ACCA Exam 1 - ACTUAL

Which of the following statements in relation to criminal offences is correct?

The county court has jurisdiction in relation to criminal offences

A summary offence is a minor criminal offence

A criminal matter is dealt with under the multi-track procedure

Which TWO of the following courts can hear an appeal directly from a criminal case heard in the magistrates’ court?

Divisional Court of the Queen’s Bench
Court of Appeal
Crown Court
Court of Justice of the European Union

Which of the following is NOT a feature of criminal law?

The burden of proof lies with the claimant
The standard of proof is beyond reasonable doubt
It aims to punish wrongdoers
Correct Answer

Which of the following statements would NOT be binding on a later court?

One which was part of an obiter dictum
One made by a previous court with superior status
One based on a proposition of law rather than a question of fact

For each of the following statements regarding human rights, indicate whether it is true or false.

. True False
Existing legislation must be interpreted in a way which is compatible with the European Convention on Human Rights

The government can never enact new legislation which is incompatible with the European Convention on Human Rights

When interpreting statute, a judge may give words meanings which deviate from their ordinary, everyday meanings, in recognition of the problem the statute was written to address.

Which rule of statutory interpretation does this statement describe?

The golden rule
The mischief rule
The contextual rule

Which TWO of the following statements regarding legislation are correct?

Courts may strike out any legislation which is contrary to the European Convention on Human Rights
The electoral system means that the statute-making process responds to public opinion
Those who draft statute cannot anticipate every case which may arise
An Act always comes into operation immediately after it receives Royal Assent

In contract law, if acceptance is made by means of a letter sent through the post, when is it effective?

When the letter is read
When the letter is posted
When the letter arrives
Correct Answer

Which of the following statements about consideration is true?

It can be performance of a public duty
It must be adequate
It must be sufficient
It must be performance of an existing contractual duty

For each of the following, indicate whether it is an offer or an invitation to treat.

. Offer Invitation to treat

Goods taken to the cash desk at a self-service shop
Goods displayed in a shop window

Fred has contracted with Burt for an extension to be built to his house. Once the work commenced, Fred and his wife found that they were expecting a baby, so it was essential for the work to be completed on time. Fred offered Burt an extra £2,000 as an incentive to do so.

Which of the following statements is true?

Fred and Burt cannot re-negotiate terms once performance has begun
Burt cannot claim the extra £2,000 because he has provided no additional consideration
The original contract has come to an end and a new one exists in its place
As Fred benefited from the work being completed on time, Burt will be able to claim the extra £2,000

Joel and Kerry are the son and daughter of Marion. Marion has asked them to clean their rooms, ready for their grandparents’ visit. She said she would give them each £10 for doing so.

Which TWO of the following statements are true?

There is a lack of mutuality about this arrangement, which means that it will be unenforceable as a contract

This arrangement cannot amount to a contractual agreement because it is not made in a commercial context

Joel, Kerry and Marion do not have the requisite intention to create legal relations

Domestic or family arrangements are usually informal and so the court will be willing to overlook the usual requirements for the formation of a contract

In which of the following situations is it NOT possible for a third party to enforce an obligation?

Where there has been an assignment of the benefit of the contract

Where the contract expressly confers the right for a third party to gain enforcement rights

Where the subject matter of the agreement is a gratuitous promise

For each of the following statements regarding contractual terms, indicate whether it is true or false.

. True False
A representation is a statement which induces the formation of a contract but does not become a term of the contract
A term can be implied into a contract by the courts in order to make the contract work in practice

Which of the following is NOT a type of term?

Warranty
Representation
Condition

Which of the following describes a vital term in a contract?

Guarantee
Condition
Warranty

Rebecca bought a home computer for personal use from a sole trader, trading as Computers to Go. When she got the computer home she found that it didn't work. She returned the computer to the shop, but the retailer refused to refund her money and pointed to a sign placed above the door inside the shop, which she had not seen and which stated:

‘All products must be inspected before any sale is concluded. In the event of any defect, no liability will be accepted and refunds will not be given.’

For each of the following statements, identify whether it is true or false.

