Question 4 Qualified as a Hong Kong CPA, Jerry was an executive director of Win Ltd, a conglomerate listed in the HKSAR. Believing in the profit potential of the PRC electric vehicles manufacturing industry, Jerry caused Win Ltd to invest heavily in the shares of one of the PRC electric vehicles manufacturers for the first time. As soon as the investment was made and unexpected to the investment community generally, several countries announced the imposition of import tariffs on PRC electric vehicles, thus adversely affecting the profitability of the industry. Win Ltd suffered considerable losses in the said investment. (a). Describe the applicable standards of directors' duty when determining whether Jerry has fully discharged his duty in making the said decision as a director to cause Win Ltd to make the said investment. (b). Has Jerry breached any directors' duty if he honestly believed in the future of the PRC electric vehicles manufacturing industry? (c). Would there be any difference to your answer to Part (b) above if the reason why Jerry had caused Win Ltd to make the said investment was that Jerry had also invested in the shares of the said electric vehicles manufacturer himself? Explain whether Jerry has breached any directors' duties.

Question 4 Qualified as a Hong Kong CPA, Jerry was an executive director of Win Ltd, a conglomerate listed in the HKSAR. Believing in the profit potential of the PRC electric vehicles manufacturing industry, Jerry caused Win Ltd to invest heavily in the shares of one of the PRC electric vehicles manufacturers for the first time. As soon as the investment was made and unexpected to the investment community generally, several countries announced the imposition of import tariffs on PRC electric vehicles, thus adversely affecting the profitability of the industry. Win Ltd suffered considerable losses in the said investment. (a). Describe the applicable standards of directors' duty when determining whether Jerry has fully discharged his duty in making the said decision as a director to cause Win Ltd to make the said investment. (b). Has Jerry breached any directors' duty if he honestly believed in the future of the PRC electric vehicles manufacturing industry? (c). Would there be any difference to your answer to Part (b) above if the reason why Jerry had caused Win Ltd to make the said investment was that Jerry had also invested in the shares of the said electric vehicles manufacturer himself? Explain whether Jerry has breached any directors' duties.