CIMA Exam CIMAPRA17-BA4-1 Topic 7 Question 75 Discussion

Actual exam question for CIMA's CIMAPRA17-BA4-1 exam

Question #: 75
Topic #: 7

Z Ltd intends to participate in a "substantial property transaction" with one of its directors. Which of the following is correct in relation to substantial property transactions?

(i) The value of the asset must exceed 10% of the company's net assets and be more than 5,000.

(ii) The transaction must be approved by the shareholders.

(iii) The director must disclose his interest in the transaction.

A(i) only

B(i) and (ii) only

C(i) and (iii) only

D(i), (ii) and (iii)

Show Suggested Answer

Suggested Answer: A, B, C

by Leota at Oct 06, 2023, 06:05 PM

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Merissa

16 hours ago

Hmm, I'm going with C. The value threshold and director disclosure are important, but maybe the shareholders don't need to be involved if it's a small-ish transaction, you know? Gotta keep those board meetings short and sweet!

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Paola

5 days ago

Easy peasy, it's D! A director can't just go around making big deals without shareholder approval and disclosing their interest. That's like the corporate version of a magic trick - everyone would see right through it!

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Annmarie

11 days ago

I'm not sure, but I think it's important for the director to disclose their interest in the transaction to avoid any conflicts of interest.

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Sherly

12 days ago

I think the correct answer is (i), (ii) and (iii). All three conditions must be met for a substantial property transaction with a director.

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Marget

17 days ago

I agree with Earlean, it makes sense that all conditions need to be fulfilled to ensure transparency and fairness.

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Earlean

26 days ago

I think the answer is D, because all three conditions must be met for a substantial property transaction.

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