The exclusion clause would need to be fair to be effective
The law relating to unfair contract terms will not apply Computers to Go as it is a sole trader

Rebecca is dealing as a consumer

The exclusion clause has been incorporated into the contract with Rebecca

Assuming that the exclusion clause is invalid, which of the following actions can Rebecca take?

Treat the contract as discharged, owing to the anticipatory breach
Terminate the contract and claim damages
Sue for specific performance of the contract only
Sue for specific performance of the contract and claim damages

Which TWO of the following statements regarding contractual terms are correct?

The breach of a warranty entitles the injured party to treat the contract as discharged only
The breach of a warranty entitles the injured party to claim damages only
The breach of a condition entitles the injured party to claim damages only
The breach of a condition entitles the injured party to treat the contract as discharged, and to claim damages

Which of the following is NOT an indicator of self-employed status?

Provision of own tools
Integration with co-workers
Use of substitute labour

Which of the following is NOT a duty owed by an employee?

To indemnify their employer
To exercise reasonable skill and care
To account for all money and property received

For each of the following duties of an employer, indicate whether it is a statutory or a common law duty.

. Common law Statutory
To pay a minimum wage
To provide work for apprentices
To indemnify the employee against expenses and losses
To provide time off work to undertake trade union duties

Which of the following statements regarding redundancy pay is correct?

An employee aged 40 will receive one week’s pay for each year of service
The length of service used in the calculation is subject to a maximum of 25 years
To be entitled to a redundancy payment, an employee must have had continuous employment for one year

Which of the following correctly describes constructive dismissal?

Breach of contract by the employee, causing the employer to dismiss them without notice
Dismissal due to the employer's inability to continue with the employment
Breach of contract by the employer, which causes the employee to resign
Dismissal that cannot be justified by the employer

Which of the following statements regarding summary dismissal is correct?

It is permissible whenever an employee has breached their contract
It means termination of employment with the statutory minimum notice
Without justification, it allows a claim for wrongful dismissal

Which of the following statements concerning the personal liability of an agent on contracts is correct?

An agent who acts on their own behalf but purports to be acting for their principal will not be liable on a contract
An agent is liable on a contract if it is usual business practice for them to be liable
An agent will not be liable even if they intend to take personal liability

In relation to the Limited Partnerships Act 1907, which of the following statements about a limited partnership is true?

The partners must enter into a written partnership agreement
There must be at least one general partner with unlimited liability
The partners all have limited liability for the debts of the partnership

Which of the following statements regarding a partner’s authority is correct?

They can bind the firm if a third party genuinely believes they have authority to do so
They can only bind the firm within the limits of the partnership agreement
They can only bind the firm if they have been given express authority to do so

Which TWO of the following companies CANNOT lawfully be created?

A public limited company with just one member
A public company limited by guarantee
A private limited company without share capital
A public limited company without share capital
Correct Answer

Which of the following documents is NOT required to be registered in order to form a company?

Memorandum of association
The details of the first auditor
Statement of capital and initial shareholdings

The board of directors of ACF Ltd are concerned about a small group of shareholders who are carrying on a business in competition with ACF Ltd. The directors have asked the members to pass a resolution to alter the articles of association. The alteration would give the directors the power to compulsorily purchase the shares of any shareholder who competes with ACF Ltd.

Which TWO of the following statements regarding the alteration to ACF Ltd’s articles of association are correct?

ACF Ltd can alter its articles by passing a written resolution
A resolution to alter ACF Ltd’s articles of association requires a simple majority vote
ACF Ltd must submit a copy of its amended articles to the Registrar
ACF Ltd must hold a general meeting to alter its articles

The members passed the resolution, giving the directors the power requested.

Which of the following statements about the validity of the alteration made to ACF Ltd’s articles is correct, and for what reason?

It is not valid because it forces a shareholder to sell his shares back to ACF Ltd
It is valid as it is bona fide in the interests of the company as a whole

It is not valid as it is unjustified discrimination against the minority

It is valid because it benefits the majority of ACF’s shareholders

For each of the following alterations to a company's articles of association, identify whether it is true or false.

