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1. Which of the following types of resolution does not generally have to be filed at Companies House? Ordinary. b. c. d. Special. Elective. Extraordinary.

2. In a situation where the memorandum and the articles contradict The articles prevail The memorandum prevails a. b. c. d. Only (i) is true Only (ii) is true Both (i) and (ii) are false Neither (i) or (ii)

3) What is the percentage of majority needed to pass an extraordinary resolution? a. 100% b. 51% c. 75% d. 62% 4 GHI Ltd has contracted with JKL Ltd. If JKL Ltd acts in breach of a condition, which of the following is correct? GHI Ltd may terminate the contract and sue for damages. GHI Ltd may terminate the contact but cannot also claim damages. GHI Ltd is entitled to damages only. The contract between GHI Ltd and JKL Ltd is automatically terminated. If a business is registered under the name Siddiq Ltd what kind of ownership does it have? a. b. c. d. Private Limited Company Public Limited Company Sole Ownership Partnership

a. b. c. d.

5)

6) Ahmed is demanding a reference from his employer Surendra which of the following statements about employers giving reference is correct? a. Should give reference to those who have worked more than one year b. An employer has a duty to provide reference c. An employer has no duty to provide reference d. An employer has a duty to provide full and comprehensive reference 7) Zacky, Ehsaan, Fasil and Ruwan are the shareholders of a company. Zacky has proposed that the objects clause should be changed. Which of the following is correct in this regard? a. Zacky can do it alone b. All four of them will have to vote for it c. Zacky and Ehsaan, Fasil can do it together d. Zacky can do it if Ehsaan and Fasil support him 8) Which of the following is incorrect?

a. All courts below the house of lords may refer a case involving European Law to European court of Justice b. The house of Lords must refer a case involving European Law to European Court of Justice For a preliminary ruling c. An English court is not bound to give effect to a preliminary ruling by a European court of Justice d. Europen Union Law is a source of English legal system 9)Which of the following statements can be regarded as incorrect with regard to the law of misrepresentation? a. Misrepresentation can make a contract voidable b. A victim of fraudulent misrepresentation can ask for recission and damages c. A false statement of facts can lead to remedies for both contract and tort d. Damages are available for innocent misrepresentation under the Misrepresentation Act 10) Aminda Ltd carried out a substantial property transactions with one of its directors. Which of the following is incorrect in this regard? a. The assets must have a value of 100,000 or 10% of the companies net assets subject to a minimum of 2,000 b. The transaction should be approved by the shareholders c. The director must disclose his interests in the transaction 11) The following clauses are included in Hasitha Ltd Articles of Association .The breach of which would not be enforceable against the company as a breach of contract? a. Shareholders wishing to sell shares shall offer them to directors who will buy them at a fair price determined by the auditors b. Perera a shareholder shall be the managing director for life c. Dividends will be paid to shareholders in cash d. All shareholders are entitled to attend and vote at the general meeting of the company 12) Which of the following statements are correct? a. Harshana signed a contract after Sathiyan brought to his notice a clause before the time of the contract and therefore the contract is valid b. A clause brought to notice after the signing of a contract is not valid c. A person cannot be bound by a clause written in small print 13) What will be the continuity of employment Sara will need to claim under the sex discrimination act? a. More than 2 years b.None c.1 year d.2 years 14) a. b. c. d. Mewan has employed Anjali which of the following is normally implied into the employment contract? An employees duty to disclose her misconduct A duty to pay wages A duty to provide a reference A duty to provide work

15) Gayum a director is confused with regard to the rules relating to an EGM which of the following are correct? a. An EGM needs 21 days notice if the meeting is being called to consider a special resolution b. An EGM can be called at a short notice if majority of the members holding 95% of the shares agree c. An EGM requires 14 days notice if the meeting is being called to consider an ordinary resolution d. An EGM needs 21days notice if the meeting is being called to consider and extraordinary resolution

16) Which of the following are correct?

a. The directors must act in accordance with the directions issued by the shareholders in the form of ordinary resolution b. The majority shareholders can interfere with the management of the company unless articles prevent them from doing so c. The shareholders may alter the articles of association provided that board decisions are subject to shareholder approval d. Individual shareholders can interfere with the management of the company 17) a. b. c. d. Which of the following is incorrect with regard to a company? A company must include its authorised share capital in its articles A company cannot be registered with the same name as a company already in the register The directors of a newly registered company cannot also act as directors of another company In order to register a company the promoters should submit a memorandum of association to the Registrar of companies Which of the following as a general rule amount to consideration? A promise to pay the amount due at an earlier date A promise to do an act in return for an early payment A promise to carry out an existing contract A promise to do more than what was originally agreed

18) a. b. c. d.

