Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

CII > Module 1 - Introduction To Liquidations > Flashcards

Module 1 - Introduction To Liquidations Flashcards

1
Q

What is a Limited Company made up of?

A

Board of Directors (1 or multiple) (run it);
Members / Shareholders (own it);

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

3 Types of Liquidation?

A

Members’ Voluntary Liquidation;
Creditors’ Voluntary Liquidation;
Compulsory Liquidation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Which 2 Liquidations are for Insolvent Companies?

A

Creditors’ Voluntary Liquidation;
Winding up Court

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

2 x Tests for assessing insolvency?

A

Cash Flow Test;
Balance Sheet Test;

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

What is Insolvent in statute?

A

A company is unable to pay their debts as and when they fall due;
Their liabilities outweigh their assets;
County Court Judgement against you has been returned unsatisfied;
Somebody has issued a statutory demand against you and has been returned unpaid

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Why would someone do an MVL?

A

Tax efficient way to extract money from Company (dividend = income unless done by a liquidation - treated as Return on Capital Gains - CGT rather than income tax);

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Minimum amount to be owed to lodge a winding up order?

A

£750.00

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Voluntary Liquidation Process

A

Directors hold a Board Meeting to start process;
Directors give notice to Shareholders there will be a General Meeting to pass a Special Resolution;
Shareholders pass resolution and it is in Liquidation

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Alternative Options to Liquidation?

A

Negotiate a Repayment Plan;
Retention of Title Enforcement;
Lien;
Withold Supply;
Litigate and Execute

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

How much is the Official Receiver’s Fee?

A

Administration Fee - £5,000
General Fee - £6,000

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

What is Section 129?

A

Commencement of Winding Up - date of Presentation of the Petition

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What is Section 247?

A

Goes into Liquidation - Date of the Order

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

What is a Special manager?

A

Someone appointed to help on a case - able to assist where required.
Appointed by Liquidator
Powers are whatever court order says, duties are to help Liquidator

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

MVL - 6 Resolutions to be passed at first Board Meeting

A

Wind up the Company;
Declaration of Solvency;
Notice to QFCH (bank or financial institution or anybody who has a charge of assets) - 5 Business Days;
General Meeting of Members to be held (14 days notice required - if 90% of Shareholders agree, this can be waived (95% if its a PLC));
Chairperson for the Meeting (one of the shareholders);
Distribution in Specie - for Directors to agree that actually instead of just distributing cash, assets can be used in place

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Declaration of Solvency - EODT

A

Declaration the Business is Solvent;
Enquiry made;
Of the opinion;
Company can settle Debts;
In Twelve months

Should be included with an Asset and Liability Sheet

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

How many directors must swear the Declaration of Solvency?

A

If 1 or 2 Directors - all must sign;
If more than 2 - a majority must swear

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Special Resolution

A

Require 75% of Shareholders voting to pass them

18
Q

Ordinary Resolution

A

Require simple majority to be passed

19
Q

4 x Resolutions to be passed at General Meeting

A

To put Company into Liquidation (special);
That the Company may be able to make a distribution in specie (special);
To appoint a Liquidator (ordinary);
To agree any remuneration of Liquidator (ordinary)

20
Q

Timeframe for notifying Gazette that the Company is in Liquidation

A

14 days

21
Q

How long to notify Companies House of Company in Liquidation

A

15 Days

22
Q

How long to tell Gazette and Companies House that a Liquidator has been appointed?

A

14 days

23
Q

Creditors must be informed a Liquidator has been appointed within how many days?

A

28 Days

24
Q

CVL - 9 Resolutions to be passed at Board Meeting

A

Company should be Wound Up;
Statement of Affairs to be prepped;
Agree to convene GM;
Agree chair of GM (notice is 14 days - 90% can waive);
Agree Creditors Decision Procedure (Virtual Meeting or Deemed Consent); (Objection needs to be 10% in value of creditors);
Agree Remuneration of Liquidator;
Give Notice to any QFCH (5 Business Days);
Board agree who they want to be Liquidator

25
Q

3 x Resolutions at CVL GM?

A

Wind up the Company and put it in Liquidation (Special);
Who the Liquidator (ordinary);
Agree Remuneration (ordinary);

26
Q

CVL Notices of a Company in Liquidation?

A

Gazette - 14 Days
Registrar of Companies - 15 Days

27
Q

Notices of a Liquidator being Appointed:

A

Gazette - 14 Days
Registrar - 14 Days
Creditors - 28 Days
Statement of Affairs to Registrar of Companies - 5 Days

28
Q

Fixing of Reports and How Often?

A

Annual Progress Report - every 12 months (within 2 months of the anniversary)
Insolvency Service - CDDA - 3 months

29
Q

How many days do Creditors get after Notice of decision procedure has been delivered in CVL?

A

3 Business Days

30
Q

When must Creditors receive Statement of Affairs?

A

Business day before the decision deadline

31
Q

What is SIP 6?

A

Company History / basic company info

32
Q

What are the ratios for Creditors requesting a Physical meeting?

A

10% in value;
10% in number;
10 creditors in total

33
Q

When must the physical meeting be called if threshold is met?

A

Must be called within 3 business days of being met

34
Q

What is the deadline a creditor can request a physical meeting?

A

A request can be received any time before the decision deadline

35
Q

What is Section 212?

A

Misfeasance

36
Q

What is SIP 1?

A

The Code of Ethics

37
Q

What is the Threat of the Objectivity Principle?

A

Self-Interest Threat

38
Q

What is the Threat of the Independence and Integrity Principle?

A

Self-Review Threat

39
Q

What is the Threat with Significant Professional and Personal Relationship Principle?

A

Familiarity Threat

40
Q

What is the Threat with the Professionalism and Duty of Care Principle?

A

Advocacy Threat

41
Q

What is the Threat with the Confidentiality Principle?

A

Intimidation

CII (17 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions