Multiple choice Flashcards
In acompany voluntary arrangement (“CVA”), who is legally responsible for the proposal to creditors?
a) The nominee
b) The supervisor
c) The proposed insolvency practitioner
d) The directors
d)The directors
In an administration what maximum sum is classified as a small debt including VAT. Is it?
a) £250
b) £500
c) £750
d) £1,000
d)£1,000
A director who without reasonable grounds swore the declaration of solvency in a members’ voluntary liquidation (“MVL”) was later found guilty of perjury. What are the possible consequences of this for the director?a)Imprisonment
b) Disqualification as a director c)Fine
d) Imprisonment and/or fine
d)Imprisonment and/or fine
Which SIP provides guidance in respect of disposal of assets to connected parties in an insolvency process?
a) SIP 11
b) SIP 13
c) SIP 15
d) SIP 16
b)SIP 13
n a compulsory liquidation how much is the fixed fee payable to the Insolvency Service, sometimes known as the Official Receiver’s fixed general fee. Is it?
a) £4,000
b) £5,000
c) £6,000
d) £7,000
c)£6,000
A company entered into a CVA whereby thedirectors agreed that the company wouldpay monthly contributionsof £5,000 for the period of five years. However despite several chasing letters being sent from the supervisor the company stopped paying the contributions after the first six months giving no reason. What action should the supervisor take?
a) Refer to the requirements set out in theAct
b) Refer to the terms of the company’s proposals(and modifications)
c) Apply to Court for directions
d) Refer to SIP 3.2
b)Refer to the terms of the company’s proposals(and modifications)
What is the maximum period that an administration can be extended by creditors.
a) Six months
b) Nine months
c) Twelve months d)Eighteen months
c)Twelve months
Ignoring consent to short notice, how many clear days’ notice mustbe given to the members to hold a general meeting of membersof a limited company(unless the company’s articles specify a longer notice period is required). Is it?
a) 7 days
b) 10 days
c) 14 days
d) 21 days
c)14 days
When the Official Receiver is appointed liquidator within what periodfrom the making of the winding-up order must he decide whether or not to seek nominationsfora liquidator by the creditors and contributories. Is it?
a) At any time
b) No requirement unless creditors request (one quarter in value)
c) 8 weeks
d) 12 weeks
d)12 weeks
In a MVL the liquidator has submitted his final account to the registrar of companies. When is the company dissolved?
a) Forthwith
b) After 8 weeks
c) After 3 months
d) On the date prescribed by the liquidator
c)After 3 months
Where the debtor provides a statement of affairs with his/her proposal for anIndividual Voluntary Arrangement, the statement of affairs shall be made up to a date not earlier thanhow long before the date of the notice to the nominee?
(a) 5 days
(b) 7 days
(c) 2 weeks
(d) 1 month
(c) 2 weeks
In a Members Voluntary Liquidation, within what period prior to the winding up resolution must theDeclaration of Solvency be sworn?
(a) 5 weeks
(b) 4 weeks
(c) 3 weeks
(d) 6 week
(a) 5 weeks
Where a creditor claims that the trustee’s remuneration is excessive, any secured or any unsecured creditor, with the concurrence of what percent in value of thecreditors including that creditor, may apply to court to challenge the level of remuneration?
(a) 5%
(b) 10%
(c) 25%
(d) 50%
(b) 10%
Which one of the following may not propose a Company Voluntary Arrangement?
(a) Directors
(b) Administrative Receiver
(c) Administrator
(d) Liquidator
(b) Administrative Receiver
What SIP deals with office holders’ remuneration?
(a) SIP 7
(b) SIP 8
(c) SIP 9
(d) SIP 10
(c) SIP 9
Which one of the following is not a non-provable debt in a bankruptcy?
(a) A fine imposed for any offence
(b) An obligation to pay a lump sum arising under an Order in family proceedings
(c) An obligation to make monthly payments under an Order in family proceedings
(d) An obligation arising under a confiscation order make under the Drug Offences Act
(b) An obligation to pay a lump sum arising under an Order in family proceedings
For a successful application for a Debt Relief Order, the maximum allowable monthly surplus incomethat an individual may have must be less than what amount?
(a) £50
(b) £100
(c) £10
(d) £0
(a) £50
At any time after the presentation of a winding up petition, the court may appoint a Liquidatorprovisionally. When such a Liquidator is provisionally appointed, what are his powers?
(a) As set out in the order appointing him
(b) The same powers as a Liquidator
(c) The same powers as a Receiver
(d) The same powers as an Administrator
(a) As set out in the order appointing him
Within what period after the anniversary of an Administrative Receiver’s appointment must he filehis statutory account of receipts and payments?
(a) 2 months
(b) 1 month
(c) 28 days
(d) 6 weeks
(a) 2 months
What SIP deals with the presentation of financial information in insolvency proceedings?
(a) SIP 1
(b) SIP 7
(c) SIP 10
(d) SIP 13
(b)SIP 7
Within what period following the last day for proving should a Liquidator deal with every creditor’sproof by admitting or rejecting it in whole or part?
(a) 4 months
(b) 14 days
(c) 5 business days
(d) 2 months
(c)5 business days
Where an Interim Order is in force, which one of the following statements is not true?