A company's articles can be amended to compel an existing member to subscribe for additional shares in the company

Directors whose contract of employment are contained in the articles can obtain an injunction against the company from altering the articles to remove them from office

In March 20X2, Jaygee plc is seeking to raise capital and therefore allots 100,000 ordinary shares, each with a nominal value of £2, for £4.50 each in cash, giving rise to the share premium of £250,000.

Which TWO of the following statements about the share premium are true?

It can be used for a dividend payment in the following year
It can be used for a dividend payment in the same year
It can be used for an issue of bonus shares in the future
It can be used for the expenses of previous share issues

In March 20X3, the board of Jaygee plc considers an allotment of more £2 ordinary shares. The shares will be partly-paid but carry a premium of £2.50.

What minimum payment for the shares will the purchasers have to make?

50% of the nominal value, plus 50% of the premium
25% of the nominal value, plus the full premium
50% of the nominal value, plus the full premium
25% of the nominal value, plus 25% of the premium

Malcolm wishes to offer a warehouse that he owns in return for a substantial number of the shares to be allotted.

Indicate whether the following statements about Malcolm’s offer are true or false.

. True False
The number of shares which could be purchased in return for the warehouse would be determined by an independent valuation of the building
Malcolm would need to give an undertaking to transfer the property by March 20X8

Nico owns 18% of the preference shares in Velvet Ltd. In a recent class meeting of the preference shareholders, 78% voted in favour of varying the rights attached to those shares. Nico strongly disagrees with the proposed alteration to preference shares rights.

Which of the following statements relating to the alteration of class rights is correct?

The decision of the meeting cannot be contested as more than 75% voted in favour
The decision of the meeting cannot be contested as more than 50% voted in favour
Nico can petition the court to set aside the variation in class rights as she holds more than 15% of the preference shares
The class rights cannot be varied, as more than 15% of the preference shareholders did not vote in favour of the resolution

Which TWO of the following statements concerning the distribution of a company’s dividends are true?

In all cases, the net assets must be no less than the aggregate of its called-up share capital and distributable reserves at the time of the distribution
Even after a dividend is declared and due for payment, there is no obligation for the company to make the distribution
In all cases, the distribution must come from accumulated realised profits, less accumulated realised losses
No distribution may come from the capital redemption reserve

Sophia works for TM Ltd. The board of the company treat her as a director, and hold her out as such to the outside world, even though she has never been properly appointed.

Which of the following describes Sophia's position as a director?

De facto director
De jure director
Shadow director
Alternate director

ACB Ltd is a building maintenance company. Its board of directors comprises three directors, Fred, Paul and Jason. Fred and Paul are in poor health and leave the running of the company's business to Jason. They know that Jason acts as ACB Ltd's managing director although he has never actually been appointed to that position.

Jason decides that it is time for the company to expand. On behalf of the company, Jason instructs a surveyor to report on the suitability of a plot of land for the construction of an apartment block. Fred and Paul are unhappy about this and refuse to pay the surveyor's fees.

ACB Ltd is liable for the surveyor's fees as the board of directors allowed Jason to act as its managing director

Which of the following statements regarding liability for the surveyor's fees is correct?

Jason is personally liable to pay the surveyor's fees because he instructed the report
Jason and his fellow directors are jointly and severally liable for the surveyor's fees
Jason and ACB Ltd, are jointly and severally liable for the surveyor's fees

What type of authority was Jason exercising when he entered into the contract with the surveyor?

Actual
Express
Apparent
Implied

Background
ACB Ltd is a building maintenance company. Its board of directors comprises three directors, Fred, Paul and Jason. Fred and Paul are in poor health and leave the running of the company's business to Jason. They know that Jason acts as ACB Ltd's managing director although he has never actually been appointed to that position.

Jason decides that it is time for the company to expand. On behalf of the company, Jason instructs a surveyor to report on the suitability of a plot of land for the construction of an apartment block. Fred and Paul are unhappy about this and refuse to pay the surveyor's fees.

Task 1 2 of 2 marks
Which of the following statements regarding liability for the surveyor's fees is correct?

