100+ Free IICA Independent Director Practice Questions

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2026 Statistics

Key Facts: IICA Independent Director Exam

50 MCQs / 75 min

Exam size and duration

IICA Independent Directors Databank

50%

Minimum passing score

IICA Independent Directors Databank

None

Negative marking

IICA Independent Directors Databank

2 Years

Time allowed to pass after registration

IICA Independent Directors Databank

100

Free practice questions here

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IICA Independent Director Test: 50 MCQs / 100 marks / 75 minutes online; no negative marking; passing score is 50%. Fee included in databank subscription (₹5,000+ for 1 year). Mandatory within 2 years of databank registration (unless exempt).

Sample IICA Independent Director Practice Questions

Try these sample questions to test your IICA Independent Director exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1Under Section 149(4) of the Companies Act, 2013, every listed public company is required to have at least what proportion of its total number of directors as independent directors?

A.At least one-half

B.At least one-third

C.At least two-thirds

D.At least one-fourth

Explanation: Section 149(4) of the Companies Act, 2013 mandates that every listed public company must have at least one-third of its total number of directors as independent directors. Any fraction in this calculation is rounded off as one.

2Which Schedule of the Companies Act, 2013 prescribes the 'Code for Independent Directors' in India?

A.Schedule II

B.Schedule III

C.Schedule IV

D.Schedule V

Explanation: Schedule IV of the Companies Act, 2013 establishes the professional conduct guidelines, roles, functions, duties, and appointment procedures for independent directors under the Code for Independent Directors.

3Under Section 177 of the Companies Act, 2013, what proportion of the Audit Committee members must be independent directors?

A.All members

B.A majority of the members

C.At least one-third

D.At least two-thirds

Explanation: Section 177(2) of the Companies Act, 2013 specifies that the Audit Committee shall consist of a minimum of three directors with independent directors forming a majority.

4Which financial statement ratio is calculated by dividing current assets by current liabilities?

A.Quick Ratio

B.Current Ratio

C.Debt-to-Equity Ratio

D.Interest Coverage Ratio

Explanation: The Current Ratio is a standard liquidity ratio calculated as Current Assets divided by Current Liabilities. It evaluates a company's ability to cover short-term obligations due within one year.

5Under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, what is the maximum number of listed entities in which a person can serve as an independent director?

A.Five

B.Seven

C.Ten

D.Twelve

Explanation: Under Regulation 17A of SEBI LODR, a person shall not serve as an independent director in more than seven listed entities. If the person is serving as a whole-time director in any listed entity, they can serve as an independent director in a maximum of three listed entities.

6Section 149(12) of the Companies Act, 2013 provides a safe harbor for independent directors, stating they can only be held liable for acts of omission or commission that occurred with their:

A.Implicit presence during the board meeting

B.Knowledge, attributable through board processes, and with their consent or connivance, or where they failed to act diligently

C.Signature on any official contract executed by the management

D.Knowledge of any general business transaction carried out by key managerial personnel

Explanation: Under Section 149(12), an independent director is only liable in respect of such acts of omission or commission by a company which had occurred with their knowledge, attributable through Board processes, and with their consent or connivance or where they had not acted diligently.

7Who is responsible for appointing the chairperson of the Audit Committee in a listed company in India?

A.The Managing Director of the company

B.The Board of Directors

C.The Nomination and Remuneration Committee

D.The members of the Audit Committee themselves

Explanation: The Board of Directors appoints the members of the Audit Committee and designates one of the independent directors as its chairperson, in accordance with the Companies Act, 2013 and SEBI LODR.

8Under the Companies Act, 2013, what is the maximum tenure for which an independent director can be appointed in a single term?

A.Three consecutive years

B.Five consecutive years

C.Ten consecutive years

D.Two consecutive years

Explanation: Section 149(10) of the Companies Act, 2013 states that an independent director shall hold office for a term up to five consecutive years on the Board of a company, and is eligible for reappointment on passing of a special resolution.