(a) No bankruptcy petition may be presented against the debtor
(b) No possession proceedings may be commenced against the debtor’s property by a mortgagee
(c) No execution or legal process may be commenced or continued without leave of Court
(d) No landlord may exercise any right of forfeiture by peaceful re-entry without leave of Court
(b)No possession proceedings may be commenced against the debtor’s property by a mortgagee
What is the ‘relevant time’ period for a transaction that may be challenged as a preference unders340 of the Act against an associate of the bankrupt?
(a) 2 years immediately preceding a bankruptcy order
(b) 2 years immediately preceding a bankruptcy petition
(c) 6 months immediately preceding a bankruptcy order
(d) 6 months immediately preceding a bankruptcy petition
(b)2 years immediately preceding a bankruptcy petition
Within how many days are an Administrator’s proposals deemed to have been accepted followingthe circulation of the statement of his proposals and where no creditors’ meeting has been convenedor such a request for a meeting has been received?
(a) 7 days
(b) 28 days
(c) 8 business days
(d) 5 business days
(c)8 business days
Which one of the following are not entitled to view the proofs of debt lodged with a Trustee?
(a) A creditor who has submitted a proof
(b) A person acting on behalf of a creditor who has submitted a proof
(c) The debtor
(d) A creditor who has a claim but has not yet lodged a proof
(d)A creditor who has a claim but has not yet lodged a proof
Which of these is not one of the objectives of Administration in accordance with Paragraph 3(1) ofSchedule B1?
(a) Realising property in order to make a distribution to one or more secured or preferentialcreditors
(b) To enable a sale of the business as a going concern
(c) Rescuing the company as a going concern
(d) Achieving a better result for the company’s creditors as a whole than would be likely if thecompany were wound up
(b)To enable a sale of the business as a going concern
Who is not entitled to propose a Company Voluntary Arrangement?
(a) The liquidator
(b) The administrator
(c) The directors
(d) The company
(d)The company
Where the Directors of a Company wish to obtain a Moratorium, they must supply information tothe Nominee. The Nominee must then opine by submitting to the Directors a statement. Which ofthese are not included in the Nominee’s statement?(a)Meetings of the Company and its Creditors should be summoned to consider the proposedvoluntary arrangement.
(b) The proposed voluntary arrangement has a reasonable prospect of being approved andimplemented
(c) The Directors have made a full disclosure of the Company’s affairs
(d) The Company is likely to have sufficient funds available to it during the proposed moratoriumto enable it to carry on business.
(c)The Directors have made a full disclosure of the Company’s affairs
Which one of the following is a provable debt in bankruptcy proceedings in accordance with theRules?
(a) A parking fine
(b) Monthly maintenance assessment payments
(c) A Confiscation Order under the Proceeds of Crime Act 2002
(d) A maintenance assessment lump sum award
(d) A maintenance assessment lump sum award
If an Interim Order is in place for a proposed IVA, how many days prior to its expiry should theNominee lodge his report to Court?
(a) 5 business days
(b) 2 business days
(c) 2 days
(d) 5 days
(b) 2 business days
Which of the following is not a formal requirement of the Act which the Court must be satisfiedwith before making an Interim Order for a proposed IVA?
(a) The debtor intends to make a proposal to his creditors
(b) On the day of the application the debtor was an undischarged bankrupt or able to petition for bankruptcy
(c) The major creditor(s) have indicated its/their willingness to consent to theproposed IVA
(d) No previous application for an Interim Order has been made in the preceding 12 months
(c) The major creditor(s) have indicated its/their willingness to consent to theproposed IVA
Where an IVA is approved after a bankruptcy order has been made at a time when the debtor is anundischarged bankrupt, the Court may order the following, apart from which one?
(a) Annul the bankruptcy order
(b) Give directions on the conduct of the bankruptcy
(c) Give directions on the administration of the bankrupt’s estate to facilitate theimplementation of the IVA
(d) Grant the bankrupt’s discharge from bankruptcy
(d) Grant the bankrupt’s discharge from bankruptcy
Within how many business days following the directors’ filling Notice of Intention to AppointAdministrators do the directors have to file Notice of Appointment of Administrators?
(a) 5 BD
(b) 7 BD
(c) 10 BD
(d) 14 BD
(c) 10 BD
Which of the following is not a definition of a company’s inability to pay its debts for the purposes ofan insolvent winding up?
(a) Failure to pay or compound for a sum exceeding £750 three weeks after thepresentation of a statutory demand
(b) Failure to account to HMRC for VAT or PAYE within 30 days of the due date for payment
(c) Failure to satisfy an execution or Court judgment in whole or in part
(d) An assessment by the Court that the value of a company’s assets is less than the amountof its liabilities
(b) Failure to account to HMRC for VAT or PAYE within 30 days of the due date for payment
Within how many business days following meetings of members and creditors held to considerproposals for a Company Voluntary Arrangement does the Chairman have to file his report inCourt?
(a) 4 days
(b) 5 days
(c) 14 days
(d) 2 days
(a) 4 days
Which Schedule of the Act deals with the powers of an administrative receiver?
