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Receivership, Administration, Liquidation and Dissolution of companies

Unit: Company law

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Practice CPA Company law Receivership, Administration, Liquidation and Dissolution of companies questions with detailed answers and explanations.

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April 2026

 1 Questions
Question 5
​​​​​(a) Explain THREE circumstances in which inspectors may be appointed to investigate the affairs of a company.   
 
(b) Analyse THREE advantages of corporate restructuring through a merger. 
 
(c) Agroline Ltd. is a private company limited by shares. Over the last two years, the company has suffered continuous financial losses and is unable to pay its debts as they fall due. Several creditors have served formal demands, but the company has failed to settle the amounts due. The creditors are now considering legal action against the company. 
 
Required: 
(i) With reference to Agroline Ltd., financial position distinguish between “administration” and 
“liquidation” as insolvency procedures that may be applied to the company.  
 
(ii) Explain TWO legal implications of a liquidation petition presented against the company by its creditors. 


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December 2025

 1 Questions
Question 5b
​ ​​​​Outline the priority of payments during liquidation of a company.


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August 2025

 2 Questions
Question 6c
​​Explain FIVE differences between company administration and company receivership.


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Question 6b
​​Summarise the procedure for voluntary liquidation in a company.


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April 2025

 2 Questions
Question 6b
​​In law, a liquidator is the officer appointed when a company goes into winding-up or liquidation to perform certain duties. 

 With reference to this statement, outline SIX duties of a liquidator.


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Question 6a
​​Identify FOUR types of liquidation of a company.


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December 2024

 2 Questions
Question 7c
​​Explain FOUR objectives of placing a company under administration.


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Question 7a
​​In relation to company liquidation: 

 (i) Explain the term “compulsory liquidation”. 

ii) List FIVE parties who can petition for a compulsory liquidation.


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August 2024

 1 Questions
Question 6b
​​Summarise SEVEN roles of an administrator in a company that is under administration.


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April 2024

 2 Questions
Question 3d
​​Explain the following terms: 

(i) Receivership. 

(ii) Administration. 

(iii) Liquidation.


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Question 3a
​​Outline the priority of distribution of assets of a company after dissolution.


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December 2023

 2 Questions
Question 5b
​​Describe the process of appointing a receiver during the winding up of a company.


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Question 5a
​​Highlight FOUR powers of an administrator in corporate administration.


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August 2023

 2 Questions
Question 4b
​​Highlight SIX offences relating to liquidation of companies.


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Question 2c
​​A company can be wound up for failure to pay its debts. Explain to Edna Makena, one of the creditors of Ushindi Co. Ltd, THREE circumstances under which a company may be deemed unable to pay its debts


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April 2023

 4 Questions
Question 7d
​​With respect to company administration, highlight FIVE powers exercised by an administrator appointed by the court.


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Question 7c
​ ​​​​Highlight the documents that a liquidator must lodge with the registrar of companies when making an application for voluntary winding up of a company.


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Question 6b
​​Highlight SIX powers that a liquidator can exercise without the sanction of the court.


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Question 6a
​​Highlight FOUR grounds upon which the commissioner of insurance might petition for the winding up of a company


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December 2022

 2 Questions
Question 4c
​​Summarise the following in relation to company administration: 

(i) THREE objectives of administration. 

(ii) THREE persons who are entitled to make an application to the Court for an administration order. 

(iii) Highlight FOUR powers exercised by an administrator appointed by the Court.


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Question 7c
​​Highlight FIVE documents that a liquidator must lodge with the Registrar of Companies when making an application for voluntary winding up of a company.


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August 2022

 2 Questions
Question 6c
​​Highlight four grounds for which a company might be liquidated voluntarily.


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Question 6b
​​Explain three circumstances under which the official receiver might apply to the registrar for the early dissolution of a company.


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April 2022

 1 Questions
Question 2a
​​Summarise five circumstances under which a company might be liquidated under the just and equitable ground.


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December 2021

 1 Questions
Question 7b
​​On forming the view that the company is or will be unable to pay its debts, the liquidator shall among other things prepare a statement setting out the financial position of the company. 

Describe five categories of information that a company's statement of financial position should contain.


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September 2021

 1 Questions
Question 6b
​​With reference to liquidation of companies: 

(i) Enumerate four grounds for liquidation under the just and equitable ground. 

