CIMA Exam CIMAPRA17-BA4-1 Topic 8 Question 109 Discussion

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

Question #: 109
Topic #: 8

[All CIMAPRA17-BA4-1 Questions]

Which of the following are cases where the veil should be lifted? Select ALL that apply.

AThe pink company - Failed to disclose the full company name on official documents.

BThe orange company - Continues to trade even though it knows it is in irrevocable debt

CThe white company - An investigative journalist reveals that the company has been deliberately avoiding tax.

DThe red company - Continues to trade despite being having small debts.

EThe black company - Trades with a company based in a country experiencing civil war.

Show Suggested Answer

Suggested Answer: D

by Junita at Mar 20, 2025, 01:08 PM

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Carissa

4 days ago

Hmm, I'm not sure about D. Small debts don't seem like enough to warrant piercing the veil. But the other options definitely seem valid to me.

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Wendell

6 days ago

I'm not sure about D and E though. They seem like they could be risky, but not necessarily cases where the veil should be lifted.

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Van

8 days ago

I think the correct answers are B, C, and E. Lifting the corporate veil is justified when a company is insolvent, evading taxes, or engaging in risky international trade during conflict.

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Cordie

11 days ago

I agree with Brett. Those companies are clearly engaging in unethical practices.

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Brett

14 days ago

I think A, B, and C are cases where the veil should be lifted.

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