(a) Schedule 1
(b) Schedule 4
(c) Schedule 6
(d) Schedule 10
(a) Schedule 1
A supervisor of an IVA may not challenge any antecedent transactions apart from which one of thefollowing?
(a) Transactions defrauding creditors
(b) Extortionate credit transactions
(c) Preferences
(d) Transactions at an undervalue
(a) Transactions defrauding creditors
hich one of the following assets would be included in a bankruptcy estate?
(a) Property held by the bankrupt on trust for a third party
(b) A car of modest value to enable the bankrupt to commute to work
(c) Rights under a personal pension policy
(d) An inheritance from the bankrupt’s late mother’s estate
(d) An inheritance from the bankrupt’s late mother’s estate
What is the minimum period of notice a liquidator must give when convening a meeting of creditorsin a compulsory liquidation?
(a) 7 days
(b) 14 days
(c) 21 days
(d) 28 days
(a) 7 days
What is the maximum length of time for which a bankrupt may be subject to an Income PaymentOrder?
(a) 3 years from the date of the bankruptcy order
(b) 5 years from the date of the bankruptcy order
(c) 3 years from the date of the income payment order
(d) 5 years from the date of the income payment order
(c) 3 years from the date of the income payment order
Under s235 of the Act which of the following parties are not under a duty to co-operate with theoffice holder?
(a) Officers of the company
(b) Employees of the company
(c) Shareholders of the company
(d) Anyone who has acted as administrator of the company
(c) Shareholders of the company
In accordance with s84 of the Act how many business days’ notice of a resolution for voluntarywinding up should be given to a holder of qualifying floating charge?
(a) 2 days prior to the passing of the resolution
(b) Within 7 days following the passing of the resolution
(c) At the same time that notice of the proposed resolution is sent to shareholders
(d) 5 or more days prior to the passing of the resolution
d) 5 or more days prior to the passing of the resolution
On what basis may an Administrator dispense with the requirement to call an initial meeting ofcreditors?
(a) Where the consent of more than 75% in total of creditors has been obtained
(b) The Administrator considers it uneconomical to convene a meeting
(c) That neither the objective of (a) or (b) of Paragraph 3(1) can be achieved
(d) The business and assets of the Company were sold via a pre-packaged Administration
(c) That neither the objective of (a) or (b) of Paragraph 3(1) can be achieved
Which one of the following statements concerning the effect of a s313 ‘charging order’ is false?
(a) A charging order secures a trustee’s interest in a dwelling house on behalf of the bankruptcyestate
(b) A dwelling house means a property which is occupied by the bankrupt or by his spouse orformer spouse or by his civil partner or former civil partner
(c) Once a charging order is obtained the property will remain vested in the trustee on behalf ofthe bankruptcy estate
(d) The amount secured by the charging order is the value of the bankrupt’s interest in theproperty as at the date of that order (plus interest thereafter)
(c) Once a charging order is obtained the property will remain vested in the trustee on behalf ofthe bankruptcy estate
Where no steps are taken to obtain a moratorium, to whom does the nominee submit his report onthe prospect of a Company Voluntary Arrangement being approved and implemented?
(a) The creditors
(b) The Court
(c) The Official Receiver
(d) The directors
(b) The Court
At a creditors’ meeting to approve a debtor’s proposal for an IVA, held pre 6.4.2010 what is therequisite majority to pass a modification to the proposals?(a) In excess of three-quarters in value of the creditors voting on the resolution(b) In excess of one half in value of the creditors voting on the resolution(c) In excess of three-quarters in number of the creditors voting on the resolution(d) In excess of one half in number of the creditors voting on the resolution
(a) In excess of three-quarters in value of the creditors voting on the resolution
Within what period must an administrative receiver deliver an abstract of receipts and payments tothe registrar of companies?(a) Within 1 month after the end of 12 months from the date of his appointment and everysubsequent period of 12 months(b) Within 2 months after the end of 12 months from the date of his appointment and everysubsequent period of 6 months(c) Within 1 month after the end of 12 months from the date of his appointment and everysubsequent period of 6 months(d) Within 2 months after the end of 12 months from the date of his appointment and everysubsequent period of 12 months
(d) Within 2 months after the end of 12 months from the date of his appointment and everysubsequent period of 12 months
Whichone of the following assets would fall under the three year time limit provisions imposed bys283A?(a) Interest in a dwelling house occupied as the main residence by the bankrupt’s formercommon law partner(b) Interest in a dwelling house occupied as the main residence by the bankrupt’s former spouse(c) Interest in a building plot purchased for the family home(d) Interest in an investment property
(b) Interest in a dwelling house occupied as the main residence by the bankrupt’s former spouse
Which of the following can disclaim onerous property?(a) A liquidator(b) An administrator(c) A supervisor of a Company Voluntary Arrangement(d) All of the above
(a) A liquidator
Which one of the following is not included in the contents of a creditor’s bankruptcy petition?(a) The name in which the debtor carries on business, if any(b) The debtor’s residential address(c) The debtor’s date of birth(d) The debtor’s occupation, if any
(c) The debtor’s date of birth
Under s235 which one of the following parties are not under a duty to co-operate with the officeholder?(a) Officers of the company(b) Employees of the company(c) Shareholders of the company(d) Anyone who has acted as administrator of the company
(c) Shareholders of the company
