ACCA LW · Chapter 10 · Question 7 of 13
Under the Company Directors Disqualification Act 1986, when must the court make a disqualification order?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Where a director of a company which has become insolvent is found to have conduct that makes them unfit to be concerned in the management of a company
Explanation
Section 6 requires the court to disqualify a person who was a director of an insolvent company if their conduct makes them unfit; the order must be for at least two years and not more than fifteen. Other grounds, such as persistent default in filing or conviction of an indictable offence connected with a company, are discretionary. Acting while disqualified is a criminal offence and leads to personal liability for debts incurred.
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