PREWEEK LECTURE

REGULATORY FRAMEWORK FOR BUSINESS TRANSACTIONS

MAY 2022 CPALE

OBLIGATIONS
1. In an obligation to deliver a generic thing:
a. The debtor is not liable for fraud or delay or negligence in the performance of
the obligation.
b. The debtor can choose which thing pertaining to the class to deliver.
c. The creditor has the right of choice.
d. Loss by fortuitous event extinguishes the obligation.

2. A is obliged to deliver a Rolex watch to B on December 1, 2021.

a. Before December 1, 2021, A has to take care of the Seiko watch with the
diligence of a good father of the family.
b. In case of loss of the Seiko watch by negligence of A, A is liable in damages.
c. A is not required to exercise the diligence of a good father of a family.
d. The obligation of A to B is not valid.

3. Statement 1: Accessions are necessary to the principal thing.

Statement 2: Accessories are not necessary to the principal thing but both must
go together.
a. True; False
b. False; True
c. Both statements are true.
d. Both statements are false.

4. A source of liability is:

a. Dolo causante
b. Pare delicto
c. Dolo incidente
d. Culpa aquiliana

5. Statement 1: If the law or contract does not state the diligence which is to be
observed in the performance of the obligation, neither party is liable for
negligence. F
Statement 2: If a party is negligent and at the same time in bad faith, he shall be
liable for damages by reason of fraud.
a. True; False
b. False; True
c. Both statements are true.
d. Both statements are false.

6. A and B by their joint act of negligence caused damage to X in the sum of P10,000.
a. The obligation is joint because A and B acted jointly.
b. The obligation is joint because there is plurality of debtors.
c. The obligation is solidary because the law so provides.
d. The obligation is solidary because either A or B is liable for the full amount.

7. A is obliged to give B his Mitsubishi, 4-door sedan Lancer with plate number ABC
123 on September 30, 2021. On October 10, 2021, A did not yet deliver the car
which was totally destroyed by an earthquake on such date. Is A still liable?
a. No, the obligation is extinguished. The specific thing was lost due to fortuitous
event and no demand to deliver was made by B.
b. Yes, A is in legal delay. B can claim damages.
c. No, even A is already in default and can plead impossibility of performance.
d. Yes, B can instead demand for another car of equivalent value from A.

8. A owes B P10,000 to be paid after one year. As security A mortgages his car in
favor of B. If before due date the car is lost by fortuitous event:
a. A does not lose the benefit of the period because no one shall be liable for
fortuitous event.
b. A does not lose the benefit of the period if he gives another security equally
satisfactory.
 c. A does not lose the benefit of the period because it was not stipulated.
d. A does not lose the benefit of the period because he is not in delay.

9. In case both parties have committed a breach of the obligation:

a. The second infractor may choose between rescission or fulfillment.
b. The first infractor is more is more liable than the second.
c. Each party must bear his own damage.
d. The liability of the first infractor shall be equitably tempered by the courts.

10.Statement 1: In an alternative obligation either party may choose as to who has

the right of choice.
Statement 2: If it is the creditor who has the right of choice, he loses his choice
if all the prestations are alternatively lost by fault of the debtor.
a. True; False
b. False; True
c. Both statements are true.
d. Both statements are false.

CONTRACTS
11.This kind of defective contract refers to that contract which is validly agreed upon
because all the essential elements exists, but Courts can nullify it when there is
damage or prejudice to one of the parties to a third person. Its enforcement would
cause injustice by reason of some external facts.
a. Voidable Contract
b. Void or inexistent Contract
c. Rescissible Contract
d. Unenforceable Contract

12.Contracts are effective and binding only between the parties, their assigns and
their heirs.
a. Where there is stipulation in favor of a third party.
b. Where one of the parties to the contract dies and thereafter a suit is filed on
the basis of the contact.
c. Where the obligations arising from contract are not transmissible by their
nature.
d. Where the obligations arising from the contract are not transmissible by
stipulation or by provision of law.

13.Three of the following enumerations are exceptions as provided by law which does
not belong to the exception?
a. Where there is stipulation in favor of a third party.
b. Where one of the parties to the contract dies and thereafter a suit is filed on
the basis of the contact.
c. Where the obligations arising from contract are not transmissible by their
nature.
d. Where the obligations arising from the contract are not transmissible by
stipulation or by provision of law.

14.Which of the following contracts cannot be ratified?

a. Those whose cause or object did not exist at the time of the transaction.
b. Unauthorized contracts.
c. Those where both parties are incapable of giving consent.
d. Those that fail to comply with Statute of Frauds

15.Three (3) of the following contracts are void. Which one is valid?
a. Oral contract of partnership of three (3) partners and capital contribution is
more than P3,000.00 in cash.
b. Written contract contemplating impossible services.
c. Oral contract of partnership where real estate is contributed as capital.
d. Agent’s authority to sell property given orally.
16.The obligor is liable for fortuitous event except one. Which is the exception?
a. The law so provides.
b. The obligation to deliver a generic thing.
c. The obligation so provides.
d. The obligation to deliver a determinate thing.

17.There are cases, when the loss of the specific thing even in the absence of fault
and delay will not exempt the debtor from liability. They are:
I. when the law so provides
II. when the stipulation so provides
III. when the nature of the obligation requires the assumption of risk
IV. when the obligation to deliver a specific thing arises from a crime.

a. I, II and III only b. I, II, III and IV

c. I,II and IV only d. I, III and IV

18.The creditor, in addition to the penalty, may recover damages and interests:
I. When so stipulated by the parties
II. When the obligor refuses to pay the penalty, in which case the creditor may
recover legal interest thereon.
III. When the obligor is guilty of fraud in the fulfillment of the obligation, in
which case the creditor may recover damages caused by such fraud.

a. I, II and III b. I and III only

c. I and II only d. II and III only

19.Statement 1: Contracts are perfected by mere consent, and from the moment the
parties are bound not only to the fulfillment of what has been expressly stipulated
but also to all the consequences which, according to their nature, may be keeping
with good faith, usage and law.
Statement 2: Real contracts, such as deposit, pledge and commodatum, are not
perfected until the delivery of the object of the obligation.
a. True, True b. True, False
c. False, True d. False, False

20.The assignment or abandonment of all the properties of the debtor for the benefit
of his creditors in order that the latter may sell the same and apply the proceeds
thereof to the satisfaction of their credits.
a. Dacion en pago b. Application of payment
c. Payment by cession d. Consignation

SALES
21.As a rule, this contract of sale involving a piece of land is void,
a. Between a minor and a capacitated person.
b. Between two insane persons who did not act during lucid interval
c. Between first degree cousins
d. Between husband and wife

22.X, 17 years old, sold to Z, of legal age, her necklace worth P20,000 for P15,000.
Later, Z sold the necklace to Y for P20,000. Which of the following statements is
correct?
a. X has got a voidable title because at the time of sale, she is a minor
b. X can ask for rescission of the sale to Y because she suffered a lesion of more
than ¼ of the value of the property.
c. If Y is in bad faith, Y becomes the owner of the necklace upon delivery to him
but his title is voidable.
d. X can ask for the annulment of the sale to Y because at the time of sale she is
a minor.

23.The sale of the hope itself

a. Dacion en pago
b. Payment by cession
c. Emptio spei
d. Emptio rei-speratae
24.When the owner of the thing sells it to vendee, but continues to have possession
or occupation of the thing not as owner but as tenant or lessee
a. Traditio longa manu
b. Traditio brevi manu
c. Traditio constitutum possessorium
d. Traditio symbolica

25.In a contract of sale, of personal property, the price of which is payable in

installments, the vendor may exercise any of the following remedies, except
a. Exact fulfillment of the obligation should the vendee fail to pay any installment.
b. Cancel the sale, should the vendee’s failure to pay cover two or more
installment.
c. Foreclose the chattel mortgage on the thing sold, if one has been constituted
should the vendee’s failure to pay cover two or more installments.
d. Rescind the sale should the vendee fail to pay any installment.

26.When goods are delivered to the buyer on “sale or return” for period of seven
days, ownership of the goods passes to the buyer
a. Upon perfection of the contract
b. Upon acceptance by the buyer of the offer of the seller
c. Upon expiration of seven days
d. Upon delivery of the goods

27.A sold his only car to B for P300,000 to be paid as follows: P150,000 upon delivery
of the car to B and the balance at P10,000 per month until full payment of the
purchase price. Later the car gets burned in the possession of B through fortuitous
event and without B’s fault, before full payment of the balance. Is B obliged to
pay the balance?
a. No, because the car was lost through fortuitous event and without B’s fault,
hence B’s obligation is extinguished.
b. No, because the loss should be borne by the seller as this an installment sale
so until the buyer pays the full amount of the price of the sale, A remains to
be the owner.
c. Yes, but A must give another car to B because of the principle “genus nunquam
perit” or generic thing never perishes
d. Yes, because the principle “res perit domino” or the thing perishes with the
owner.

28.Not an implied warranty in a contract of sale

a. Right to sell the thing at the time of perfection of the contract
b. Reasonably fit for the purpose they are acquired
c. Merchantable in quality
d. Free from charges or encumbrances not declared or known to the buyer

29.A sold to B his car and promised to deliver ten days later. The next day, after the
sale to B, A sold the same car to C and immediately affected delivery. On the day
agreed upon, A did not deliver the car to B. Which is correct?
a. B can cancel the contract between A and C, because the contract between A
and B was perfected ahead of the contract between A and c
b. B should make the demand to make A in default
c. A is liable to B for the value of the car plus damages after B makes a demand
d. A is liable to B for damages and is in default without need of any demand

30.The redhibitory action based on the faults or defects of animals must be brought
within
a. 30 days from delivery to the vendee
b. 40 days from delivery to the vendee
c. 45 days from delivery to the vendee
d. 6 months from delivery to the vendee
CREDIT TRANSACTIONS

31.When is the pledgor or mortgagor required to be the owner of the thing pledged
or mortgaged for the validity of contracts of pledge, of real estate mortgage or of
chattel mortgage?
a. At the time the principal obligation is constituted.
b. At the time the contract of pledge or mortgage is constituted or perfected.
c. At the time of the failure to pay the principal obligation.
d. At the time the thing to be pledged or mortgaged is to be delivered.

32.It is a stipulation whereby the thing pledged or mortgaged shall automatically

become the property of the creditor in the event of non-payment of the debt within
the term fixed.
a. Pactum creditarium
b. Pactum commissorium
c. Pactum debitarium
d. Pactum crematorium

33.What is the nature of a contract of pledge, of chattel mortgage, of real estate

mortgage or of antichresis?
a. It is divisible if the principal contract is joint.
b. It is indivisible if the principal contract is solidary.
c. It is divisible whether the principal contract is joint or solidary.
d. It is indivisible whether the principal contract is joint or solidary.

34.It is a contract by virtue of which the debtor delivers to the creditor or to a third
person a movable, or instrument evidencing incorporeal rights for the purpose of
securing the fulfillment of a principal obligation with the understanding that when
the obligation is fulfilled, the thing delivered shall be returned with all its fruits
and accessions.
a. Contract of Pledge
b. Contract of Chattel mortgage
c. Contract of Real estate mortgage
d. Contract of Antichresis

35.What is the legal effect of a promise or contract to constitute a pledge?

a. It is perfected by delivery of the thing pledge.
b. It is perfected through the notarization of the promise.
c. It is perfected by mere consent and gives rise only to a personal action
between the contracting parties.
d. It gives rise to a real action over the thing pledged.

36.Which of the following stipulations in a contract of pledge is null and void?

I. A stipulation which provides that the contract of pledge is not extinguished
by the return of the thing pledged.
II. A stipulation allowing the appropriation by the pledgee of the thing pledged
in case the same is not sold in the first and second auctions.
III. A stipulation for the recovery of deficiency in case the proceeds from the
sale of the thing pledged is less than the amount of the obligation.
a. I and III b. I and II
c. II and III d. I, II and III

37.The following are the formalities required for the sale of the thing pledged in case
of failure of the debtor to pay the principal obligation, except
a. It must be by public auction.
b. It must be through a notary public.
c. There must be a notice to the debtor and the owner of the thing pledged,
stating the amount for which the public sale is to be held.
d. The thing pledged must be sold by the pledgee at the first auction only.

38.It refers to the right of the mortgagor to repurchase the property within a certain
period after it was sold in public auction for the payment of the secured debt.
a. Equity of redemption
b. Right of redemption
 c. Right of preemption
d. Equity of preemption

39.In case of judicial foreclosure, if upon the trial in such action the court shall find
the facts set forth in the complaint to be true, it shall ascertain the amount due
to the plaintiff upon the mortgage debt or obligation, including interest and other
charges as approved by the court, and costs, and shall render judgment for the
sum so found due and order that the same be paid to the court or to the judgment
obligee. This is known as equity of redemption of judgment debtor and the amount
shall be paid by the judgment debtor. What is the period for exercise of equity of
redemption in case of judicial foreclosure?
a. Within a period of not less than 90 days nor more than 120 days from the
entry of judgment.
b. Within a period of not less than 1 year nor more than 2 years from the entry
of judgment.
c. Within a period of not less than 90 days nor more than 1 year from the entry
of judgment.
d. Within a period of not less than 120 days nor more than 1 year days from the
entry of judgment.

40.Which of the following statements concerning formalities of real estate mortgage

is incorrect?
a. The real mortgage may be in any form to be valid since it is a consensual
contract.
b. The real mortgage must be in a public instrument for the convenience of the
parties but not for validity.
c. The real mortgage must be registered in the Registry of Property to bind third
persons.
d. The real mortgage must be in writing to be valid since it is a formal contract.

PARTNERSHIP

41.It is a contract of two or more persons who bind themselves to contribute money,
property, or industry to a common fund, with the intention of dividing the profits
among themselves. It may also be formed by two or more persons for the exercise
of a common profession.
a. Contract of Agency
b. Contract of Partnership
c. Contract of Co-ownership
d. Contract of Sale

42.Which of the following statements is true as regards to the right of industrial

partner to engage in another business?
a. An industrial partner is only prohibited to engage in a business of the same
kind but not to business of different kind.
b. An industrial partner cannot engage in any business for himself, unless the
partnership expressly permits him to do so.
c. An industrial partner may engage in business of different kind for himself,
unless the partnership expressly prohibits him to do so.
d. An industrial partner may engage in a business of the same kind for himself,
unless the partnership expressly prohibits him to do so.