A debtor’s proposal for an IVA under s256A (no interim order) was rejected. The debtor is notsubject to any formal insolvency proceedings and wants to put forward revised proposals for an IVA to his creditors. How long must he wait before he can do so?(a) No time restriction(b) 12 months from date of the creditors’ meeting(c) 12 months from the date of the proposals(d) 12 months from the date of filing the chairman’s report at court
(a) No time restriction
According to SIP 17, which is not a power of an administrative receiver in respect of books andrecords?(a) Power to destroy pre appointment records(b) Power to return pre appointment records to directors(c) Power to change the registered office(d) Power to take possession of statutory records for safekeeping
(a) Power to destroy pre appointment records
Which one of the following persons is not an associate for the purposes of the Insolvency Act 1986s435?(a) The individual’s reputed civil partner(b) The individual’s former business partner(c) The individual’s former accountant(d) The individual’s former employee
(c) The individual’s former accountant
Who is not required to submit a D return on the conduct of the directors?(a) An administrative receiver(b) A liquidator in a creditors’ voluntary liquidation(c) A liquidator in a members’ voluntary liquidation(d) An administrator
(c) A liquidator in a members’ voluntary liquidation
Which one of the following statements in relation to a debtor who has deliberately omitted assetsor creditors in order to gain approval of his proposals for a voluntary arrangement is true?(a) The debtor will have committed a civil offence preventing him from entering into this or anyother arrangement for 12 months(b) The debtor will have committed a civil offence terminating any approved voluntaryarrangement(c) The debtor will have committed a criminal offence (with a maximum penalty of seven yearsimprisonment and fine) only where the proposals have been approved(d) The debtor will have committed a criminal offence (with a maximum penalty of seven yearsimprisonment and fine) whether or not his proposals are approved by creditors.
(d) The debtor will have committed a criminal offence (with a maximum penalty of seven yearsimprisonment and fine) whether or not his proposals are approved by creditors.
In a liquidation where the company is not in administration, what exchange rate should be usedwhen calculating a claim for dividend purposes?(a) The rate at the date of liquidation(b) The rate at the date the liquidator issues notice to declare a dividend(c) The rate at the date of the proof of debt is accepted(d) The average rate over the preceding 12 months
(a) The rate at the date of liquidation
Which one of the following statements in relation to the effect of an Interim Order under IA s252 isfalse?(a) An Interim order will prevent a HCEO from completing execution on behalf of a judgmentcreditor(b) An Interim Order will prevent the enforcement of a criminal compensation order(c) An Interim Order will prevent a landlord from distraining for arrears of rent(d) An Interim Order will prevent a creditor from petitioning for the debtor’s bankruptcy
(b) An Interim Order will prevent the enforcement of a criminal compensation order
n an administration, how many creditors may join a creditors’ committee?(a) Two or less(b) Between three and five inclusive(c) At least five(d) As many as want to be involved
(b) Between three and five inclusive
Which one of the following statements is true in relation to a statutory demand?(a) A statutory demand is a written demand for repayment within 10 days(b) A statutory demand is a written demand for repayment within 28 days(c) A statutory demand is issued by the court(d) A statutory demand is issued by a creditor
(d) A statutory demand is issued by a creditor
A holder of a qualifying floating charge may not appoint an Administrator under paragraph 14 ofschedule B1 to the Act unless he has given how many days written notice to the holder of any priorfloating charge?(a) One business day(b) Two business days(c) Five business days(d) Seven business days
(c) Five business days
How many days does a court appointed administrator have to file notice of his appointment with theRegistrar of Companies?(a) 7 days(b) 14 days(c) 21 days(d) 28 days
(a) 7 days
Which one of the following statements is true in relation to the distribution of a dividend by thetrustee?(a) The trustee must declare a dividend within four months of the first meeting of creditors(b) The trustee must declare a dividend whenever he has sufficient monies in hand for thepurpose and after allowing for likely expenses of the bankruptcy(c) The trustee may declare a dividend at any time and is not obliged to make any provision forcreditors who have not yet proved their debts(d) The trustee may recall a dividend if creditors come to light who had not proved before thedeclaration of that dividend
(b) The trustee must declare a dividend whenever he has sufficient monies in hand for thepurpose and after allowing for likely expenses of the bankruptcy
In which one of the following cases would a payment made by a debtor to a supplier (and which wasnot also a transaction at undervalue) five months before the debtor filed the petition on which hewas made bankrupt, be caught by s340 of the IA (preference provisions)?(a) The payment was made in the ordinary course of business(b) The recipient made no more supplies to the debtor(c) The debtor was not insolvent at the time(d) The debtor was insolvent at the time
(d) The debtor was insolvent at the time
In a Creditors Voluntary Liquidation, how long does a liquidator have to file a statement of affairsonce received?(a) 48 hours(b) 5 business days(c) 7 business days(d) 21 business days
(b) 5 business days
A Bankruptcy Restrictions Order may be made only on the application of which one of thefollowing?(a) The Secretary of State(b) The Trustee, other than the Official Receiver(c) The Official Receiver in his capacity as Trustee(d) The petitioning creditor
(a) The Secretary of State