9What type of resolution is required for the reappointment of an independent director for a second consecutive term of five years?

A.Ordinary Resolution

B.Special Resolution

C.Board Resolution with unanimous consent

D.No resolution is required; it is auto-renewed

Explanation: Section 149(10) of the Companies Act, 2013 dictates that an independent director can be reappointed for a second consecutive term only on the passing of a special resolution by the company's shareholders.

10Under SEBI (Prohibition of Insider Trading) Regulations, 2015, what does 'UPSI' stand for?

A.Unified Price Sensitive Information

B.Unpublished Price Sensitive Information

C.Unsecured Private Shareholder Index

D.Unapproved Public Share Issue

Explanation: UPSI stands for Unpublished Price Sensitive Information, which refers to any information relating to a company or its securities that is not generally available and which, upon becoming available, is likely to materially affect the price of the securities.

About the IICA Independent Director Exam

The Independent Director Online Proficiency Self-Assessment Test is a mandatory evaluation conducted by the IICA under the Ministry of Corporate Affairs, India. It tests board aspirants on companies act provisions, corporate governance, financial literacy, and SEBI regulations to qualify for inclusion in the databank.

Assessment

Online computer-based test (CBT) consisting of 50 MCQs. No negative marking. Passing score is 50%. Candidates have unlimited attempts, subject to subscription status.

Time Limit

75 minutes

Passing Score

50% (50 marks out of 100)

Exam Fee

Included in Databank subscription (₹5,000 + 18% GST for 1 year, ₹15,000 + 18% GST for 5 years, or ₹25,000 + 18% GST for lifetime) (Indian Institute of Corporate Affairs (IICA))

IICA Independent Director Exam Content Outline

30%

Companies Act, 2013

Rules on directors' duties, board meetings, committees, auditing, and compliance management

30%

Corporate Governance & Board Effectiveness

Ethics, evaluation of board members, duties to minority stakeholders, and corporate social responsibility (CSR)

20%

Financial Literacy & Accountancy

Financial statements analysis, balance sheet concepts, cash flow, profit & loss, and audit reports

20%

Securities Law & SEBI Regulations

SEBI LODR, prevention of insider trading, and listing compliance requirements for Indian companies

How to Pass the IICA Independent Director Exam

What You Need to Know

Passing score: 50% (50 marks out of 100)
Assessment: Online computer-based test (CBT) consisting of 50 MCQs. No negative marking. Passing score is 50%. Candidates have unlimited attempts, subject to subscription status.
Time limit: 75 minutes
Exam fee: Included in Databank subscription (₹5,000 + 18% GST for 1 year, ₹15,000 + 18% GST for 5 years, or ₹25,000 + 18% GST for lifetime)

Keys to Passing

Complete 500+ practice questions
Score 80%+ consistently before scheduling
Focus on highest-weighted sections
Use our AI tutor for tough concepts

IICA Independent Director Study Tips from Top Performers

1Thoroughly review Chapter XI of the Companies Act, 2013, focusing on directors' appointment, qualification, and duties.

2Understand standard financial statements and key financial ratios such as debt-to-equity, current ratio, and return on equity.

3Study SEBI Listing Obligations and Disclosure Requirements (LODR) regulations, particularly board composition and committee mandates.

4Go through the official e-learning modules and mock tests offered on the Independent Directors Databank portal.

Frequently Asked Questions

Who must take the IICA Independent Director Test?

Any individual registered with the Independent Directors Databank of India must pass this test within two years of inclusion in the databank, unless they meet the criteria for exemption based on past board experience.

What is the qualifying score and pattern of the test?

The test contains 50 MCQs to be answered in 75 minutes. The total score is 100 marks, and the minimum qualifying mark is 50%. There is no negative marking for incorrect answers.

How many times can I attempt the self-assessment test?

There is no limit on the number of attempts allowed to pass the proficiency test, provided your subscription to the Independent Directors Databank remains active.