43. In the absence of stipulation to the contrary, what is the obligation of the
partners as to the contribution of capital?
a. To contribute equally to the capital of the partnership.
b. To ask the court for the amount of contribution.
c. To ask third party to designate the amount of contribution.
d. To contribute in accordance with their respective age ratio.

44.The following are the rights of a partner in a partnership, except

a. To associate another person with him in his share.
b. To admit another person into the partnership without the consent of all the
partners.
 c. To have access to and inspect and copy the partnership books at reasonable
hours.
d. To have formal account of partnership affairs.

45.What is the partner’s interest in the partnership?

a. It is his share in the profits in the partnership.
b. It is his share in the surplus (net assets) of the partnership.
c. It is his share in both the profits and surplus (net assets) of the partnership.
d. It is his share in the assets of the partnership.

46.Which of the following statements concerning nominal partner and partnership by

estoppels is/are correct?
a. When a person has been thus represented to be a partner in an existing
partnership, or with one or more persons not actual partners, he is an agent
of the persons consenting to such representation to bind them to the same
extent and in the same manner as though he were a partner in fact, with
respect to persons who rely upon the representation.
b. When all the members of the existing partnership consent to the
representation, a partnership act or obligation results; but in all other cases it
is the joint act or obligation of the person acting and the persons consenting
to the representation.
c. Both A and B.
d. Neither A nor B.

47.The following are the instances when the act of a partner after dissolution does
not bind the partnership with third persons, except
a. Where the partnership is dissolved because it is unlawful to carry on the
business.
b. Where the partner acting has become insolvent.
c. Where the partner had no authority to wind up partnership affairs.
d. Where the act is necessary for winding up partnership affairs.

48.What is the minimum composition in a limited partnership?

a. At least one nominal partner and at least one general partner
b. All must be limited partners.
c. At least one limited partner and at least one general partner
d. All must be general partners.

49.What is the effect if there is no substantial compliance with the registration of

certificate of limited co-partnership with the SEC?
a. The partnership contract is null and void.
b. The limited partnership exists.
c. The partnership does not obtain juridical personality.
d. The partnership will be considered a general partnership as to third persons
but continue to be a limited partnership among the partners.

50.Who among the following may join together to establish a general professional
partnership?
a. Doctors and Engineers
b. CPAs and CPA-Lawyers
c. Architects and Nurses
d. Lawyers and CPAs

CORPORATIONS

51.Which of the following statements refers to a domestic corporation?

a. It is one incorporated under the Philippine laws.
b. It is one formed, organized or existing under any laws other than those of the
Philippines and whose laws allow Filipino citizens and Filipino corporations to
do business in its own country.
c. It is one existing both in fact and law. It is a corporation organized in
accordance with the requirements of law. Its juridical personality is not subject
to the attack by the state.
 d. It is one existing in fact but not in law. It is a corporation that is formed where
there exists a flaw in its incorporation but there is a colorable compliance with
the requirements of law. Its juridical personality is subject to direct attack only
by the state.

52.It refers to a group of persons that assumes to act as a corporation knowing it to

be without authority to do so, and enters into a transaction with a third person on
the strength of such appearance. It has no juridical personality but the persons
composing it will be liable like general partners, meaning prorata and subsidiarily,
to third persons.
a. De jure corporation
b. Corporation be prescription
c. Ostensible corporation or corporation by estoppel
d. Open corporation

53.It refers to the basic class of ordinary shares usually without extraordinary rights
and privileges, and the owners thereof are entitled to pro-rata share in the profits
of the corporation and in its asses upon dissolution and likewise in the
management of its affairs. This type of shares which has complete voting rights
is required to be present in every stock corporation.
a. Preferred shares
b. Common shares
c. Special shares
d. Privileged shares

54.Which of the following statements concerning no-par value shares is false?

a. The entire consideration received by the corporation for its no-par value shares
shall be treated as legal capital and shall not be available for distribution as
dividends.
b. The articles of incorporation must state the fact that it issued no par value
shares as well as the number of said shares.
c. Shares of capital stock issued without par value shall be deemed fully paid and
nonassessable and the holder of such shares shall not be liable to the
corporation or to its creditors in respect thereto.
d. No-par value shares can be issued by any type of corporation.

55.It refers to a stock issued that resulted to understatement of assets,

understatement of capital or overstatement of liabilities of the corporation. An
entity might issue this stock for competitive reasons, to hide from other
businesses that it is in a better financial position than appears in its financial
statements.
a. Watered stock
b. Secret reserves
c. Par value shares
d. Over-issued stocks

56.Under Revised Corporation Code, what is minimum number of Independent

Directors in corporations vested with public interest?
a. At least 20% of the directors
b. At least 10% of the directors
c. At least 25% of the directors
d. At least 1/3 of the directors

57.Under this principle, courts cannot undertake to control the discretion of the board
of directors about administrative matters as to which they have legitimate powers
of action. It also means that questions of policy or management are left solely to
the honest decision of officers and directors of a corporation and the courts are
without authority to substitute their judgment for the judgment of the board of
directors.
a. Business judgment rule or Principle of Management Prerogative
b. Doctrine of separate entity
c. Limited liability rule
d. Theory of concession
58.The following are the qualifications of a corporate president, except
a. He must be a director of the corporation.
b. He must be a stockholder of the corporation.
c. He must neither be a secretary nor a treasurer of the same corporation.
d. He must be a resident citizen of the Philippines.

59.Which of the following is disqualified from becoming a corporate treasurer?

a. Director of the corporation
b. Secretary of the corporation
c. President of the same corporation
d. Shareholder of a corporation

60.Under Revised Corporate Code, it refers to the board created by the remaining
directors who do not constitute a quorum when emergency action is required to
prevent grave, substantial, and irreparable loss or damage to the corporation.
a. Emergency board
b. Preventive board
c. Provisionary board
d. Temporary board

61.What is the maximum amount to be granted as compensation to board of directors

in such capacity?
a. 10% of the net income of corporation after tax of the current year.
b. 10% of the net income of corporation before tax of the current year.
c. 10% of the net income of corporation after tax of the immediately preceeding
year.
d. 10% of the net income of corporation before tax of the immediately preceeding
year.

62.It refers to act committed outside the object for which a corporation is created as
defined by the law of its organization and therefore beyond the express, implied
and incidental powers of the corporation.
a. Unconstitutional act
b. Immoral act
c. Ultra vires act
d. Illegal act

63.Under Revised Corporation Code, what is the basis for computation to determine
whether the sale involves all or substantially all of the corporation’s properties
and assets of the corporation?
a. It must be computed based on its net asset value, as shown in its latest
financial statements.
b. It must be computed based on its total asset value, as shown in its latest
financial statements.
c. It must be computed based on its liability value, as shown in its latest financial
statements.
d. It must be computed based on its fair market value, as shown in its latest
financial statements.

64.The following are the requisites for the validity of by-laws, except
a. It must not be contrary to the Corporation Code, any law, and Articles of
Incorporation.
b. It must not be contrary to morals and public policy.
c. It must be discriminatory, oppressive and arbitrary.
d. It must not impair obligations and contracts.

