Chapter 1 "Company Introduction, types and registration" Flashcards
What is company?
Company means an organization which is registered under company law.
What is Company Law?
Company law includes: •Repealed Companies Act 1913 •Repealed Companies Ordinance 1984 and 2016 •Companies Act 2017
Features/Characteristics of a company?
1- Separate legal status.
2- Shares & their characteristics.
3- Separation of ownership from management.
4- Limited Liability of Members/Shareholders.
5- Legal Obligations.
6- Liability to pay Tax.
7- Perpetual succession or perpetual existence.
Consequences of separate legal Status?
1- Company can enter Into contracts with its own name.
2- A company owns its assets.
3- A company itself is liable for its debts.
Characteristics of Share?
1- Shares have some rights.
2- Shares are transferable.
Total Investment in a company is called?
Share capital
To whom the concept of Limited liability of company applies?
On Shareholders, Company is fully liable
Which laws governed the company?
1- Companies Act, 2017.
2- Memorandum of Association.
3- Articles of Association.
What is body corporate or corporation?
It includes
1- A company incorporated under company law.
2-A company incorporated outside pakistan.
3- A body corporate declared as body corporate under relevant statue.
however following are not body corporate;
a) A co-operative society
b) Statutory body
Write types of companies under companies Act 2017?
Types on the basis of Status;
1) Private company
2) Public company
Types on the basis of Liability;
1) Limited by shares
2) Limited by guarantee
3) Unlimited company
Other companies;
1) Holding and subsidiary company
2) Association not for profit
Private company can be?
1) Single member company
2) Other then single member company
Public company can be?
1) Listed Company
2) Unlisted Company
Private company limits maximum numbers(50), Restricts rights & Prohibits invitation by its articles or memorandum?
By Articles
If Shares are partly paid by member what is the liability of member and what kind of company is this?
Member is liable upto the unpaid amount and company is ‘‘Limited by shares’’
Liability of members is limited by memorandum or articles?
By Memorendum
Which words shall have to add to be add in name of public company and in name of company limited by guarantee?
World “limited” at end of public company name. and;
word “guarantee” in name of company limited by guarantee.
What makes company a subsidiary of another (Holding) Company?
If;
a) Other company controls more then one half of its voting securities, either by itself or together with one or more of its subsidiary companies.
b) Other company controls its composition of board.
Define Registrar?
Registrar means a registrar, an additional registrar, an additional joint registrar, a joint registrar, a deputy registrar, an assistant registrar or such other officer as may be designated be SECP, performing duties and functions under this Act.
what are the powers and duties of registrar?
1- To register memorandum/Articles of company & issue certificate of incorporation.
2- To approve name of company and rectification.
3- To approve alteration of memorandum and articles.
4- To issue certificate of commencement of business.
5- To receive various notes or documents.
6- To extend time to hold AGM for companies other than listed.
7- To call officers of a company for the information and explanation.
8- To inspect books and records of a company and seize them if he believes it is necessary.
Define the commission (SECP)?
The commission means the security and exchange commission of pakistan.
Where are the Organization and offices of SECP? Also mention its powers?
Head is in Islamabad and it has 8 regional offices;
•1 in Islamabad
•4 in each province
•1 each in Multan,Faisalabad and sukkur
SECP has function to regulate:
1- All companies
2- Banking companies amd non banking finance companies.
3- insurance companies and Modaraba companies.
What are the Powers and duties of Commission?
powers:
1- To register “Association not for profit”.
2- To allow certain words in name of company.
3- To confirm change in”Registered office” class of memorandum.
4- To approve prospectus for issue.
5- To extend to hold AGM for listed companies.
6- To approve lone to directors of a listed company.
7- To call general meetings if company makes default to hold them.
8- To listen appeal against decisions of Registrar.
What are the Powers of court?
court has power to declare following as void;
•Election of directors
•General meeting or its proceedings
•Resolution to vary shareholder’s rights.
Define resolution and write 1 difference between ordinary and special resolution?
Resolution is a decision reached by majority of members.
Ordinary resolution passed at general meeting by simple majority of votes of members, and Special resolution passed at GM by atleast 3/4th majority of members who ate entitled to vote
