ACCA · Question 55 · Management, administration and the regulation of companies
Section B - Scenario 4
SCENARIO: 'BioSynth Plc' is a synthetic biology firm. Dr. Aris is a director. BioSynth is approached by an investor offering a lucrative contract to develop a new enzyme. The board of BioSynth declines the contract because the company lacks the specific lab equipment required. Dr. Aris, seeing the potential, resigns from BioSynth and sets up his own private company, 'ArisEnzymes Ltd', which buys the equipment and takes the contract for itself, making a £500,000 profit.
QUESTION: Which specific statutory duty under the Companies Act 2006 has Dr. Aris most likely breached?
Answer options:
Section 171: Duty to act within powers.
Section 174: Duty to exercise reasonable care, skill and diligence.
Section 175: Duty to avoid conflicts of interest.
Section 177: Duty to declare interest in proposed transaction.
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