65.Mandatorily, where shall the regular and special meeting of stockholders be

located?
a. In the city/municipality where the principal office is located preferably at the
principal office of the corporation.
b. In the city/municipality where the principal warehouse is located preferably at
the principal warehouse of the corporation.
 c. In the city/municipality where the principal branch is located preferably at the
principal branch office of the corporation.
d. In the city/municipality where the largest branch is located preferably at the
largest branch of the corporation.

66.Under Revised Corporation Code, in case of postponement of stockholders’ or

members’ regular meetings, when shall written notice thereof and the reason
therefore be sent to all stockholders or members of record?
a. At least two (2) weeks prior to the date of the meeting, unless a different
period is required under the bylaws, law or regulation.
b. At least one (1) week prior to the date of the meeting, unless a different period
is required under the bylaws, law or regulation.
c. At least three (3) weeks prior to the date of the meeting, unless a different
period is required under the bylaws, law or regulation.
d. At least four (4) weeks prior to the date of the meeting, unless a different
period is required under the bylaws, law or regulation.

67.The following are the requisites for validity of proxy, except

a. It shall be valid only for the meeting which is was intended unless the proxy is
a continuing proxy.
b. It shall be in writing.
c. It shall be filed before the scheduled meeting with the corporate secretary.
d. It shall be valid and effective even for a period longer than 10 years at any
5 years
one time.

68.It refers to the agreement whereby stockholders (trustors) of a stock corporation

confers upon a trustee the right to vote and other rights pertaining to the shares
and it should not be used to circumvent the law against monopolies and illegal
combinations in restraint of trade or for fraud purposes. It may be preterminated
through a court petition by the trustors when their rights are trampled upon by
the trustee.
a. Proxy agreement
b. Agency agreement
c. Consolidation agreement
d. Voting trust agreement

69.In the absence of longer period stipulated in the contract of subscription, when
may a pre-incorporation subscription be allowed to be revoked?
a. After 6 months from date of subscription even after the submission of the
articles of incorporation with the SEC.
b. Within 6 months from date of subscription but must be before the submission
of the articles of incorporation with the SEC.
c. After 3 months from date of subscription even after the submission of the
articles of incorporation with the SEC.
d. After 6 months from date of subscription but must be before submission of the
articles of incorporation with the SEC.

70.What is the nature of a certificate of stock as an instrument?

a. It is a negotiable instrument covered by Act No. 2031 and can only be valid
transferred through negotiation.
b. It is a quasi-negotiable instrument in that sense that it may be transferred by
endorsement coupled with delivery but it is not negotiable because the holder
thereof takes it subject to personal and real defenses available to the
registered owners.
c. It is negotiable instrument and therefore the holder receives it free from
personal defenses available to the registered owners.
d. It is not negotiable and can never be transferred by assignment.

71.What is the requirement before a stock transfer agent or one engaged principally
in the business of registering transfer of stocks in behalf of a stock corporation to
operate in the Philippines?
a. There must be a license renewable annually from SEC and payment of
registration fees.
b. The agent must be a corporation.
 c. The agent must be a sole proprietor.
d. The agent must be a partnership.

COOPERATIVES
72.It is an autonomous and duly registered association of persons, with a common
bond of interest, who have voluntarily joined together to achieve their social,
economic, and cultural needs and aspirations by making equitable contributions
to the capital required, patronizing their products and services and accepting a
fair share of the risks and benefits of the undertaking in accordance with
universally accepted cooperative principles.
a. Corporation
b. Cooperative
c. Joint Venture
d. Association

73.What is the maximum foreign investment or ownership in a cooperative?

a. 100% b. 40%
c. 30% d. 0%

74.What is the composition of General Assembly of the cooperative?

a. The general assembly shall be composed of such members who are entitled to
vote under the articles of cooperation and bylaws of the cooperative.
b. The general assembly shall be composed of regular members and associate
members.
c. The general assembly shall be composed of associate members.
d. The general assembly shall be composed all members whether with voting
rights or without voting rights.

75.The cooperative has 15 sits in the board of directors. A contract with a self-dealing
director will be the subject matter of the meeting of the board of directors. In
which of the following scenarios will the contract with such self- dealing directors
be considered perfectly valid even without ratification by members?

Present directors including self- Approving present directors including

dealing director self-dealing director
a. 9 directors 5 directors
b. 8 directors 6 directors
c. 11 directors 6 directors
d. 9 directors 6 directors

76.What type of cooperative is absolutely exempted from all taxes and fees imposed
by national internal revenue taxes and other tax laws even without qualification?
a. Duly registered cooperative with CDA that does not transact business with non-
members or the general public.
b. Duly registered cooperative with CDA that transacts business with members,
non-members and the general public.
c. Duly registered cooperative with CDA with accumulated reserves and
undivided net savings of not more than P10,000,000.
d. Duly registered cooperative with CDA with accumulated reserves and
undivided net savings of more than P10,000,000.

77.In which type of taxes will a cooperative dealing with nonmembers with
accumulated reserves and undivided net savings of more than P10,000,000 be
exempted?
a. Income tax
b. Value added tax
c. Local tax and national tax on transaction with banks and insurance companies
d. All other tax unless otherwise exempted by Cooperative Code

78. n the winding up or liquidation of a cooperative, what will happen to the subsidies,
donations, legacies, grants, aids and such other assistance from any local or
foreign institution whether public or private given to such dissolved cooperative?
a. It will be given to city or municipality where the asset is located.
b. It will be given to federation or union to which the cooperative is affiliated with.
 c. It will be escheated in favor of the Republic of the Philippines.
d. It will be given to the members of the cooperative.

79.What is the required vote for division of cooperative to two or more cooperatives?
a. At least 3/4 of all the members with voting rights, present and constituting a
quorum.
b. At least 1/3 of all the members with voting rights, present and constituting a
quorum.
c. At least 2/3 of all the members with voting rights, present and constituting a
quorum.
d. At least majority of all the members with voting rights, present and
constituting a quorum.

80.What is the maximum amount of education and training fund of a cooperative?

a. Not more than 50% of net surplus
b. Not more than 10% of net surplus
c. Not more than 3% of net surplus
d. Not more than 7% of net surplus

81.Which of the following statements is false about the privileges of a cooperative?

a. Cooperatives engaged in credit services and/or federations shall be entitled to
loans credit lines, rediscounting of their loan notes, and other eligible papers
with the Bangko Sentral ng Pilipinas (BSP)
b. A public transport service cooperative may be entitled to financing support for
the acquisition and/or maintenance of land and sea transport equipment,
facilities and parts through the program of the government financial
institutions. It shall have the preferential right to the management and
operation of public terminals and ports whether land or sea transport where
the cooperative operates and on securing a franchise for active or potential
routes for the public transport.
c. Cooperatives organized by faculty members and employees of educational
institutions shall have the preferential right in the management of the canteen
and other services related to the operation of the educational institution where
they are employed: Provided, That such services are operated within the
premises of the said educational institution
d. The appropriate housing agencies and government financial institutions shall
create a special window for financing housing projects undertaken by
cooperatives, with interest rates and terms equal to, or better than those given
for socialized housing projects. This financing shall be in the form of blanket
loans or long-term wholesale loans to qualified cooperatives, without need for
individual processing.

