ACCA Applied Skills · Corporate and Business Law (Global)
Company Directors for ACCA Applied Skills LW
Company directors are the people who manage a company on behalf of its members. For LW you must know who can be a director, how directors are appointed, and the general rules that apply. Solve questions by reading the facts, naming the rule, then applying it to the scenario.
What this chapter covers
This chapter covers the people who run a company. A company is an artificial legal person. It cannot act for itself, so it acts through its directors. The chapter looks first at how a person becomes a director, because every later rule about duties, powers and removal depends on that.
In the exam you meet this chapter in two ways. Section A tests short rule-recall questions, such as who may appoint a director or what a first director must do. Section B tests multi-task scenarios, where a director's appointment is one fact among several that you must analyse.
The chapter links to other parts of LW. Company formation tells you who the first directors are. Company administration covers the board, shareholders' meetings and resolutions. Later topics on directors' duties, powers and removal build directly on appointment. Agency and corporate governance also draw on it.
LW is examined on the global variant. Where the detail of a rule differs between jurisdictions, learn the general principle as the syllabus presents it. Do not rely on one country's statute.
Directors appear across the whole paper, not just in one chapter. A student who is clear on who directors are and how they are appointed can answer questions in company formation, meetings, duties and governance more quickly. LW has 70 marks of objective questions in Section A, and every question is all or nothing. Short factual rules on appointment are exactly the kind of point that is easy to win if you have learned it precisely and easy to lose if you are vague.
Company directors: topics in the order to study them
- 1Appointment of Company DirectorsThis is the only topic in the chapter and the base for every later rule on directors, so learn who can be appointed and how before moving on to duties, powers and removal.
How to prepare Company directors
Treat this chapter as a set of precise rules plus a method for applying them to facts. Work in short sessions that suit a phone.
- Read the topic once for the big picture: what a director is and why a company needs them.
- Write a one-page list of the rules: who can be a director, who appoints, and how the appointment takes effect.
- Note any qualification or disqualification rules and the exact conditions attached to each.
- Do objective questions on the topic and, for every error, write down the rule you missed in one line.
- Practise a scenario: underline each fact about a person, ask whether they are validly appointed, and state the rule before the conclusion.
- Link the topic to formation, meetings and duties by asking where else a director's status changes the answer.
- Revise your one-page list the day before the exam and test yourself without looking.
Common mistakes in Company directors
Assuming the job title decides whether someone is a director.
Fix: Look at what the person actually does. Someone who acts as a director may be treated as one whatever they are called.
Forgetting to check the company's constitution.
Fix: Add a step to every answer: does the constitution change the general position? Mention it where the facts suggest it.
Mixing up who appoints first directors and later directors.
Fix: Keep two separate lines in your notes, one for first directors and one for later appointments.
Confusing a director with a company secretary or an employee.
Fix: List the role of each in one line and test which one the scenario describes.
Writing a conclusion with no rule behind it in scenario tasks.
Fix: Use the order rule, application, conclusion. Each step earns marks in a multi-task question.
Guessing between two close options in objective questions.
Fix: Learn exact conditions, such as who must act and by what method, so only one option fits.
Last-day revision: Company directors
- A company acts only through people, and directors are the people who manage it.
- A director is defined by the role performed, not by the job title used.
- Know who appoints the first directors and who appoints later ones.
- Shareholders normally appoint directors by passing a resolution.
- The board can often fill a vacancy if the company's constitution allows it.
- Check the company's constitution first, because it may add rules on appointment.
- Know the basic qualifications and disqualifications for holding the office.
- An appointment must be properly made to be valid.
- Know the difference between an executive and a non-executive director.
- A shadow director is someone whose instructions the board habitually follows.
- Always state the rule, apply it to the facts, then give your conclusion.
- In objective questions, read all four options before choosing, as there is no partial credit.
Company directors practice questions
- The articles of Brindle Co allow the board to appoint any person as an additional director, but that person must stand for confirmation at t…
- Kora plc's board needs a new director quickly. Its articles give the existing directors power to appoint additional directors to fill a casu…
- Lumen Ltd's articles require the shareholders to vote on each director individually. At a general meeting, a single resolution proposes to a…
- Karim is appointed a director of Alba Ltd by a board resolution. The articles allow the board to fill casual vacancies but require any direc…
- Brightwell Corp's articles state that directors are appointed by ordinary resolution of the members. At the annual meeting, 60% of the votes…
- Under the usual company law rules covered in LW Global, which of the following people is most likely to be disqualified from being appointed…
- Halden Co's board knew that Rafe, who had never been formally appointed, attended board meetings, signed contracts and was introduced to sup…
- Marlow Co's articles allow the board to appoint a person to fill a casual vacancy until the next annual general meeting, when the person mus…
Company directors in other exams
The same ground in other exams, if you are preparing for more than one or want another angle on it.
Company directors: frequently asked questions
How much of LW is about company directors?
Directors appear in several parts of the paper, so the chapter matters beyond its own questions. Appointment is the base for duties, powers and removal. Learning it well helps across Section A and Section B.
Do I need statute section numbers for directors?
Learn the rules in plain words and their exact conditions first. LW is the global variant, so focus on the general principles in the syllabus rather than one country's section numbers.
How are director questions asked in the LW exam?
Section A uses short objective questions on rules, marked all or nothing. Section B uses scenarios with several tasks, where you apply the rule to the facts. Practise both styles.
How long should I spend on this chapter?
It is short, so a few focused sessions can cover it. Spend extra time on practice questions and on linking it to formation, meetings and duties.