According to SIP 11, when handling funds in formal insolvency appointments, which is not true?(a) Case funds should be maintained separately from those of the office holder or his firm(b) Interest payable on funds held by the office holder should be credited to the account of the case(c) Funds paid into a firm’s trust account should be paid into the case account as soon as possible(d) Cheques may be cleared through the office holders office account until a specific case accountis opened
(d) Cheques may be cleared through the office holders office account until a specific case accountis opened
Where no Interim Order is to be obtained, within what period must the Nominee lodge his reportat court?(a) 7 days from receipt of the proposal from the debtor(b) 14 days from receipt of the proposal from the debtor(c) 21 days from receipt of the proposal from the debtor(d) There is no requirement to lodge the report at court
(d) There is no requirement to lodge the report at court
In an administrative receivership, when are directors required to submit a statement of affairs?(a) Within 21 days of being requested to(b) Within 28 days of being requested to(c) Within 6 weeks of being requested to(d) Within 2 months of being requested to
(a) Within 21 days of being requested to
How much is the Individual Voluntary Arrangement Registration Fee?(a) £5(b) £10(c) £15(d) £20
(c) £15
If a creditor’s proof of debt is rejected for dividend purposes, how long following receipt of theNotice of Rejection has a creditor to lodge an appeal with the court?(a) 7 days(b) 14 days(c) 21 days(d) 28 days
(c) 21 days
Which one of the following statements is false?(a) The individual insolvency register is maintained by the Secretary of State(b) The individual insolvency register contains information on bankruptcies and on individualvoluntary arrangements(c) Bankruptcy restrictions orders are recorded in the bankruptcy restrictions register(d) Bankruptcy restrictions orders are recorded in the individual insolvency register
(d) Bankruptcy restrictions orders are recorded in the individual insolvency register
Which Statement of Insolvency Practice deals with an officeholder’s investigations into the affairs ofcompanies in Administration and Insolvent liquidation?(a) SIP 1(b) SIP 2(c) SIP 4(d) SIP 9
(b) SIP 2
Which section of the Act outlines the actions that may be taken in relation to wrongful trading?(a) Section 212(b) Section 214(c) Section 216(d) Section 218
(b) Section 214
Within what time period must a dissenting creditor who had notice of the meeting apply to courtunder Section 262 of the Act to challenge the meeting’s decision?(a) 14 days from the date of the meeting(b) 14 days from the date of filing the meeting report at court(c) 28 days from the date of the meeting(d) 28 days from the date of filing the meeting report at court
(d) 28 days from the date of filing the meeting report at court
Where an Administration order has been made, within what period (other than a longer period asthe court may allow) should an Administrator present his proposals to a meeting of creditors?(a) Less than 2 weeks(b) Less than 3 weeks(c) Less than 8 weeks(d) Less than 10 weeks
(d) Less than 10 weeks
Which one of the following statements in relation to the Supervisor of an IVA isnot true?(a) The supervisor may apply to court for directions on any matter(b) The supervisor may only apply to court for directions where an interim order was firstobtained(c) The court may appoint a person to replace the existing supervisor(d) The court may appoint a person to act as supervisor alongside the existing supervisor
(b) The supervisor may only apply to court for directions where an interim order was firstobtained
Where an Administrator serves the prescribed notice on a person to submit a statement of affairswithin what period (subject to any requests for an extension of time) must the person submit thestatement of affairs?(a) Before end of 7 days(b) Before end of 10 days(c) Before end of 11 days(d) Before end of 14 days
(c) Before end of 11 days
Conversion from bankruptcy into an IVA will not be available to a debtor in which one of thefollowing circumstances?(a) Where the debtor is an undischarged bankrupt (b) Where the debtor is a discharged bankrupt (c) Where no interim order has been applied for (d) Where the Official Receiver is the proposed nominee
(b) Where the debtor is a discharged bankrupt
How often must a Supervisor report to creditors?(a) Not less often than once every 6 months(b) Not less often than once every 12 months(c) On first anniversary and then by agreement with creditors(d) As often as the proposal directs
(b) Not less often than once every 12 months
Which of the following would not give rise to an automatic termination of membership of aCreditors Committee in an Administration?(a) Person found to be a shadow director of the company(b) Person becomes bankrupt(c) Person fails to attend three consecutive meetings(d) Person ceases to be a credito
(a) Person found to be a shadow director of the company
Under Section 283A of the Act, the trustee in Bankruptcy in a post Enterprise Act case has how longto deal with his interest in the debtor’s dwelling house?(a) One year from the date of the bankruptcy(b) One year from the date of his appointment(c) Three years from the date of the bankruptcy(d) Three years from the date of his appointment
(c) Three years from the date of the bankruptcy
For what period should the Insolvency Practitioner’s Case Record be retained?(a) 5 years from the date of appointment(b) 10 years from the date of appointment (c) 6 years from the date of release or the date on which the specific bond in respect of the caseexpired, whichever is the later(d) 10 years from the date of release or the date on which the specific bond in respect of thecase expired, whichever is the later
(c) 6 years from the date of release or the date on which the specific bond in respect of the caseexpired, whichever is the later