NEGOTIABLE INSTRUMENTS

82.Where the instrument is so ambiguous that there is doubt on whether it is a bill

or a note, the holder may treat it as either at his option. The following are the
instances when a bill of exchange may be treated as a promissory note by the
holder, except
a. Where the drawer and drawee are the same person.
b. Where the drawee is a fictitious person.
c. Where the drawee is a person not having a capacity to contract.
d. Where the drawer is a corporation

83.The following are the essential requisites of a negotiable promissory note, except
a. It must be in writing and signed by the maker.
b. It must contain an unconditional promise to pay a sum certain in money.
c. It must be payable on demand, or at a fixed time or at a determinable future
time.
d. It must specify the place where the payment shall be made.

84.This stage in the life of negotiable instrument refers to the first delivery of the
instrument complete in form to a person who takes it as a holder.
a. Issuance
b. Negotiation
 c. Discharge
d. Assignment

85.The following are the formalities required by law for acceptance for honor, except
a. An acceptance for honor supra protest must be in writing.
b. It must indicate that it is an acceptance for honor.
c. It must be signed by the acceptor for honor.
d. The acceptance for honor must be the whole sum or amount stated in the bill.

86.What is the prima facie presumption of law regarding the time of indorsement
where an instrument does not bear date after the maturity of the instrument?
a. Every negotiation is deemed prima facie to have been effected before the
instrument was overdue.
b. Every negotiation is deemed prima facie to have been effected after the
instrument was overdue.
c. Every negotiation is deemed prima facie to have been effected at maturity
date.
d. None of the above.

87.It must be given to the drawer and to each indorser in order to charge these
persons who are secondarily liable to the instrument.
a. Notice of dishonor
b. Protest
c. Petition
d. Subpoena

88.The following are the effects of the payment for honor by third person, except
a. All parties subsequent to the party for whose honor it is paid are discharged.
b. All parties prior to the party for whose honor it is paid are discharged.
c. The payer for honor is subrogated for, and succeeds to, both the rights and
duties of the holder as regards the party for whose honor he pays and all
parties liable to the latter.
d. The party for whose honor the payer pays and all prior parties to the former
are liable to the payer for honor.

89.Which of the following defenses may be set up against any holder?

a. Absence of delivery of complete instrument
b. Filling of black or contrary to authority given
c. Illegality of consideration
d. Fraud in esse contractus

90.May a holder not in due course enforce the instrument against a party prior to a
holder in due course even if there is personal defense present?
a. No in all instances.
b. Yes in all instances.
c. Yes if he derives his title through a holder in due course provided he is not a
party to any fraud or illegality affecting the instrument also known as shelter
rule.
d. Yes if he derives his title through a holder in due course even if he is a party
to any fraud or illegality affecting the instrument.

91.A person negotiating the instrument by mere delivery is not secondarily liable to
the instrument because he does not guarantee the solvency of the person
primarily liable. The following are the warranties of a person negotiating the
negotiable instrument by mere delivery but his warranties extend in favor of no
holder other than the immediate transferee, except
a. That the instrument is genuine and in all respects what it purports to be.
b. That he has good title to it.
c. That he has no knowledge of any fact which would impair the validity of the
instrument or render it valueless.
d. That the instrument, is at the time of his indorsement, is valid and subsisting.
BOUNCING CHECKS
92.What law punishes or penalizes issuance of worthless checks?
a. BP 22
b. BP 68
c. BP 45
d. BP 13

93.Which of the following is punishable act under BP 22 also known as Bouncing

Checks Law?
a. Any person who (a) makes or draws and issues any check to apply on account
or for value, (b) knowing at the time of issue that he does not have sufficient
funds in or credit with the drawee bank for the payment of such check in full
upon its presentment, (c) which check is subsequently dishonored by the
drawee bank for insufficiency of funds or credit or would have been dishonored
for the same reason had not the drawer, without any valid reason, ordered the
bank to stop payment.
b. Any person who, having sufficient funds in or credit with the drawee bank when
he makes or draws and issues a check, shall fail to keep sufficient funds or to
maintain a credit to cover the full amount of the check if presented within a
period of ninety (90) days from the date appearing thereon, for which reason
it is dishonored by the drawee bank.
c. Either A or B
d. Both A and B

94.Which of the following is not an element of violation of BP 22 for issuance of

worthless check or no sufficient fund (NSF) check?
a. There must be making, drawing, and issuance of any check to apply for account
or for value.
b. There must be knowledge of the maker, drawer, or issuer that at the time of
issue he does not have sufficient funds in or credit with the drawee bank for
the payment of the check in full upon its presentment.
c. There must be subsequent dishonor of the check by the drawee bank for
insufficiency of funds or creditor dishonor for the same reason had not the
drawer, without any valid cause, ordered the bank to stop payment.
d. There must be criminal intent to defraud on the part of the drawer of the check.

95.Which of the following is not a duty of a drawee bank under BP 22?

a. When refusing to pay the check to the holder thereof upon presentment, to
cause to be written, printed, or stamped in plain language thereon, or attached
thereto, the reason for drawee's dishonor or refusal to pay the same.
b. If there are no sufficient funds in or credit with such a drawee bank regarding
such check, such fact shall always be explicitly stated in the notice of dishonor
or refusal to be given by the drawee bank.
c. Notwithstanding receipt of an order to stop payment from the drawer of check,
the drawee bank shall state in the notice that there were no sufficient funds in
or credit with such bank for the payment in full of such check, if such be the
fact.
d. The drawee bank should report the act of issuance of worthless check to AMLC
even if the amount does not exceed the quantitative threshold to be considered
covered transaction.

96.What is the quantum of evidence required to sue or file a criminal case for criminal
offense involving violation of BP 22 for issuance of worthless checks?
a. Probable cause or prima facie evidence
b. Clear and convincing evidence
c. Preponderance of evidence
d. Proof beyond reasonable doubt

97.The introduction in evidence of any unpaid and dishonored check, having the
drawee's refusal to pay stamped or written thereon or attached thereto, with the
reason therefor as aforesaid, shall be prima facie evidence of the following
elements of crime of issuance of worthless checks, except
a. The making or issuance of said check.
 b. The due presentment to the drawee bank of the check for payment and the
dishonor thereof.
c. The check same was properly dishonored for the reason written, stamped or
attached by the drawee on such dishonored check.
d. The knowledge of the maker or drawer of the insufficiency of fund or credit of
the check he issued.

98.What is the legal obligation on the part of the drawer of a funded check in order
to exempt himself from criminal liability for bouncing check?
a. He must keep sufficient fund or maintain credit to cover the full amount of the
check within a period of 90 days from the maturity date of the check.
b. He must keep sufficient fund or maintain credit to cover the full amount of the
check within a period of 30 days from the maturity date of the check.
c. He must keep sufficient fund or maintain credit to cover the full amount of the
check within a period of 60 days from the maturity date of the check.
d. He must keep sufficient fund or maintain credit to cover the full amount of the
check within a period of 120 days from the maturity date of the check.

