Association of Chartered Certified Accountants (ACCA) Certification Practice Test

Which of the following is a ground for petition related to the commencement of trading?

1. The business has not commenced trading within a year of being incorporated

2. The business has recorded a profit within a year of incorporation

3. The business has had several investors

4. The business has relocated its headquarters

The correct answer is: The business has not commenced trading within a year of being incorporated

The correct answer is based on the notion of inactivity in a business context, specifically regarding the commencement of trading. A business that has not started trading within a year of incorporation can be subjected to a petition. This reflects the legal considerations that require companies to demonstrate operational activity after a certain period. A lack of trading activity for such an extended duration could indicate that the company is not fulfilling its purpose or could lead to complications regarding its standing. Therefore, this ground is significant as it ensures that businesses remain active participants in the economic environment and do not consume resources or hold legal status without contributing to economic activity. Other options, such as the recording of profit, having investors, or relocating headquarters, do not directly relate to the necessity to commence trading. A business could be profitable or have multiple investors without having engaged in trading activities, and relocation does not necessarily impact the commencement of trading either. Thus, the focus on inactivity in option A makes it the appropriate choice for grounds of petition regarding the commencement of trading.