Which of the following statements about advisory boards is incorrect?
A) The fact that a corporation has a board of directors does not preclude it from establishing one or more advisory boards.
B) An advisory board can be established for general purposes or can be set up to address a specific issue or need.
C) Similar to a board of directors, an advisory board has legal responsibility for the firm in certain areas.
D) An advisory board is a panel of experts who are asked by a firm's managers to provide counsel and advice on an ongoing basis.
E) A growing number of startups are forming advisory boards.

Question

Quizplus · Accepted Answer

An advisory board does not have legal responsibility for the firm. The purpose of an advisory board is to provide counsel and advice to the firm's managers, but it does not have the same legal obligations and responsibilities as a board of directors.

Which of the Following Statements About Advisory Boards Is Incorrect