PDIC
99.What is the government instrumentality created in 1963 by virtue of Republic Act
3591 to insure the deposits of all banks which are entitled to the benefits of
insurance and considered as an an attached agency of the Department of Finance?
a. Development Bank of the Philippines (DBP)
b. Landbank of the Philippines (LBP)
c. Philippine Deposit Insurance Corporation (PDIC)
d. Bangko Sentral ng Pilipinas (BSP)

100. Which of the following deposits is not insured by PDIC?

a. Savings Deposit in Metrobank Manila Branch
b. Certificate of Time Deposit in Philippine National Bank Makati Branch
c. Bank Deposit in Japan Bank Tokyo Branch
d. Special Savings in Bank of Philippine Islands Taguig Branch

101. In case of joint account between a juridical person and a natural person, who
shall be entitled to the maximum insured deposit of P500,000 in such joint
account?
a. Juridical person
b. Natural person
c. Both juridical person and natural person equally
d. Neither juridical person nor natural person

102. What is the effect of payment by PDIC of insured deposits to depositors?

a. PDIC may recover from the assets of the closed in so far as the payment made
by PDIC is beneficial to depositors.
b. PDIC shall be legally subrogated to all rights of depositor against the closed
bank to the extent of such payment.
c. PDIC may not recover from the assets of the closed bank if the payment is
without the knowledge or against the will of the closed bank.
d. PDIC may only recover from the assets of the closed bank if the payment is
with the consent of the closed bank.

103. They refer to money or funds placed with a bank that can be withdrawn on the
depositor’s order or demand.
a. Deposits
b. Trust funds
c. Money market placements
d. Deposit substitutes

104. Under Republic Act No. 1405, what is the nature of bank deposit and
investment in government bonds?
a. As a general rule, they are absolutely confidential in nature.
b. As a general rule, they are generally subject to any type of inspection.
c. They are exempted from any type of inquiry.
d. None of the above.
105. What is the mode of payment by PDIC of claims of depositors from a closed
bank?
a. By cash
b. By making available to each depositor a transferred deposit in another insured
bank in an amount equal to insured deposit of such depositor.
c. By checks, promissory note or bill of exchange
d. Either A or B

BANK SECRECY
106. Which of the following inquiries will be considered a violation of Philippine Peso
deposit secrecy law?
a. Periodic inquiry or special examination of bank deposits by BSP to ensure
compliance with the Anti-Money Laundering Law.
b. Inquiry of bank deposits by BIR Commissioner in relation to an application for
compromise of taxable liability or determination of a decedent’s gross estate
under National Internal Revenue Code.
c. Inquiry of bank deposits by PDIC when there is finding of unsafe or unsound
banking practices.
d. Inquiry of bank deposits by DOJ Secretary for the purpose of persecution of
the members of the opposing political party.

107. Which of the following disclosures will be considered a violation of Philippine

peso deposit secrecy law?
a. Reporting of unclaimed balances of a bank deposit to the Treasurer of the
Philippines or Bureau of Treasury by authorized bank officials.
b. Using of insider information about the bank deposits by bank employees in
order to determine the credit rating or credit standing of their depositors for
purposes of offering credit cards.
c. Turn-over by authorized bank officials to the BIR Commissioner of the amount
in bank accounts as may be sufficient to satisfy the writ of garnishment issued
to collect delinquent taxes.
d. Disclosure by a bank officer or employee upon order of a competent court in
connection with a deposit in a closed bank that was used in the perpetration
of anomalies.

108. A government employee purchased DBP Bonds with a total value of P100,000
and receives annual interest income from his investment. Under Bank Secrecy
Law, the investment of the government employee may be inquired into even
without need of a court order by the
a. Public prosecutor handling estafa case against the government employee
b. BIR officer auditing the VAT of the government employee
c. Credit investigator of a lending institution where the government employee
applied for the loan
d. None of the foregoing

109. Which act is covered by Domestic Bank Deposit Secrecy Law a.k.a. R.A. No.
1405?
a. Disclosing the amount of deposit of a judgment debtor to the court sheriff who
is executing a garnishment order against him.
b. Disclosing the name of the drawer of a check to the payee.
c. Disclosing the amount of deposit of a taxpayer to a duly authorized BIR
examiner who is examining his income tax liability.
d. Disclosing the amount of deposit exceeding P500,000 in one banking day to
Anti-Money Laundering Council.

110. The following are the exceptional cases when the BIR Commissioner may
inspect bank deposits, except
a. When there is application of compromise liability by a taxpayer on the ground
of financial incapacity.
b. To determine the gross estate for computation of estate tax’s liability.
c. When a request for tax information of specific18 taxpayers made by a foreign
tax authority pursuant to a tax treaty under The Exchange of Information on
Tax Matters Act of 2009.
d. To determine the taxable income of politicians.
111. Under Republic Act No. 1405 a.k.a. Philippine Peso Deposit Secrecy Law, the
bank deposits and investment in government bonds may be inquired into in the
following exceptional instances, except
a. Upon written permission or consent in writing by the depositor.
b. In cases of impeachment of the President, Vice President, members of the
Supreme Court, members of the Constitutional Commission (Commission on
Elections, Civil Service Commission and Commission on Audit) and the
Ombudsman for culpable violation of the Constitution, treason, bribery, graft
and corruption, other high crimes or betrayal of public trust. (Art. XI, Sec. 2,
1987 Philippine Constitution)
c. Upon order of a competent court in cases of bribery or dereliction of duty of
public officials.
d. In cases of tax evasion cases filed by BIR Commissioner against a taxpayer.

112. What is the penalty provided by law for violation of RA 1405 a.k.a. Philippine
Peso deposit secrecy law?
a. Imprisonment of not more than five years or fine of not more than P20,000 or
both imprisonment and fine.
b. Imprisonment of not more than ten years or fine of not more than P200,000
or both imprisonment and fine.
c. Imprisonment of not more than twenty years or fine of not more than
P2,000,000 or both imprisonment and fine.
d. Imprisonment of not more than one year or fine of not more than P2,000 or
both imprisonment and fine.

AMLA
113. Which of the following is not considered offense punishable as money
laundering?
a. Transacting known proceeds of any unlawful activity.
b. Converting, transferring, disposing of, acquiring, possessing, moving, or using
known proceeds of any unlawful activity.
c. Concealing, disguising the true nature, source, location, movement, or
ownership of known proceeds of any unlawful activity.
d. Mere knowledge of proceeds of any unlawful activity.

114. Which of the following is not a predicate crime of Money Laundering Offense?
a. Swindling
b. Adultery
c. Fencing
d. Illegal recruitment

115. Which of the following is not a predicate crime of Money Laundering Offense?
a. Voyeurism
b. Extortion
c. Smuggling
d. Homicide

116. Which of the following is a predicate crime of Money Laundering Offense?

a. Violation of BP 22 a.k.a. Bouncing Check Law
b. Violation of BP 68 a.k.a. Corporation Code of the Philippines
c. Violation of Electronic Commerce Act of 2000 a.k.a. RA No. 8792
d. Violation of Data Privacy Act

117. It refers to a type of transaction that shall be reported by a covered person to

the Anti-Money Laundering Council because the transaction breaches the
quantitative threshold for reporting purposes.
a. Covered transaction
b. Suspicious transaction
c. Reportable transaction
d. Exempted transaction
118. It refers to a type of transaction that shall still be reported by a covered person
to the Anti-Money Laundering Council even if the transaction does not breach the
quantitative threshold for reporting purposes by reason of the unusual nature of
the transaction.
a. Covered transaction
b. Suspicious transaction
c. Reportable transaction
d. Exempted transaction

119. Which of the following is not a covered person and therefore is not required to
report covered transaction or suspicious transaction to Anti-Money Laundering
Council?
a. Insurance companies or pre-need companies
b. Insurance agents, brokers, or professional reinsurers
c. Holding company, holding company system or mutual benefit association
d. Convenience stores, grocery stores or supermarkets

