common especially if its small in value and he is in fact the sale director. To charge A for a crime, there must be a consistent pattern or the value must be considerable. This is because he is the sales director. If he was the company accountant or lawyer then the scenario changes into pilfering.

At the end of the day, the goods are assigned or he has been given access. Its up to the company to control the access. Most companies even small ones give their sales people a quota for samples to be distributed for promotional purposes. One cannot be a sales director if you have a mindset of security guard.

Most people will either take the sample or give an excuse for not taking it. They won't waste time thinking about it.

Bro, you need to wake up and stop figuring out how to entrap people that are wayward. Such people will eventually hang themselves.

This hypothetical case is for your comments, from experts, people with experience or anyone with interest.
I don't know the "right" answer, perhaps there is no right or wrong answer.

A and B are friends, they have no business dealings.
company, even though he owns it?

 

[jw5]

ask B to check properly.

i suspect that can of abalone to be either past its expiry date or is actually mock abalone

Ok, for argument's case, it's real abalone and it's not expired.
Your comments please.

 

[jw5]

ah 'a' can oso charge it under entertainment expenses ... do sales sure got sum gif n take 1 ...

ah 'b' can set his own rules, since iz his own coy ...

Your answer on B will be quite more common, but I'll comment on it later.
Your answer on A, I think, is not right. He should not charge to entertainment, since they have no business dealings.

 

[Ramseth]

He should not charge to entertainment, since they have no business dealings.

As a goodwill, looking forward to potential future business dealings, is usually also eligible under entertainment.

 

[jw5]

Since A is not a sole proprietor nor has any shares in the company, but just an employee (I presume), what he has done is improper, even illegal. It amounts to theft and misappropriation of company's property. He should pay for the can of abalone.

Thanks for your comments.
I agree with most of what you said, but whether any action will be taken will of course depend on whether he is found out and whether other people in the company (shareholders, directors or managers) want to deal with this. It will of course also depend on whether he has expressly been given the liberty of giving out free samples.

 

[jw5]

always trusts your feelings, if you feel it's not right, it is probably true...

if i am B i will fire A for bribery..just imagine if he can do that to B, who else can A do that to?

many Singaporeans have this innate greed in us.....if nobody is around we just take....

that's very bad and will bring us lots of troubles....

Sorry bro, I may have misled you unknowingly.
B is not the owner of the company that A works for. He is the owner of a totally different company which has no business dealings with A's company.

 

[jw5]

Personally B is being a prick with regards to A. As a sales director I am certain it is within his right to give away samples. If it was not within his rights, then it is outright theft.

As to what B does in his company, it is just good practice with regards to accountability.

Some people would argue that B is trying to help A. By accepting the can of abalone, he may be getting A into trouble.
A can only give free samples if he has been expressly given the right to. But don't forget that B has no business dealings with A or his company.

 

[jw5]

First, must determine A's job remit in the company. What scope of powers does he have at his position. For example, some companies give managers and executives certain quota of free goods to give away at their discretion. Karaokes give managers and bouncers certain quota of free drinks to entertain guests at their discretion. Of course, discretion in this context means some benefits to business are expected, whether directly or indirectly, tangible or intangible.

Good points.
You obviously have some experience or expertise in dealing with such issues.
Any comments about B, who claims that even as a 100% owner, he does not even take things from his own company?

 

[jw5]

Bro scoobyhoo,
thanks for your suggestion, but you seem to be re-writing the case.
I don't have a problem with that though, more comments are always more welcome than less.
I agree that what you said is what A SHOULD have done, but my case is based on what A did and how B responded and said.

 

[jw5]

A can always claim that he handed over Abalone for promotional and marketing reasons. Its quite common especially if its small in value and he is in fact the sale director. To charge A for a crime, there must be a consistent pattern or the value must be considerable. This is because he is the sales director. If he was the company accountant or lawyer then the scenario changes into pilfering.

At the end of the day, the goods are assigned or he has been given access. Its up to the company to control the access. Most companies even small ones give their sales people a quota for samples to be distributed for promotional purposes. One cannot be a sales director if you have a mindset of security guard.

Most people will either take the sample or give an excuse for not taking it. They won't waste time thinking about it.

Bro, you need to wake up and stop figuring out how to entrap people that are wayward. Such people will eventually hang themselves.

Bro, I am not trying to entrap anyone, in or out of this forum.
This case is purely hypothetical.
But what you said in the first para is incorrect. A and B have no business dealings at all. A cannot claim that he gave the product to B for promotional and marketing reasons, unless he has been expressly given the freedom to give out free samples.

 

[Ramseth]

Any comments about B, who claims that even as a 100% owner, he does not even take things from his own company?

If B owns 100% of his business, it's no longer a company. It's a sole proprietorship. In law and tax issues, he personally owns every asset and account to every liability. What he wants to take is up to him. Close down and fire sale or give away everything is also up to him.

It's just like a man saying, he has tens of thousands stashed away in a bank account separate from his daily usage bank account. He won't touch it as it's for rainy days and retirement. However, he decides when's raining and when's retirement. He still have full legal rights to touch it anytime even when it's not raining and he's not retiring.