19) There is an insolvent liquidation. Which of the following creditors will be paid in priority to the other creditors? a. The holders of floating charge debentures b. The unsecured creditors c. The inland revenue d. The holders of fixed charge debentures

20) Roshani Ltd a wholesaler has agreed to sell to Sajith Ltd a retailer certain goods. A clause in the
invoice states that provisions of the Sale of Goods act of 1979 will not apply. What is the position?

a. Valid (sales and goods act is only applicable on sales to final customers)
b. Void c. Voidable d. Unenforceable 21) a. b. c. d. Aanish employs. Which of the following duties are generally not implied? The duty to provide work The duty to obey the employers lawful instructions The duty not to disclose confidential information The duty to maintain mutual trust and confidence

22) Which of the following resolutions do not generally have to be filed with the registrar of companies a. Ordinary Resolution b. Special Resolution c. Extraordinary resolution d. Elective Resolution 23) a. b. c. d. Patrick advertised his car for sale for 10,000. Which of the following are correct in this regard? The advertisement is an invitation to treat If Shaheen called him and asked him if he can pay in two instalments he his making a counter offer The advertisement is an offer which can be accepted by any one who can pay the price If Shashitha called him and said he would take the car this would be acceptance

24) Annabel dismisses Kemith which of the following is correct? a. She may rely on any information discovered after the dismissal to justify a wrongful dismissal b. She may rely on information after the dismissal to justify an unfair dismissal c. A tribunal can take into consideration Annabels conduct when determining how much of compensation to award Kemith 25) Which of the following may not be applicable to a private company which is about to declare a dividend? a. The company must have accumulated realised profits b. There must be profits available for distribution as dividend c. The companies net assets should be equal to the total called up share capital plus undistributed reserves d. The company must take account of accumulated realised losses 26) a. b. c. d. 27) a. b. c. d. Which of the following is incorrect? The house of lords is bound by a previous House Of Lords Ratio Decidendi A ratio decidendi of the house of lords is binding on the high court A ratio decidendi of the court of appeal is binding on the High court A ratio decidendi of the House of Lords is binding on the Court of Appeal Which of the following is incorrect in relation to resolutions? Elective resolutions can only be passed by private companies An elective resolution requires 14 days notice An elective resolution can be cancelled by ordinary resolution An elective resolution requires the unanimous consent of all the share holders

28) Which of the following are incorrect about a written resolution? a. A written resolution may be used instead of holding a general meeting b. A written resolution is valid when it has been signed by all who can attend and vote at a company meeting c. Written resolutions can be passed by private companies d. A written resolution can be used instead of any ordinary, special or extraordinary resolution 29) Which of the following can be considered as incorrect with regard to a capital reduction scheme? a. A company may reduce its capital for any reason what so ever as long as the correct procedure is undertaken b. A capital reduction must be authorised by a special resolution c. The reduction should be approved by a court d. The reduction should not affect the companies creditors 30) Memorandum of a company authorises its directors to borrow up to 150,000.Which of the following is correct if the directors take a loan of 200,000 a. The loan is void as the company has acted ultra vires b. The directors have resolved to obtain the loan the transaction is lawful c. As the directors have exceeded their authority the bank cannot enforce the loan against D Ltd d. The loan is ultra vires the directors will be personally liable for any loss caused to their company since they have exceeded their authority 31) Tom is the sole director of XYZ Ltd. The company is considering purchasing Toms business for 200,000. Which of the following is incorrect? Tom cannot contract with XYZ Ltd as he would be placing himself in a conflict of interest and duty situation. b. The purchase consideration may be in the form of cash or shares. c. The shareholders may approve the arrangement by passing an ordinary resolution. d. Tom must formally disclose his interest in the contract to the board.