INTELLECTUAL PROPERTY
120. It refers to a protection option, which is designed to protect innovations that
are not sufficiently inventive to meet the inventive threshold required for standard
patents application. It may be any useful machine, implement, tools, product,
composition, process, improvement or part of the same, that is of practical utility,
novelty and industrial applicability.
a. Utility model
b. Patent
c. Industrial design
d. Trademark

121. It refers to any composition of lines or colors or any three-dimensional form,

whether or not associated with lines or colors; provided that such composition or
form gives a special appearance to and can serve as pattern for an industrial
product or handicraft. Simply put, it is that aspect of a useful article which is
ornamental or aesthetic.
a. Utility model
b. Patent
c. Industrial design
d. Trademark

122. Which of the following may become the subject matter of patent application?
a. Discoveries, scientific theories and mathematical methods
b. Schemes, rules and methods of performing mental acts, playing games or
doing business, and programs for computers
c. Methods for treatment of the human or animal body by surgery or therapy and
diagnostic methods practiced on the human or animal body
d. Microorganisms, non-biological process and microbiological process

123. If two or more persons have made an invention separately and independently
of each other, who shall own the right to the patent where two or more
applications for registration are filed for the same invention?
a. The applicant who has the earliest filing date or, the earliest priority date.
b. The applicant who has the latest filing date or, the latest priority date.
c. The first person who invented the technology.
d. The first person who presented the technology to a convention.

124. This test of patent infringement means that infringement also takes place when
a device appropriates a prior invention by incorporating its innovative concept
and, although with some modification and change, performs substantially the
same function in substantially the same way to achieve substantially the same
result.
a. Literal infringement test
b. Doctrine of equivalents infringement test
c. Dominancy test
d. Holistic test
125. t is an intellectual property that refers to any visible sign designated as such
in the application for registration and capable of distinguishing the origin or any
other common characteristic, including the quality of goods or services of different
enterprises which use the sign under the control of the registered owner of the
collective mark.
a. Distinguishing mark
b. Collective mark
c. Patent
d. Copyright

126. Which of the following marks may be registered before Intellectual Property
Office for protection?
a. Marks consisting of immoral, deceptive or scandalous matter, or matter which
may disparage or falsely suggest a connection with persons, living or dead,
institutions, beliefs, or national symbols, or bring them into contempt or
disrepute.
b. Marks which are unlikely to mislead the public, particularly as to the nature,
quality, characteristics or geographical origin of the goods or service.
c. Marks consisting of the flag or coat of arms or other insignia of the Philippines
or any of its political subdivisions, or of any foreign nation, or any simulation
thereof.
d. Marks identical to a registered mark belonging to a different proprietor or a
mark with an earlier filing or priority date.

DATA PRIVACY

127. It refers to a government agency which is considered an independent body

entrusted to administer and implement the provisions of Data Privacy Act, and to
monitor and ensure compliance of the country with international standards set for
data protection.
a. National Telecommunication Commission
b. National Privacy Commission
c. National Economic Commission
d. National Power Corporation

128. It refers to a system for generating, sending, receiving, storing or otherwise

processing electronic data messages or electronic documents and includes the
computer system or other similar device by or which data is recorded, transmitted
or stored and any procedure related to the recording, transmission or storage of
electronic data, electronic message, or electronic document.
a. Information and communication system
b. Database system
c. Transportation system
d. Connectivity system

129. He or it refers to a person or organization who controls the collection, holding,

processing or use of personal information, including a person or organization who
instructs another person or organization to collect, hold, process, use, transfer or
disclose personal information on his or her behalf.
a. Personal information processor
b. Personal information controller
c. Personal information holder
d. Personal information collector

130. Which of the following is not considered a sensitive personal information?

a. Information about an individual’s health, education, genetic or sexual life of a
person, or to any proceeding for any offense committed or alleged to have
been committed by such person, the disposal of such proceedings, or the
sentence of any court in such proceedings.
b. Information issued by government agencies peculiar to an individual which
includes, but not limited to, social security numbers, previous or current health
records, licenses or its denials, suspension or revocation, and tax returns.
c. Information specifically established by an executive order or an act of Congress
to be kept classified.
 d. Information about the platform of a candidate for national elective position
that is discussed in a public debate televised in national television network.

131. Who shall assist the Privacy Commissioner of National Privacy Commission?
a. Two Deputy Privacy Commissioner, one to be responsible for Data Processing
Systems and to be responsible for Policies and Planning
b. Two Assistant Privacy Commissioner, one to be responsible for Data Processing
Systems and to be responsible for Policies and Planning
c. Two Vice Privacy Commissioner, one to be responsible for Data Processing
Systems and to be responsible for Policies and Planning
d. Two Under Privacy Commissioner, one to be responsible for Data Processing
Systems and to be responsible for Policies and Planning

132. Which of the following is not a qualification of Privacy Commissioner?

a. He must be at least 35 years of age.
b. He must be of good moral character, unquestionable integrity and known
probity.
c. He must be a recognized expert in the field of information technology and data
privacy.
d. He must be a holder of Doctor of Philosophy (PhD) in the field of information
technology and data privacy.

133. Which of the following is not a right of Data Subject under Data Privacy Act?
a. Right to be informed whether personal information pertaining to him or her
shall be, are being or have been processed.
b. Right to be furnished the information indicated hereunder before the entry of
his or her personal information into the processing system of the personal
information controller, or at the next practical opportunity.
c. Right to have reasonable access to, upon demand, the information being
processed by the data controller.
d. Right to question the decision made by the data controller regarding act of
management or act of administration of the corporation.

ELECTRONIC COMMERCE
134. He refers to the person who is intended by the originator to receive the
electronic data message or electronic document.
a. Addressee
b. Recipient
c. Drawee
d. Offeree

135. It refers to information generated, sent, received or stored by electronic,

optical or similar means.
a. Mechanical data message
b. Electronic data message
c. Computerized data message
d. Binary data message

136. It refers to any distinctive mark, characteristic and/or sound in electronic form,
representing the identity of a person and attached to or logically associated with
the electronic data message or electronic document or any methodology or
procedures employed or adopted by a person and executed or adopted by such
person with the intention of authenticating or approving an electronic data
message or electronic document.
a. Benchmark
b. Trademark
c. Electronic signature
d. Identification mark
137. It refers to a system intended for and capable of generating, sending,
receiving, storing, or otherwise processing electronic data messages or electronic
documents and includes the computer system or other similar device by or in
which data is recorded or stored and any procedures related to the recording or
storage of electronic data message or electronic document.
a. Accounting information system
b. Database system
c. Information and communication system
d. Internal control system

138. It refers to information or the representation of information, data, figures,

symbols or other modes of written expression, described or however represented,
by which a right is established or an obligation extinguished, or by which a fact
may be prove and affirmed, which is receive, recorded, transmitted, stored,
processed, retrieved or produced electronically.
a. Electronic document
b. Paper document
c. Manual document
d. Computerized document

139. It refers to a secret code which secures and defends sensitive information that
cross over public channels into a form decipherable only with a matching
electronic key.
a. Digital signature
b. Electronic key
c. Password
d. Manual key