Which one of the following statements isnot true in relation to a Creditors’ Committee in a Bankruptcy?(a) A creditors’ committee can be established in a general meeting of the bankrupt’s creditors(b) Where the official receiver is trustee the functions of the creditors’ committee are vested inthe Secretary of State(c) If there is no creditors’ committee and the official receiver is not trustee, the functions of thecommittee are vested in the court(d) A fully secured creditor cannot be a member of the creditors’ committee
(c) If there is no creditors’ committee and the official receiver is not trustee, the functions of thecommittee are vested in the court
Whose agent is an Administrative Receiver?(a) The company’s (b) The creditors’(c) The directors’(d) The shareholders’
(a) The company’s
Discharge from Bankruptcy has the effect of?(a) Releasing the estate back to the debtor (b) Releasing the debtor from bankruptcy debts (c) Releasing the Trustee from his obligations (d) Terminating a creditor’s rights to prove in the bankruptcy
(b) Releasing the debtor from bankruptcy debts
Under Paragraph 3(1) to Schedule B1 of the Act, what is the primary objective of the Administratorof the company?(a) To achieve a better result for the company’s creditors as a whole than would be likely if thecompany were wound up(b) To make a distribution to one or more secured or preferential creditors(c) To achieve a going concern sale of the business(d) To rescue the company as a going concern
(d) To rescue the company as a going concern
Which one of the following statements relating to annulment of a Bankruptcy order isnottrue?(a) A bankruptcy order cannot be annulled after the date of discharge(b) The court may annul a bankruptcy order at any time(c) There is no requirement to advertise an order of annulment(d) If the Official Receiver has notified creditors of the bankruptcy order, he must forthwithnotify them of the annulment
(a) A bankruptcy order cannot be annulled after the date of discharge
What is the quorum for a meeting of the liquidation committee in a Creditors’ VoluntaryLiquidation?(a) At least two members present or represented(b) At least one member present(c) At least three members present(d) At least three members present or represented
(a) At least two members present or represented
The principle of equity of exoneration enables which one of the following results?(a) A person to claim an interest in a property through direct contribution(b) A person to claim an interest in a property through indirect contribution(c) A person to marshal all or part of a secured debt against another person thus increasing theirown share in the equity(d) A person to treat a secured debt as unsecured thus increasing the available equity in theproperty
(c) A person to marshal all or part of a secured debt against another person thus increasing theirown share in the equity
Within what period must the Official Receiver decide whether to summon meetings of thecompany’s creditors and contributories for the purpose of choosing a liquidator, if not so requestedby the company’s creditors?(a) 4 months from the date of the winding up order(b) 3 months from the date of the winding up order(c) 12 weeks from the date of the winding up order(d) 8 weeks from the date of the winding up order
(c) 12 weeks from the date of the winding up order
Within what time period must the Trustee supply a copy of his latest receipts and payments accounton request from any creditor or the debtor?(a) 7 days(b) 14 days(c) 21 days(d) 28 days
(b) 14 days
An Administrator appointed by Administration Order shall send a notice of his appointment to theRegistrar of Companies within what period?(a) 7 days of the date of the order(b) 10 days of the date of the order(c) 10 days of receiving notice from a qualifying floating charge holder(d) 7 days of receiving notice from the directors of the company
(a) 7 days of the date of the order
Which of the following is a statutory basis for fixing the Trustee’s remuneration?(a) As a percentage of the value of the assets which are realised and/or distributed(b) As a percentage of the value of assets remaining after distribution to unsecured creditors(c) At a fixed rate determined by the petitioning creditor having regard to the complexity of thecase(d) At a fixed rate determined by the appointing creditor/Secretary of State having regard to thecomplexity of the case
(a) As a percentage of the value of the assets which are realised and/or distributed
Which of the following appointments may usually be accepted where there has previously existed a
significant professional relationship between the entity and the proposed office holder?
A Administrator
B Supervisor of a company voluntary arrangement
C Liquidator in a members’ voluntary liquidation
D Liquidator in a creditors’ voluntary liquidation
E Fixed charge receiver
C Liquidator in a members’ voluntary liquidation
An insolvency practitioner should not accept appointment where either a practice, a partner, or a person who, at the time of the appointment is employed by the practice, has acted as auditor in the previous: A One year B Two years C Three years D Four years E Five years
C Three years
Which of the following appointments may usually be accepted?
A Liquidator of an insolvent company following acting as administrative receiver of that company
B Liquidator of an insolvent company following acting as an LPA receiver
C Liquidator in a compulsory winding up having previously acted as administrator
D Liquidator in a compulsory winding up having previously acted as supervisor of a company
voluntary arrangement in relation to that company
C Liquidator in a compulsory winding up having previously acted as administrator
D Liquidator in a compulsory winding up having previously acted as supervisor of a company
voluntary arrangement in relation to that company
In which of the following cases is the office holder not required to report on the conduct of the directors? A Members' voluntary liquidation B Creditors' voluntary liquidation C Compulsory liquidation D Administration
A Members’ voluntary liquidation
In a CVL, the Secretary of State must make an application for a disqualification order within what
period from the date of the resolution to wind up?