ACB Ltd is liable for the surveyor's fees as the board of directors allowed Jason to act as its managing director
Jason is personally liable to pay the surveyor's fees because he instructed the report
Jason and his fellow directors are jointly and severally liable for the surveyor's fees
Jason and ACB Ltd, are jointly and severally liable for the surveyor's f

According to the Companies Act 2006, which of the following is NOT allowed to act as an auditor of a company?

A creditor of the company
A shareholder in the company
An employee of the company

Which types of company must hold an annual general meeting?

Private companies only
Public companies only
Both private and public companies

Badtimes Ltd is experiencing cashflow problems, and the directors believe that unless radical action is taken, insolvency may be unavoidable. The company has been contacted by a floating chargeholder concerned that the company may default on its forthcoming interest payments. The directors have also been contacted by other unsecured creditors to discuss the possibility of putting the company into administration.

For each of Badtimes Ltd’s creditors, indicate whether or not they need a court order to place the company into administration.

. Floating chargeholder Unsecured creditors
Without a court order
With a court order

For each of the following roles of officers involved in financially distressed companies, indicate whether it is carried out by an administrator or a liquidator.

. Administrator Liquidator
To rescue the company as a going concern
To realise and distribute

Which TWO of the following statements apply to a creditors’ voluntary liquidation?

The members’ choice of liquidator will prevail
A liquidation committee is formed
A meeting of members will be called
The company will be solvent
Correct Answer

Janine is a cashier at a bank branch. A customer is angry with her as she has delayed making a transaction, because in Janine's opinion it is an unusual transaction for this customer to make. Janine has called her manager, but he is busy with another client. As the customer begins to shout and become aggressive, Janine tells him that she has to make proper checks because the law requires her to validate unusual transactions.

What offence has Janine potentially committed under the Proceeds of Crime Act 2002?

Disclosure
Failure to report her suspicion
Money laundering
Tipping off

EXL Ltd is a company which sources designer bathroom products from both UK-based and overseas suppliers. Most of EXL Ltd’s overseas business is carried out by local agents on its behalf. Adam, the managing director of EXL Ltd, wants to be sure that the company is complying with the requirements of the Bribery Act 2010. The following matters have come to his attention and he has asked for your advice:

1)

Ravi, a director of EXL Ltd was recently invited to an event hosted by a potential supplier, PNK plc. EXL Ltd is in the process of considering proposals from PNK plc and two other companies and will award a lucrative contract to one of them. During the event, it was announced that Ravi had won a new car in a free prize draw. An employee of PNK plc joked with Ravi that winning the car should help PNK plc win the EXL Ltd contract. At the board meeting which followed, Ravi cast his vote in favour of PNK plc being awarded the contract.

2)

One of the company’s agents overseas is making payments to government officials in order to expedite export licences for goods sent to the UK.

Which of the following statements regarding the car won by Ravi is correct?

Neither PNK plc nor Ravi have committed a bribery offence
Both PNK plc and Ravi have committed a bribery offence
Only Ravi has committed a bribery offence
Only PNK plc has committed a bribery offence

Which of the following statements regarding the actions of EXL Ltd’s agent overseas is correct?
No offence has been committed by EXL Ltd, since its contact overseas is an agent and not an employee
No offence has been committed by EXL Ltd, since the events occurred overseas and not in the UK
EXL Ltd has potentially committed the offence of failure to prevent bribery
EXL Ltd has potentially committed the offence of bribing a foreign public official

For each of the following statements regarding bribery, indicate whether it is true or false.

. True False
A partnership cannot be guilty of the offence of corporate failure to prevent bribery
The directors of a company found guilty of bribery can be sued for compensation for failing to maintain adequate procedures

Andrew is an investment fund manager. He has invested substantially in Greenbat plc, whose shares are not doing very well. He logs onto an investment website under another name and posts false information about Greenbat plc being subject to a takeover. The share price increases dramatically.

Jane is also a fund manager. She buys a large amount of Greenbat plc shares at the end of the trading day in order to increase the share price. The following day, other investors follow this behaviour and Jane sells her shares at a large profit.

Whose behaviour amounts to the offence of market abuse?

Both Andrew’s and Jane’s
Andrew’s only
Jane’s only
Neither Andrew’s nor Jane’s