32) Jo is employed as management accountant of a large retailer. Jo has been invited to take a holiday all expenses paid at a villa owned by the managing director of a supplier organisation. If Jo accepts the invitation, which of the following fundamental principles of CIMAs Code of Ethics will be compromised? Professional Behavior Integrity Confidentiality Objectivity

33

Who is entitled to sue under Section 459 of the Companies Act 1985, which empowers the court to grant a remedy in the event of the companys affairs being conducted in a manner unfairly prejudicial to the interests of its members? The holders of at least 10% of the companys issued share capital. The shareholders as a whole. Any member. The directors. Which of the following is incorrect? A floating charge must be registered at Companies House within 21 days of its creation, otherwise the charge is void against the other creditors. b. A floating charge must be registered at the companys registered office, but a failure to do so does not affect the validity of the charge. c. The procedures from the sale of the assets comprised in the floating charge must first be used to pay off the preferential creditors. d. A floating charge is a charge over a class of company assets which the company is unable to deal with freely in the ordinary course of the business. Which of the following is not associated with a values-based approach to ethics? Easier Grey Discretionary Slow burner Which of the following statements is correct? b) If a company acts outside its objects clause the transaction is void. c) A company may change its objects by passing a special resolution. d) If the directors cause the company to act ultra vires, the company may sue them for breach of fiduciary duty. (ii) and (iii) only and (ii) only (ii) and (ii) only (i), (ii) and (iii). 37 Which of the following are recommended by the Combined Code? (iii) The role of Chairman and Managing Director should be separated. (iv) A senior independent director should be identified and available as a contact for shareholders. (v) At least one-quarter of the board should be made up if independent non-executive directors. (iv) and (iii) only (i), (ii) and (iii) (iv) only

(i) and (ii) only

38

Which of the following types of committee is NOT required by the UK Combined Code? Risk Management Committee Audit Committee Remuneration Committee Appointment Committee

39

Which of the following statements is correct? Whether a worker is an employee or an independent contractor depends entirely on the application of the control test. b. The question as to whether a worker is an employee or an independent contractor is one of law. c. The question as to whether a worker is an employee or an independent contractor is one of fact and law. d. The question as to whether a worker is an employee or an independent contractor is one of fact.

40

XYZ plc has an authorized share capital of 20m divided into 20 million ordinary shares. The company has an issued share capital of 10 million ordinary 1 shares. The current market value of each share is 5. The company intends to raise 30m by issuing a further 10 million ordinary 1 shares at 3 each. Which of the following is correct? issued. The company must increase the authorized capital to 50m before the shares be The issue is lawful as long as the directors have the authority to issue the shares. The consideration for the shares must be valued by the companys auditor. The shares cannot be issued at 3 each as that would mean that they have been issued

at a discount. 41 In relation to the duties of care and skill owed by directors, what is the standard of behavior expected by the law? a. b. c. d. 42 To To To To take the same care as an accomplished professional take reasonable step in every transaction take the same care as he/she would if acting entirely for his/her own private benefit act as a reasonably diligent person having the general knowledge, skill and expertise of a direct

Which of the fundamental principles of CIMA s Code of Ethics is defined as follows? A professional accountant should act diligently and in accordance with applicable technical and professional standards a. b. c. d. Professional competence and due care Integrity Objectivity Professional behavior 43 Which of the following is NOT one of the seven principles of public life, as defined by the Committee of Standards in Public Life? a. Professionalism

b. c. d.

Integrity Leadership Honesty

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a. b. c. d. 45

A breach of the Regulation contained in the Health and Safety at Work Act 1974 by an employer will give rise to: Criminal and civil liability. Neither civil nor criminal liability. Civil liability. Criminal liability only.

Which of the following remedies is not available for a breach of a contract to provide personal services? a. b. c. d. Rescission. Damages. An injunction. A decree of specific performance.

46

Which of the following is NOT one of the main requirement of the combined code? a. b. c. d. The The The The establishment of an audit committee. separation of roles of Chairman and Managing Director. appointment of a senior Government representative to the Board. appointment of independent non-executive director to the Board.

