Association of Chartered Certified Accountants (ACCA) Certification Practice Test

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Which of the following is NOT typically a party that can petition for compulsory liquidation?

The Official Receiver
The Department for Business
The competitors of the company
The company itself

The correct answer is: The competitors of the company

In the context of compulsory liquidation, the entities typically involved in petitioning for this process primarily include those with a direct interest in the company's financial state or structure, such as creditors, the Official Receiver, and sometimes regulatory bodies. The Official Receiver is tasked with managing the liquidation process and has the authority to petition for compulsory liquidation if necessary. The Department for Business can also play a role in matters concerning corporate compliance and can petition when there are breaches of regulation. The company itself may choose to undergo voluntary liquidation; however, it can also enter compulsory liquidation under certain conditions. Competitors of the company, on the other hand, do not have a legal standing to petition for compulsory liquidation. Their interest, while potentially influenced by the company's operational viability, does not constitute a direct claim or loss that would justify initiating such legal proceedings. They lack the necessary legal grounds to act in this capacity, making them an inappropriate party in the context of compulsory liquidation petitions.