A 12 months
B 2 years
C 3 years
D There is no time limit
C 3 years
For which of the following periods may a director be disqualified?
A 1 year
B Minimum period of 1 year, maximum period of 5 years
C 5 years
D 2 years
E Minimum period of 2 years, maximum period of 15 years
E Minimum period of 2 years, maximum period of 15 years
Within what period from the relevant date should the responsible office holder submit a return on
the directors of a company?
A 3 months (or whatever time deemed fit by SoS)
B 12 months
C 18 months
D 24 months
E As soon as practically possible
A 3 months (or whatever time deemed fit by SoS)
A company went into members’ voluntary liquidation on 24 March 20X1. By which date must the
liquidator have given notice of his appointment to the creditors of the company?
A 7 April 20X1
B 14 April 20X1
C 21 April 20X1
D 24 April 20X1
C: Liquidator must give notice to creditors within 28 days
What constitutes a quorum at a meeting of a liquidation committee in a CVL?
A Two members present or represented
B Three members present or represented
C One member present or represented
D A majority of members present or represented
E All members present or represented
A Two members present or represented
When is a creditors’ voluntary liquidation deemed to commence?
A Date resolution for winding up is passed by the creditors of the company
B Date Board of Directors pass a resolution recommending CVL to the members
C Date resolution for winding up is passed by the members
D Date resolution for winding up is advertised in the Gazette
C Date resolution for winding up is passed by the members
C Date resolution for winding up is passed by the members
B 14 days
What value of creditors may require the Official Receiver to convene a meeting of the company's creditors? A One third in value B One quarter in value C Majority in number D Majority in value E Three quarters in value
B One quarter in value
What of the following does not have to be proven for a liquidator to take action for a preference
given to a connected party?
A Person preferred must be a creditor, guarantor or surety
B The company must have been insolvent at the time of or as a result of the preference
C There must have been a desire to prefer
D The preference must have taken place at a relevant time
C There must have been a desire to prefer
What is a relevant time for the purposes of an extortionate credit transaction under s244? A One year B Two years C Three years D There is no time limit
C Three years
An action for misfeasance under s212 cannot be taken against which of the following persons?
A A former officer of the company
B A supervisor of the company’s voluntary arrangement
C A liquidator of the company
D An administrative receiver of the company
B A supervisor of the company’s voluntary arrangement
It is worth noting that although s212 does not apply to administrators, administrators can be
subjected to a misfeasance application brought under para 75 Sch B1 rather than s212.
Which of the following office holders has no power to challenge a transaction at an undervalue
under s238?
A An administrative receiver
B A liquidator in a creditors’ voluntary liquidation
C A liquidator in a compulsory liquidation
D An administrator
A An administrative receiver
What is the relevant time period for a transaction at an undervalue to a connected person? A Six months B One year C Two years D There is no time limit
C Two years
If execution is levied in respect of a judgment for more than £500 the CEO must retain the proceeds for how many days? A 7 days B 14 days C 28 days D 1 month
B 14 days
Any disposition of property is void under s127 (unless ratified by the court) if it takes place between
what dates?
A The date of the presentation of the petition and the date of the appointment of the liquidator
B The date of the winding up order and the appointment of the Official Receiver
C The date of the winding up order and the appointment of the liquidator
D The date of the presentation of the petition and the date of the winding up order
D The date of the presentation of the petition and the date of the winding up order
When a liquidator is served with 'notice to elect' he/she must decide whether or not to disclaim within what time period? A 7 days B 14 days C 21 days D 28 days
D 28 days
A debt incurred in a foreign currency must be converted into sterling using the official rate as at what date? A Date the company entered liquidation B Date the debt was incurred C Date of payment of the dividend D Date creditor proved his debt
A Date the company entered liquidation
What is the maximum amount of wage arrears which may be claimed by an employee as a preferential claim? A £508 B £800 C Four weeks' wage arrears D Six months' wage arrears
B £800
Within what time period from the last date for proving must the liquidator declare the dividend? A Within 7 days B Within 28 days C Within two months D Within six months
C Within two months
If a creditor is dissatisfied with the liquidator’s decision regarding his proof he may appeal to the
court within how many days of receiving the liquidator’s statement?
A 7 days
B 14 days
C 21 days
D 28 days
C 21 days
What should the liquidator do with any unclaimed dividends?
A Redistribute the monies amongst the remaining creditors
B Pay the money to the directors
C Retain it to cover the liquidation expenses
D Pay it in to the Insolvency Services Account
D Pay it in to the Insolvency Services Account
The trustee must declare a dividend within what period of time from the last date for proving? A 28 days B 1 month C 2 months D 7 days
C 2 months
Which of the following is not required to be included in the notice of dividend?