(ii) Summarise three consequences of a winding up order.


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May 2021

 1 Questions
Question 7b
​​Outline five circumstances under which an unregistered company can be liquidated.


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November 2020

 1 Questions
Question 5a
​​(i) Describe the powers and duties of the Official Receiver in his capacity as a corporation sole. 

(ii) Highlight seven ways through which the office ofthe Deputy Official Receiver might become vacant.


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November 2019

 2 Questions
Question 5c
​​Standard Limited issued a debenture to Finance Bank years ago. The debenture was described as a fixed and floating charge over all the assets of the company. However, due to inadvertence, the charge was not dated or registered within time. The company is now in liquidation and the loan is in arrears. Finance Bank seeks your legal advice on whether it can rely on the charge to prove its claim in liquidation proceedings ofthe company. 

Advise Finance Bank.


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Question 7a
​​With reference to liquidation of companies:

(i) Outline two powers of the Liquidator exercisable with the sanction of the court.

(ii) Highlight five grounds for compulsory liquidation by the Court.


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May 2019

 1 Questions
Question 7b
​​(i) With reference to liquidation of a company, describe what a liquidator might do in case there is surplus after payment of company's debts provided in the winding up. 

 (ii) Explain three circumstances when a company will be deemed unable to pay its debts.


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May 2018

 1 Questions
Question 7a
​​In the context of corporate insolvency:

(i) Discuss five offences that might be committed by the liquidator before and during liquidation.

(ii) Describe three circumstances under which a person who has ceased to be a liquidator is released from their obligations with respect to a voluntarily liquidated company.


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November 2017

 2 Questions
Question 6b
​​Wheels Limited issued a debenture to East Bank Ltd. four years ago. The debenture was in the bank's standard form described as a fixed and floating charge over all the assets of the company. However, due to inadvertence, the charge was neither dated nor registered within time. The company is now in liquidation and the loan is in arrears. The bank seeks your legal advice as to whether it can rely on the charge to prove its claim in the winding up proceedings of the company. 

Advise East Bank Ltd. on the implications of non registration of the charge.


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Question 6a
​​(i) Describe three ways in which a liquidator might be appointed. 

(ii) Explain six powers of a liquidator exercisable without sanction of the court.


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May 2017

 1 Questions
Question 3a
​​In the context of corporate insolvency:

(i) Outline four grounds upon which the liquidator might resign in a members' voluntary liquidation.

(ii) Explain four instances when the release of a liquidator becomes effective.


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November 2016

 2 Questions
Question 3b
​​Identify two persons who can act as insolvency practitioners in relation to a company.


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Question 3c
​​ With specific reference to offences relating to liquidation, explain four circumstances under which the directors of a limited company might be charged with fraudulent or wrongful trading.


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May 2016

 2 Questions
Question 7b
​​Describe five ways in which a liquidator could distribute the assets of a company in a compulsory winding up.


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Question 7a
​​Identify five persons who might apply to the court for the liquidation of a company.


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November 2015

 2 Questions
Question 1a
​​With respect to corporate insolvency:

(i) Highlight three ways in which a liquidator's powers might be terminated.

(ii) Explain four contents of the official receiver's report.


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Question 2a
​ ​​Sweetwaters Ltd. is a private limited company which was incorporated in 1992. The last annual general meeting (AGM) was held in 2005 and the directors of the company have refused to convene one. The company is uncontroilable as the directors have become sworn enemies. Habbakuk Kiprotich, Micah Kimanzi and Obed Kamau have filed a compulsory winding up petition which has been objected to by John Wanjunji, Luke Manamba and Peter Nyakach. 

Micah Kimanzi and Obed Kamau are children of deceased shareholders while Habakuk Kiprotich and Peter Nyakach are the only surviving shareholders. Luke Manamba and John Wanjunji are the legal representatives of their deceased parents. 

Advise on the following matters: 

(i) The validity of the mode of winding up adopted by the petitioners. 

(ii) The persons entitled to petition for compulsory winding up. 

(iii) Whether or not Sweetwaters Ltd. will be wound up.


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Pilot September 2015

 2 Questions
Question 6a
​​In the context of companies in financial difficulty, distinguish between "winding up" and "receivership".


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Question 5d
​​Explain four grounds under which a court might deem it just and equitable to wind up a company.


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