Question 1

Section A

In a decentralized autonomous organization (DAO) structured legally as a private limited company, an external 'advisor' named Felix is not officially appointed to the board. However, the officially appointed directors are accustomed to acting in accordance with Felix's directions and instructions on all major financial decisions. What legal classification best describes Felix?

Accepted Answer

Distinguish between the different types of directors based on their behavior and formal appointment.

Question 2

What mistakes do candidates make on this ACCA question?

Accepted Answer

Confusing shadow directors with de facto directors. De facto directors openly act as directors (e.g., signing documents as 'Director') despite lacking formal appointment. Shadow directors hide behind the appointed board.

How to approach this question

Full Answer

Common mistakes

Practice the full ACCA LW — Corporate and Business Law Practice Exam 5

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