Please select one option Incorrect option
1. Which of the following applies to a personal liability company?
(a) The Memorandum of Incorporation cannot restrict the transferability of its securities &
the Memorandum of Incorporation must prohibit the company from offering any of its
securities to the public.
(b) The Memorandum of Incorporation must prohibit the company from offering any of its
securities to the public & the Memorandum of Incorporation must state that the company is a
personal liability company
(c) A personal liability company is exempt from having its annual financial statements
audited & The Memorandum of Incorporation cannot restrict the transferability of its
securities
(d) The Memorandum of Incorporation must state that the company is a personal liability
company & a personal liability company is exempt from having its annual financial
statements audited
ANSWER: B (Source: Graded Questions on Auditing 2022- Q13.6 part 4)
2. In terms of the Companies Act 2008, a person who owns shares in a profit company has
a right to inspect the:
(a) company’s Memorandum of Incorporation & company’s record of directors
(b) minutes of directors’ meetings & auditor of the company’s working papers
(c) company’s record of directors & minutes of directors’ meetings
(d) auditor of the company’s working papers & company’s record of directors
ANSWER: A (Source: Graded Questions on Auditing 2022- Q13.6 part 6)
3. In terms of the Companies Act 2008, a listed (public) company must:
(a) prepare its annual financial statements in terms of IFRS& prepare its annual financial
statements within 12 months after its financial year-end
(b) prepare its annual financial statements within 12 months after its financial year-end &
have its annual financial statements externally audited or independently reviewed,
depending on its public interest score
(c) have its annual financial statements externally audited or independently reviewed,
depending on its public interest score & have its annual financial statements approved by the
board and signed by an authorised director
(d) have its annual financial statements approved by the board and signed by an authorised
director & prepare its annual financial statements in terms of IFRS
ANSWER: D (Source: Graded Questions on Auditing 2022- Q13.6 part 8)
4. With regard to the capitalisation of profit companies:
(a) a company’s MOI must set out the classes of shares and the number of shares of each
class, that the company is authorised to issue & shares with a nominal or par value may be
issued provided they are specified as such in the MOI
1. Which of the following applies to a personal liability company?
(a) The Memorandum of Incorporation cannot restrict the transferability of its securities &
the Memorandum of Incorporation must prohibit the company from offering any of its
securities to the public.
(b) The Memorandum of Incorporation must prohibit the company from offering any of its
securities to the public & the Memorandum of Incorporation must state that the company is a
personal liability company
(c) A personal liability company is exempt from having its annual financial statements
audited & The Memorandum of Incorporation cannot restrict the transferability of its
securities
(d) The Memorandum of Incorporation must state that the company is a personal liability
company & a personal liability company is exempt from having its annual financial
statements audited
ANSWER: B (Source: Graded Questions on Auditing 2022- Q13.6 part 4)
2. In terms of the Companies Act 2008, a person who owns shares in a profit company has
a right to inspect the:
(a) company’s Memorandum of Incorporation & company’s record of directors
(b) minutes of directors’ meetings & auditor of the company’s working papers
(c) company’s record of directors & minutes of directors’ meetings
(d) auditor of the company’s working papers & company’s record of directors
ANSWER: A (Source: Graded Questions on Auditing 2022- Q13.6 part 6)
3. In terms of the Companies Act 2008, a listed (public) company must:
(a) prepare its annual financial statements in terms of IFRS& prepare its annual financial
statements within 12 months after its financial year-end
(b) prepare its annual financial statements within 12 months after its financial year-end &
have its annual financial statements externally audited or independently reviewed,
depending on its public interest score
(c) have its annual financial statements externally audited or independently reviewed,
depending on its public interest score & have its annual financial statements approved by the
board and signed by an authorised director
(d) have its annual financial statements approved by the board and signed by an authorised
director & prepare its annual financial statements in terms of IFRS
ANSWER: D (Source: Graded Questions on Auditing 2022- Q13.6 part 8)
4. With regard to the capitalisation of profit companies:
(a) a company’s MOI must set out the classes of shares and the number of shares of each
class, that the company is authorised to issue & shares with a nominal or par value may be
issued provided they are specified as such in the MOI
