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CIMA Fundamentals of Ethics - Corporate Governance and Business Law Sample Questions:
1. Which of the following is correct if a promoter orders goods or services on behalf of a company limited by shares which is not yet registered?
(i) The promoter is personally liable for the order.
(ii) The promoter and the company are jointly liable for the order.
(iii) If the company ratifies the order after its registration, the company is liable and the promoter's liability for the order ceases.
A) (i) only
B) (iii) only
C) (i) and (iii) only
D) (ii) only
2. Which of the following is incorrect?
A) The first directors of the company are those persons who are named as directors on Form IN01.
B) A private company must have at least two directors.
C) The board usually has the power to appoint a managing director.
D) A board usually reaches its decisions by majority vote.
3. Which of the following may cause a director to be disqualified from acting as a director under the Company Directors Disqualification Act 1986?
(i) Persistent default by the director in complying with the filing requirements under the Companies Acts.
(ii) Causing a company to continue to trade at a time when the director ought to know that insolvency is inevitable.
(iii) Carrying on business with intent to defraud creditors.
A) (i) only
B) (i) and (ii) only
C) (i), (ii) and (iii)
D) (ii) only
4. How many fundamental principles are identified by the CIMA Code of Ethics?
A) Four
B) Six
C) Five
D) Three
5. In which of the following situations has a contract of employment arisen?
A) A verbal offer of work is made to Q at a given pay rate for specified services. The offer is not accepted by Q either verbally or in writing and Q does not turn up for work
B) A verbal offer of work is made to P at a given pay rate per hour for specified services The offer is not accepted by P either verbally or in writing but P turns up for work and performs the duties identified in the offer.
C) A verbal offer of work is made to S for the possibility of duties at a specified pay rate but the employer makes it explicit that, as the need for the services is not yet certain S is free to work elsewhere
D) A written offer of work is made to R which specifies the services required but omits the pay rate for the job. This is not accepted by R either in writing or verbally and R does not turn up for work
Solutions:
| Question # 1 Answer: A | Question # 2 Answer: B | Question # 3 Answer: C | Question # 4 Answer: C | Question # 5 Answer: B |