140. He refers to a person by whom, or on whose behalf, the electronic document

purports to have been created, generated and/or sent.
a. Offeror
b. Sender
c. Originator
d. Creator

EASE OF DOING BUSINESS LAW

141. Which of the following is not covered by Ease of Doing Business and Efficient
Government Service Delivery Act of 2018?
a. Local government units (LGUs)
b. Government owned and controlled corporations (GOCCs)
c. Government instrumentalities located abroad
d. None of the above

142. Which is false regarding Anti-Red Tape Act/ Ease of doing Business Law?
a. All government agencies including departments, bureaus, offices,
instrumentalities, or government-owned and/or -controlled corporations, or
local LGUs shall set up their respective most current and updated service
standards to be known as the Citizen's Charter in the form of information
billboards which shall be posted at the main entrance of offices or at the most
conspicuous place, in their respective websites and in the form of published
materials written either in English, Filipino, or in the local dialect.
b. Except during the preliminary assessment of the request and evaluation of
sufficiency of submitted requirements, no government officer or employee
shall have any contact, in any manner, unless strictly necessary with any
requesting party concerning an application or request. This principle is known
as zero-contract policy.
c. If the granting authority in the government fails to approve or disapprove an
application for a license, clearance, permit, certification or authorization within
the prescribed processing time under Ease of Doing Business Law, said
application shall be deemed approved.
d. To eliminate bureaucratic red tape, avert graft and corrupt practices and to
promote transparency and sustain ease of doing business, the DOST shall be
primarily responsible in establishing, operating and maintaining a Central
Business Portal or other similar technology, as the DOST may prescribe.
143. It refers to single common site or location, or a single online website or portal
designated for the Business Permits and Licensing System (BPLS) of an LGU to
receive and process applications, receive payments, and issue approved licenses,
clearances, permits, or authorizations.
a. Business One Stop Shop (BOSS)
b. Business Only Scope Store (BOSS)
c. Business On Site Scheme (BOSS)
d. Business Own Set Style (BOSS)

144. They refer to applications or requests submitted by applicants or requesting

parties of a government office which necessitate evaluation in the resolution of
complicated issues by an officer or employee of said government office, such
transactions to be determined by the office concerned.
a. Simple transactions
b. Compound transactions
c. Complex transactions
d. Composite transactions

145. It refers to an application which requires the use of technical knowledge,

specialized skills and/or training in the processing and/or evaluation thereof.
a. Simple application
b. Compound application
c. Highly technical application
d. Common application

146. They refers to applications or requests submitted by applicants or requesting

parties of a government office or agency which only require ministerial actions on
the part of the public officer or employee, or that which present only
inconsequential issues for the resolution by an officer or employee of said
government office.
a. Simple transactions
b. Common transactions
c. Ordinary transactions
d. Normal transactions

147. This is a policy that prohibits government officer or employee to have any
contact with an application except (1) during the preliminary assessment of the
request and evaluation of sufficiency of submitted requirements and (2) necessary
with any requesting party concerning an application or request.
a. Zero-Contact Policy
b. Online Policy
c. Invisible Policy
d. Intangible Policy

148. What is the maximum period for the processing and approval of licenses,
clearances, permits, certifications or authorizations for the installation and
operation of telecommunication, broadcast towers, facilities, equipment and
services in so far as those issued by National Government Agencies (NGAs)?
a. a total of seven (7) working days
b. a total of five (5) working days
c. a total of three (3) working days
d. a total of ten (10) working days

CODE OF CORPORATE GOVERNANCE

149. It refers to the framework of rules, systems and processes in the corporation
that governs the performance by the Board of Directors and Management of their
respective duties and responsibilities to the stockholders.
a. Corporate governance
b. Corporate by-laws
c. Articles of incorporation
d. Corporate regulation
150. Which of the following companies is not covered by the Revised Code of
Corporate Governance?
a. Corporation that is a grantee of secondary licenses from SEC
b. Small and Medium Enterprise
c. c. Corporation that sells equity and/or debt securities to the public that are
required to be registered with the SEC
d. d. Corporation that has assets in excess of Fifty Million Pesos and at least two
hundred (200) stockholders who own at least one hundred (100) shares each
of equity securities

151. How many independent directors must be present in a corporation covered by

Revised Code of Corporate Governance?
a. One independent director
b. Two independent directors
c. Three independent directors
d. Four independent directors

152. Which of the following is a ground for temporary disqualification of a director

under the Revised Code of Corporate Governance?
a. Absence for any twelve (12) month period during his incumbency
b. Any person judicially declared as insolvent
c. Any person convicted by final judgment or order by a court or competent
administrative body of an offense involving moral turpitude, fraud,
embezzlement, theft, estafa, counterfeiting, misappropriation, forgery,
bribery, false affirmation, perjury or other fraudulent acts
d. Any person found guilty by final judgment or order of a foreign court or
equivalent financial regulatory authority of fraudulent acts

153. What is the minimum composition of audit committee of a corporation?

a. At least three directors who shall preferably have accounting and finance
backgrounds, one of whom shall be an independent director and another with
audit experience.
b. At least five directors who shall preferably have accounting and finance
backgrounds, one of whom shall be an independent director and another with
audit experience.
c. At least four directors who shall preferably have accounting and finance
backgrounds, one of whom shall be an independent director and another with
audit experience.
d. At least seven directors who shall preferably have accounting and finance
backgrounds, one of whom shall be an independent director and another with
audit experience.

154. To whom shall the compliance officer report directly?

a. President of the corporation
b. Chairman of the board of directors
c. Independent director
d. Chairman of the audit committee

155. What is the period for submission or filing to SEC of audited financial
statements of a corporation whose fiscal year ends on a date other than December
31?
a. Within 120 calendar days from the end of fiscal year
b. Within 120 working days from the end of fiscal year
c. Within 90 calendar days from the end of fiscal year
d. Within 90 working days from the end of fiscal year
SECURITIES REGULATION CODE

156. Which of the following is not considered a security under Securities Regulation
Code?
a. Shares of stocks, bonds, debentures, notes evidences of indebtedness, asset-
backed securities
b. Investment contracts, certificates of interest or participation in a profit sharing
agreement, certifies of deposit for a future subscription
c. Fractional undivided interests in oil, gas or other mineral rights
d. Deed of Lease or Deed of Sale

157. He refers to any person who acts as intermediary in making deliveries upon
payment effect settlement in securities transactions.
a. Exchange
b. Clearing agency
c. Market
d. Auction

158. They refer to contracts which provide for the performance of future services of
or the payment of future monetary considerations at the time actual need, for
which plan holders pay in cash or installment at stated prices, with or without
interest or insurance coverage and includes life, pension, education, interment,
and other plans which the Commission may from time to time approve
a. Insurance policies
b. Investment schemes
c. Pre-need plans
d. Money market placements

159. It refers to the application for the registration of securities required to be filed
with the Securities and Exchange Commission before these securities be allowed
to be sold or offered for sale or distributed within the Philippines.
a. Certificate of registration
b. Application form
c. Registration statement
d. Articles of registration

160. Which of the following securities is exempted from registration before

Securities and Exchange Commission?
a. Participation in profit sharing agreement in a partnership
b. Investment contracts issued by a networking company
c. Trust certificates and voting trust certificates in a mining company
d. Certificate of time deposit or money market placement issued by a bank

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