SCENARIO 5: Titanium Foundry Ltd went into insolvent liquidation on 1 November. Six months prior, on 1 May, when the company was already hopelessly insolvent, the directors granted a floating charge over the company's inventory to a connected person (the CEO's brother) to secure an old, existing debt of £50,000. No new money was advanced to the company.
Under Section 245 of the Insolvency Act 1986, what is the status of this floating charge?
ACCA · Question 60 · Corporate and Business Law
SCENARIO 5: Titanium Foundry Ltd went into insolvent liquidation on 1 November. Six months prior, on 1 May, when the company was already hopelessly insolvent, the directors granted a floating charge over the company's inventory to a connected person.
During the liquidation, the external auditor discovers that the directors had been hiding stolen funds in the company accounts. The auditor files a Suspicious Activity Report (SAR) with the National Crime Agency. The auditor then calls the directors to warn them that the NCA is investigating. What offence has the auditor committed?
Answer options:
Failure to disclose.
Money laundering.
Tipping off under the Proceeds of Crime Act 2002.
Breach of confidentiality.
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