Committee of inspection can be set up by?

• A. Court order
• B. SFC directive
• C. Voluntary liquidation by creditors
• D. Shareholders meeting

Answer: (C)

A committee of inspection is formed to supervise and oversee the liquidation when the process is handled voluntarily by creditors. In a creditors’ voluntary winding up, the creditors come together, appoint the liquidator, and may also appoint a committee of inspection to supervise the liquidator’s actions and protect the creditors’ interests. This kind of supervisory body is not set up by a court, nor by a shareholders’ meeting, and it isn’t something created on a regulator’s directive. So the option reflecting voluntary liquidation by creditors is the correct context for establishing a committee of inspection.