Question Tag: Investment advice

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  • 4 Marks

BL – May 2016 – L1 – SB – Q4a – Law of Tort

Advise on legal action for losses incurred due to professional advice in a business investment.

Femi, an entrepreneur, and his friend Umukan, a Chartered Accountant, are members of the same social club. Femi invited Emike to invest in sachet water business. Emike sought the professional advice of Umukan and paid him a fee for the advice. Umukan informed Emike that Femi’s business was doing well. Emike invested in the business based on Umukan’s professional advice and eventually suffered a loss of ₦350,000. Emike has come to you for advice.

Required:

Advise Emike on his chances of succeeding in a legal action he intends to institute against Umukan.

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  • 10 Marks

BCL – Nov 2017 – L1 – Q3a – Tort, Contract Law

Discuss whether an investor can take action against an investment company for negligent advice leading to financial loss.

a) Bobo Company Limited puts up an advert in the ‘Daily Times’ newspaper inviting members of the public to purchase shares. Mr. Kobina Fosu, an investor, decided to purchase some of the shares. He consulted an investment firm to advise on whether or not he should purchase the shares of the company. The investment firm advised Mr. Kobina Fosu that the company was buoyant and that its capital base was strong and attractive. As a result, Mr. Kobina Fosu bought a substantial number of shares of the company. Two months after the purchase of the shares, however, the company went bankrupt.

Required:
What advice, if any, will you give to Mr. Kobina Fosu? (10 marks)

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  • 10 Marks

BMIS – March 2024 – L1 – Q1a – The business organisation and its stakeholders

Explain five features of a Public Limited Liability Company to a friend considering investment options.

You have been approached by a high school friend for advice as to the form of business organisation in which he should invest. He indicates to you that he does not necessarily want to be directly involved in the day-to-day running of the business because he has family matters to attend to. You intend to recommend that he invests in a public limited liability company.

Required: Explain FIVE (5) features of a Public Limited Liability Company to your friend.

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  • 4 Marks

BL – May 2016 – L1 – SB – Q4a – Law of Tort

Advise on legal action for losses incurred due to professional advice in a business investment.

Femi, an entrepreneur, and his friend Umukan, a Chartered Accountant, are members of the same social club. Femi invited Emike to invest in sachet water business. Emike sought the professional advice of Umukan and paid him a fee for the advice. Umukan informed Emike that Femi’s business was doing well. Emike invested in the business based on Umukan’s professional advice and eventually suffered a loss of ₦350,000. Emike has come to you for advice.

Required:

Advise Emike on his chances of succeeding in a legal action he intends to institute against Umukan.

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  • 10 Marks

BCL – Nov 2017 – L1 – Q3a – Tort, Contract Law

Discuss whether an investor can take action against an investment company for negligent advice leading to financial loss.

a) Bobo Company Limited puts up an advert in the ‘Daily Times’ newspaper inviting members of the public to purchase shares. Mr. Kobina Fosu, an investor, decided to purchase some of the shares. He consulted an investment firm to advise on whether or not he should purchase the shares of the company. The investment firm advised Mr. Kobina Fosu that the company was buoyant and that its capital base was strong and attractive. As a result, Mr. Kobina Fosu bought a substantial number of shares of the company. Two months after the purchase of the shares, however, the company went bankrupt.

Required:
What advice, if any, will you give to Mr. Kobina Fosu? (10 marks)

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  • 10 Marks

BMIS – March 2024 – L1 – Q1a – The business organisation and its stakeholders

Explain five features of a Public Limited Liability Company to a friend considering investment options.

You have been approached by a high school friend for advice as to the form of business organisation in which he should invest. He indicates to you that he does not necessarily want to be directly involved in the day-to-day running of the business because he has family matters to attend to. You intend to recommend that he invests in a public limited liability company.

Required: Explain FIVE (5) features of a Public Limited Liability Company to your friend.

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