7. Partnerships and Criminal Law

Question 1

Ordinary partnerships are those governed by which act?

Define this act

Answer 1

Partnership Act 1890

The relation which subsists between persons carrying on a business in common with a view of profit

Question 2

State a main provision of the Partnership Act 1890 (ten total)

Answer 2

1. Profits and losses to be shared equally
2. Partners are indemnified by the firm for any liabilities
3. All partners are entitled to take part in the management of the business
4. Records and accounts must be kept at the main place of business, and must be open to inspection by all partners
5. No interest is to be paid on capital except by agreement
6. Any change in business is to be decided unanimously
7. No partner is entitled to remuneration for acting in the partnership business
8. The partnership agreement may be varied with the consent of all the partners
9. Appointment of new partners must be by unanimous vote
10. Exclusion of a partner must be by unanimous vote

Question 3

Where a partner acts outside of the scope of his authority, the partnership is only bound under the circumstances of ______ authority

Answer 3

Apparent

Question 4

Per the PA 1890, where a partner pledges credit of the firm for a purpose with no apparent connection with the firm’s ordinary business, the firm will not be bound unless he has actual ______ authority to do so

Answer 4

Express

Question 5

In a partnership, who has the right of access to the partnership accounts?

Answer 5

Only partners

Question 6

Is there a formality of forming a partnership?

Answer 6

No

Question 7

A plc must file accounts and documents with the Registrar of Companies. Does a partnership?

Answer 7

No

Question 8

A sole tradership is essentially a ______, and in law these two are viewed as the same entity

Answer 8

Partnership

Question 9

Under the Limited Liability Partnership Act 200 (LLPA 200), what five documents must LLPs send to the Registrar?

Answer 9

1. Name of LLP
2. Location of its registered office
3. Address of its registered office
4. Name and addresses of all the members of the LLP
5. Names of the two designated members who are responsible for signing notices and accounts and delivering them to the Registrar

Question 10

Do LLPs have to retain accounting records and prepare annual accounts?

Answer 10

Yes

Question 11

For LLPs, the LLP is primarily liable for debts and obligations of the firm’s business, except in what circumstance?

Answer 11

In cases of negligence, where a member may become personally liable

Question 12

The Enterprise and Regulatory Reform Act 2023 applies and requires that an employee whistleblows why?

Answer 12

Because it is legitimately in the public interest for them to do so

Question 13

For a whistleblower to receive protection under the Public Interest Disclosure Act 1998, it must be disclosed to an ______ person

Answer 13

Appropriate

Question 14

A qualifying whistleblower must show reasonable belief that one of what six is occurring?

Answer 14

1. A criminal offence has been committed
2. A person has failed, is failing or is likely to fail with any legal obligation to which they are subject
3. That a miscarriage of justice has occurred
4. That the health and safety of an individual has been endangered
5. That the environment has, is being or is likely to be damaged
6. That information tending to show any matter falling within these categories has been, is being or is likely to be deliberately concealed

Question 15

If a disclosure for whistleblowing is made in bad faith, what is the penalty?

Answer 15

Award of damages may be reduced by up to 25%

Question 16

Workers who have made a protected disclosure have the right not to suffer a _____

Answer 16

Detriment

Question 17

Any severance agreement which seeks to limit a worker’s rights to make disclosures will be ___\

Answer 17

Void

Question 18

What three ways can fraud be committed per the Fraud Act 2006?

Answer 18

1. Fraud by false representation
2. Fraud by failing to disclose information
3. Fraud by abuse of position

Question 19

Define phishing

Answer 19

Bogus emails trying to elicit personal information

Question 20

What is keylogging?

Answer 20

When criminals’ record what the user is typing

Question 21

What five essential controls are there against cyber crime?

Answer 21

1. Firewalls
2. Applying secure settings
3. Restricting access
4. Protection against viruses
5. Patching (keeping software up to date)

Question 22

What does the Computer Misuse Act 1990 aim to do?

Answer 22

To secure computer material against unauthorised access or modification

Question 23

Insider dealing is defined as a criminal offence by which act?

Answer 23

Criminal Justice Act 1993

Question 24

Define an insider for inside trading

Give a defence for those accused of insider trading

Answer 24

Anyone who is in receipt of inside information

1. The defendant did not expect the dealing to result in profit
2. The defendant reasonably believed the information was publicly available
3. The defendant would have dealt anyway, even if he did not have the information

Question 25

Define bribery

Answer 25

Where a person offers, promises or gives a financial or other advantage to another person, intending this to induce or reward that person for improper performance in relation to a relevant function or activity

Question 26

What is the difference between an active bribery and a passive bribery?

Answer 26

Active bribery: where a person requests or accepts a financial or other advantage Passive bribery: where events take place in respect of a foreign public official

Question 27

What are the three steps to money laundering?

Answer 27

1. Placement 2. Layering 3. Integration

Question 28

What three categories of offence are there under the Proceeds of Crime Act 2002?

Answer 28

1. Laundering 2. Failure to report 3. Tipping off

Question 29

A maximum ____ year prison sentence is possible for money laundering, as well as an _______ fine

Answer 29

14, unlimited

Question 30

Failure to report money laundering is punishable by a _____ year maximum sentence Tipping off money laundering is punishable by a _____ year maximum sentence

Answer 30

Five Two

Question 31

Per the Money Laundering Regulations 2017, who should establish internal systems and procedures to deter criminals from using certain institutions to launder money? (6)

Answer 31

1. Credit and financial institutions 2. Accountants 3. Independent legal advisors 4. Estate agents 5. Casinos 6. High value dealers

Question 32

What are the five fundamental ethical principles for an accountant?

Answer 32

1. Integrity 2. Objectivity 3. Professional competence and due care 4. Confidentiality 5. Professional behaviour