47

Which of the following is the responsibility of the Chairmen, according to the Combined Code? a. b. c. d. Controlling the workings of the Board. Authorizing major investment. Carrying out the policies pf the Board Operational Control

48

Which of the following may be liable to contribute to the assets of the company in the event of the company carrying on business at a time when it appeared that insolvency was inevitable? The The The The current current current current directors and former shareholders of the company. directors of the company directors an shareholders of the company and former directors of the company.

49

Which ONE of the following statements is correct in relation to the Combined Code? If the Code is ignored by any company, no action may be taken as it has legal status. b. If a listed public company fails to produce a report explaining why it has not implemented the codes recommendations, it has acted in breach of the Code. c. If any company fails to comply with the code, the directors may be sued for breach of duty by the company on behalf of the shareholders. d. If a public company fails to comply with the Code, it may be sued for breach of statutory duty by those who have suffered loss as a result.

50

Which of the following is NOT one of the main requirement of the Combined Code? The establishment of a company website. The appointment of a competent Company Secretary.

The appointment of independent non-executive directors of the Board. The separation of the roles of Chairman and Managing Director.

51

Which of the following is the superior source of law? a. b. c. d. A A A A Regulation issued by the European Council of Ministers. Statutory Instrument. decision by the House of Lords. provision in an of Parliament.

52

Which of the following is NOT a financial stakeholder of an organization? a. b. c. d. Competitor Employee Government Customer

53

In relation to contractual performance, which of the following is incorrect? a. If one party is prevented from performing the contact by the other party , he or she may claim compensation on a quantum meruit basis. b. A person who has carried out part of the contract is always entitled to a part of the contract price. c. A person who has substantially performed a contact is entitled to the contract price less so much as is necessary to repair the defects. d. A person who has carried out all of his contractual obligations is entitled to all of the contract price. 54 XYZ plc has recently acted breach of its contract with ABC Ltd. The breach caused ABC Ltd to lose several thousand pounds. The breach of ABC Ltd has resolved not to proceed against XYZ Ltd, as it believes that the time and expense involved would be disadvantageous to the company. A number of ABC Ltd shareholders are dissatisfied with the boards decision. Individual shareholder cannot interfere with the boards decision. b. If the shareholders are dissatisfied with the directors they may vote to remove them from office. c. If the directors are removed from office, they may be entitled to damages for breach of their service contracts. d. If the shareholders pass an ordinary resolution requiring the board to proceed against XYZ Ltd, the board will be obliged to comply with the resolution.

55

Which of the following is normally not an implied term of a contract of employment? The The The The . duty to maintain mutual trust and confidence. duty not to disclose confidential information. duty to obey the employers lawful instructions. duty to provide work.

56

Which of the following is incorrect in relation to the remedy of damages? Damages are designed to compensate the innocent party and to punish the contract breaker. A contract breaker is liable for special losses which are within his contemplation. A contract breaker is liable for losses which arise naturally from breach.

Damages will not normally be awarded for the distress caused to the innocent party by the breach.

57

Which of the following is not associated with a compliance-based to ethics? a. b. c. d. Values driven Mandatory Explicit Fear driven

58

Which of the following is correct? i ii Auditors owe contractual obligations to the company which appointed them. Auditors owe a duty of care to the directors of the company which appointed them.

iii Auditors can never own a duty of care to the shareholders if the company which appointed them. a. b. c. d. (i) and (ii) only. (i), (ii) and (iii). (ii) and (iii) only. (i) only.

59

Which of the following statement is correct? a. An employer years continuity of employment. b. An employer c. An employer d. An employer

only has a duty to provide a reference for employees with one has a duty to provide a full and comprehensive reference. has a duty to provide a reference. has no duty to provide a reference.

60

Which of the following is normally implied into a contract of employment? a. A duty to pay wages. b. A duty to provide a reference. c. An employees duty to disclose his own misconduct. d. A duty to provide work. In the UK, the body responsible for reviewing the regulatory activities of the professional accountancy bodies is: a. b. c. d. The The The The Financial Reporting Council. professional Oversight Board for Accountancy. international Federation of Accountancy. Financial Review Board.