A Amounts realised from the sale of assets
B Details of unrealised assets
C Payments made by the trustee
D Whether and if so when, any further dividend is expected to be declared
B Details of unrealised assets
The trustee must deal with every creditor's proof within how many business days of the last date for proving? A 5 B 10 C 15 D 20
A 5
Which of the following debts is not provable in bankruptcy? A Pre-commencement interest B Debt in a foreign currency C Future debt D Claim for dilapidations E Any fine imposed for an offence
E Any fine imposed for an offence
For how long does a bankruptcy order last? A 12 months B Until the bankrupt is discharged C Until the trustee obtains his release D Three years
B Until the bankrupt is discharged
Which of the following is not an effect of the bankrupt being discharged?
A The disabilities of bankruptcy no longer apply
B The bankrupt is released from all bankruptcy debts
C The trustee is released
D The bankrupt retains his duty to assist the trustee
C The trustee is released
Within what period from the date of the bankruptcy order must an application for a BRO be made? A Within one year B Within two years C Within six months D There is no time limit
A Within one year
A BRO may last for how long? A Between two and 15 years B Between one and six years C Between two and six years D Between one and 15 y
A Between two and 15 years
How soon after the date of the Administrator ceasing to be appointed must he file the notice of automatic end of the Administration?
a) Immediately
b) Within 5 business days
c) Within 14 days
d) As soonas reasonably practicable
b)Within 5 business days
What is the deemed time of delivery for a message sent electronically?
a) The close of business on the next business day after it was sent
b) Immediately
c) On receipt of the read receipt
d) 9am on the next business day after it was sent
d) 9am on the next business day after it was sent
What value of the bankrupt’s creditors is required to request the Official Receiver to summon a meeting of the bankrupt’s creditors for the purpose of appointing the Trustee? Is it:
a) Not less than 10%
b) Any creditors with a claim
c) Not less than 75%
d) Not less than 25%
d)Not less than 25%
What is the maximum level of debts for an individual to be eligible for a Debt Relief Order?
a) £5,000
b) £15,000
c) £20,000
d) There is no maximum limit
c) £20,000
Which element of an employee’s claim is wholly preferential without limit?
a) Redundancy
b) Wage arrears
c) Holiday pay
d) Pay in lieu of notice
c)Holiday pay
A meeting has been convened to approve the remuneration of the Trustee. Within what time period must the meeting be advertised in the London Gazette?
a) 7 days before the meeting
b) 14 days before the meeting
c) As soon as reasonably practicable after sending notice to the creditors
d) Advertising is at the discretion of the Trustee
c)As soon as reasonably practicable after sending notice to the creditors
Within how many days after being appointed as Liquidator in a Creditors’ Voluntary Liquidation should a copy or summary of the Statement of Affairs be provided to all creditors?
a) 7 days
b) 14 days
c) 21 days
d) 28 days
d) 28 days
Which one of the following is not a power of an Administrator or Administrative Receiver under Schedule 1 of the Act?
a) Power to use the company seal
b) Power to carry on the business of the company
c) Power to present or defend a petition for the winding up of the company
d) Power to change the company’s name
d) Power to change the company’s name
What is the ‘official exchange rate’ to be used when calculating claims in foreign currencies?
a) The middle exchange rate on the London Foreign Exchange Market at close of business on the relevant day
b) The average exchange rate on the London Foreign Exchange Market atclose of business on the date the debt became due
c) The lowest exchange rate on the London Foreign Exchange Market onthe relevant day
d) The highest exchange rate on the London Foreign Exchange Market onthe relevant day
a)The middle exchange rate on the London Foreign Exchange Market at close of business on the relevant day
In bankruptcy, if a spouse or civil partner at the date of the bankruptcy order has money owed to him/her, which is a bankruptcy debt, their claim is ‘deferred’. If a dividend is payable from the estate where does this deferred claim rank?
a) After payment of preferential debts in full.
b) After payment of preferential debts and unsecured debts in full.
c) After payment of preferential debts, unsecured debts and statutory interest in full.
d) No dividend is payable.
c) After payment of preferential debts, unsecured debts and statutory interest in full.
If the chairman of a creditors’ meeting in a bankruptcy wishes to suspend the meeting for any reason, are they able to do so?
a) Yes –the meeting can be suspended for a period of up to one hour.
b) No –the meeting cannot be suspended, only adjourned.
c) No –the meeting cannot be suspended and is deemed tohave been heldand completed
d) Yes –the meeting can be suspended for any reasonable length of timeas the Chair decides.
a)Yes –the meeting can be suspended for a period of up to one hour.
To whom does the Administrator NOT have to send his Proposals?
a) The Registrar of Companies
b) The Court
c) Every Member of whose address he is aware
d) Every Creditor of whom he is aware
c) Every Member of whose address he is aware
Where an undischarged bankrupt proposes an IVA, which one of the following does not need to be given notice of the application to court for an interim Order?
a) Nominee
b) Official Receiver
c) Creditors
d) Trustee
c)Creditors (NB if applying outside of BK then petitioning creditors should be given notice)
How much does the registration with the Secretary of State of an approved IVA cost?
a) £5
b) £15
c) £35
d) £50
b)£15
Within what period must the liquidator fix his remuneration, in accordance with Rule 18.22 of the Rules, before it defaults to the Realisation Scale set out in Schedule 11 of the Rules?
a) No limit
b) 3 months after issuing the first progress report
c) 12 months
d) 18 months
d) 18 months
