You can't TOTALLY prevent anyone with Administrator privileges from gaining access to a network resource through either access permissions or Group Policy if he is determined.
First, the "owner/creator" of a file/folder can set permissions for that file/folder unless specifically denied those permissions. If you created the folder for your boss, you are the "owner/creator." By default, only Administrators can take ownership of a file/folder that doesn't already belong to them. You can give this right to other users, but you can't limit the scope of this right.
Second, by default, Administrators have the right to take ownership of any file/folder, even if they don't have the right to access it. Once ownership is established, access permissions can be reset. You could take away the right to "take ownership" from Administrators, but again there is no way to limit the scope of this action; it would be universal. But then again, there is nothing to stop an Administrator from re-enabling this right.
The bottom line is that the Administrator has far-reaching powers in the administration of a network. There isn?t any easy way to limit those powers without jeopardizing the administrators ability to do his job.
The only way to accomplish the company president?s goals is through encryption: either using EFS as included with Win2K, or some third party system such as PGP. You then run the risk of losing the files if someone loses the key.
Good luck.