61

62

Consider the following statements. i ii has In general a person is assumed to know of a clause of which ha has been given reasonable notice at or before the time of the contract. In general a person cannot rely on a clause brought to the other partys attention after the contract been concluded.

iii In general a person cannot be bound by a clause written in small print. Choose one of the following. a. Only (i) and (ii) are correct. b. Only (i) and (iii) are correct. c. Only (ii) and (iii) are correct. d. (i), (ii) and (iii) are correct.

63

Which of the following is a financial stakeholders of an organization? a. Competitor b. Non-government organizations c. Media d. Employee Which of the following statement is correct? (i) A wrongful dismissal cannot also be an dismissal. (ii) An unfair dismissal can also be a wrongful dismissal. (iii) An unfair dismissal must also be a wrongful dismissal. (i) b. c. d. (ii) and (iii) (ii) (iii)

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65

Which of the following statement is incorrect in relation to a public company limited by shares? a. b. c. d. The The The The company must company must company must company must have at least two shareholders. have issued at least 50,000 of shares. state that it is a public limited company in its Memorandum of Association. have at least one director.

66

Which of the following is NOT one of the fundamental principles of CIMAS Code of Ethics? Objectivity Professional behavior. Integrity Accountability Which of the following type of committee is NOT required by the UK Combined Cobe? a. b. Remuneration committee. d. Appointment committee. Investment committee. Audit committee

67

68

Which of the fundamental principles of CIMA s Code of Ethics is defined as follows? A professional Accountant should be straightforward and honest in all professional and business relationships a. b. c. d. Objectivity Professional competence and due care. Integrity. Professional behavior.

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69

Which of the fundamental principles of CIMA s Code of Ethics is defined as follows? A professional accountant should not allow bias, conflict of interest or undue influence of other to override professional or business judgments a. b. c. d. Professional competence and due care. Integrity. Professional behavior. Objectivity.

70

Which of the following is correct? a. A contract is frustrated when a party expressly agrees to manufacture and supply goods and then discovers that they will be far more expensive to produce than they thought at the time of the contract. b. A contract is frustrated when something happens, after it has been entered into, which renders the contract impossible to perform. c. A contract is frustrated when something happens, after it has been entered into, which renders the contact more difficult to perform. d. A contract is frustrated if it is impossible to perform at the time that it is mode.

71

Which of the following most accurately describes the ratio decidendi? a. It is a statement of law by a court which are called upon to decide similar case. b. It is a statement of law by a court courts which are called upon to decide similar case. c. It is a statement of law by a court which are called upon to decide similar case. d. It is a statement of law by a court which are called upon to decide similar case. Which of the following statement is correct?

which is binding on all future courts which is not binding on all lower which is binding on all lower courts which is binding on all higher courts

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(i). To succeed in the tort of negligence, a claimant must show that the defendant owed him duty of care. (ii).To succeed in the tort of negligence, the defendant must have broken a duty to take care. (iii) To succeed in the tort of negligence, it is necessary to show that the claimant suffered loss or harm as a result of the defendant s breach of duty. a. b. c. d. 73 (i), (ii) and (iii). (i) and (iii) only. (ii) and (iii) only. (i) and (ii) only.

Which of the following statement Incorrect? (i) A team may be implied into a contract on the basis of previous dealings between the parties. (ii) A team may be implied into a contract by statute. (iii) A team may be implied into a contract by a court where it would reasonable to imply it. (i) only. b. (i) and (ii) only c. d.

(iii) only. (ii) only

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74

According to the Combined Code, who is responsible for setting the companys values and standerds/ a. The shareholders b. The Chairman. c. The Managing Director. d. The Board. ABC Ltd has resolved to purchase the business of ST Ltd for 500,000.ABC Ltd is to pay ST Ltd for the business by issuing ordinary 1 shares rather than cash. As the market value of ABC Ltd s shares is 5 per share, ABC Ltd is to issue to ST Ltd 100,000 ordinary 1 shares. Which of the following is incorrect? a. consideration. b. new shares to its existing members. c. the companys auditor. d. the shares. The issue is lawful as ABC Ltd may issue its shares for a non-cash The issue is lawful because ABC Ltd dose not need to first offer the The issue is lawful if ABC Ltd arranges to have the business valued by The issue is lawful if the director have the necessary authority to issue

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