Extra

Question 1

True or False
A person acting as an insolvency practitioner when not qualified to do so commits a criminal offence

Answer 1

True

Question 2

Who is responsible for ensuring that the recognised professional bodies deal with insolvency practictioners in a standardised way?

Answer 2

The Joint Insolvency Committee

Question 3

If a company director, without good caused, fails to answer questions during the course of a private examination, which of the following consequenses are true?
A Prosecution for contempt of court
B A civil penalty for contempt of court
C Automatic disqualification under CDDA
D Automatic public examination

Answer 3

A Prosecution for contempt of court

Question 4

A creditor with a valid ROT is treated as what type of creditor?

Answer 4

Secured

Question 5

Can a liquidator in a compulsor liquidation open a local bank account?

Answer 5

Only with permission of the court

Question 6

Are simple partnerships governed by PA1980 able to create floating charges?

Answer 6

No

Question 7

Are individuals able to create fixed charges?

Answer 7

Yes

Question 8

Which two of the following will not be prevented by an Interim Order:
A Execution of a debt by a judgement creditor
B Presentation of a bankruptcy petition
C Repossession of the debtors car subject to HP agreement
D Repossession of goods subject to an ROT

Answer 8

C D

Question 9

A liquidator has had no response to questions put to director of the Company. Which is the potential consequence?
A the director may be subjected to a private examination
B director ma be prosecuted and fined
C director may dace an accusation of wrongful trading
D director will have to submit to public examination by the creditors

Answer 9

A B

Question 10

Can the official receiver can be appointed as provisional liquidator?

Answer 10

Yes

Question 11

Which of the following must be included within the nominees report to creditors?
A copy of the directors proposals
A summery of SOA
Nominees comments on proposal
Copies of last three years audited accounts

Answer 11

A copy of the directors proposals - YES

A summery of SOA - YES

Nominees comments on proposal - YES

Copies of last three years audited accounts -NO

Question 12

Is there a statutory framework for proving debts in an administrative receivership?

Answer 12

No

Question 13

Does the administrative receiver had a duty to pay preferential creditors?

Answer 13

Yes

Question 14

Can the following ask a question in a public examination of a company director?
The official receiver
Any member
A creditor who has proved in the liquidation
A contributory of the company

Answer 14

The official receiver - YES

Any member - NO

A creditor who has proved in the liquidation - YES

A contributory of the company - YES

Question 15

What percentage by value of the company creditors can compel the Official receiver to apply for a public examination of a liquidator?

Answer 15

50%

Question 16

Who might appoint a special manager to assist with the conduct of liquidation?
A The Official Receiver
B The creditors
C The liquidator or provisional liquidator
D The court

Answer 16

C the liquidator or provisional liquidator

Question 17

Which body is responsible for promoting professional and ethical standards for insolvency professionals?

Answer 17

The JIC

Question 18

Transaction defrauding creditors, will the liquidator have to establish that the Company was insolvency or became so as a result of the transaction?
Is there a time limit?

Answer 18

No and No

Question 19

Give two reasons why the court would not make an order under S238 Insolvency Act (transactions at undervalue)

Answer 19

The transaction was entered into for the benefit of the Company

The Company was acting in good faith

Question 20

In an administration which of the following are qualifying liabilities for which the administrator might be liable if he adopts the contracts:
Wages
Contributions to occupational pension schemes
Redundancy payments
Stat. sick pay
Unfair dismissal awards
Wrongful dismissal awards

Answer 20

Wages YES

Contributions to occupational pension schemes YES

Redundancy payments NO

Stat. sick pay YES

Unfair dismissal awards NO

Wrongful dismissal awards NO

Question 21

If the estranged husband of an undischarged bankrupt brings legal proceedings for financial maintenance the bankruptcy will prevent the order being made?
Yes or No

Answer 21

No

Question 22

Who can bring an action for wrongful trading?
A Supervisor
B Administrator
C Liquidator
D Administrative Receiver

Answer 22

C Liquidator

Question 23

True or False - An administrative receiver has statutory powers to manage the Company

Answer 23

True

Question 24

True or False - An administrative receiver is an officer of the court

Answer 24

False

Question 25

True or false
On the appointment of an administrative receiver the IA1986 triggers the statutory right of the landlord to forfeit the lease?

Answer 25

False

Question 26

True or False
In administrative receivership
A landlord may distrain over any property at the premises regardless of whether or not it is charged in favour of another creditor

Answer 26

True

There is no moratorium in administrative receivership and the landlord has a right to distain over goods at the property

Question 27

A bankrupt owes £25,000 to his wife and £10,000 to her father. In bankruptcy how will these debts be dealt with?

Answer 27

Wife is a deferred creditor

Her father is an unsecured creditor

Question 28

A trustee in bankruptcy has which of the following powers:
1 to commence legal proceedings
2 to sell any assets within the estate
3 to transfer company shares as the bankrupt would have done
4 to carry on the bankrupts business

Answer 28

1 to commence legal proceedings - YES

2 to sell any assets within the estate - YES

3 to transfer company shares as the bankrupt would have done - YES

4 to carry on the bankrupts business - YES

Question 28

If a nominee has been appointed by the debtor following a referral by a third party, the source of the referral must be disclosed to creditors - YEs or No

Any referral fee that the nominee paid to a third party must be disclosed to the creditors - Yes or No

Answer 28

Yes

and

Yes

Question 29

True or false, in an MVL, the liquidator is the agent of the members of the company

Answer 29

True

Question 30

In respect of the effect of the moratorium that applies on appointment of an administrator can a holder of an ROT repossess goods?

Answer 30

The creditor can repossess goods with a court order

Question 31

To RESIGN an administrative receiver must give notice to the following, how many days notice should be given:
Companies House
Person who appointed them

Answer 31

Companies House - 14 days

Person who appointed them - 7 days

Question 32

When instructed to put together a prepack sale, who does the insolvency practitioner act for when acting as advisor?

Directors
Company
Shareholders
Creditors

Answer 32

The Company

Question 33

Which of the following cannot make a court application pursuant to section 304 against a trustee for misapplied monies which the bankrupt’s estate has suffered a loss as a consequence?

The official receiver
The secretary of state
The bankrupt
The bankrupt’s spouse

Answer 33

The bankrupt’s spouse

Question 34

Where a company moves from administration to liquidation under para 83 of Schedule B1 of the Act, who of the following does not need to be given notice of the move to liquidation?

The Registrar of Companies
The directors
The Court
The creditors

Answer 34

The directors

Question 35

How long does the administrator have to submit a statement of affairs to the Registrar of companies?

As soon as reasonably practicable
7 days
14 days
None of the above

Answer 35

As soon as reasonably practicable