Commerce Accountancy · Law Legal Studies

Business Organizations and Corporate Governance

1,376 Questions

Business organizations and corporate governance explore company structures, stakeholder responsibilities, and regulatory frameworks under the Companies Act. These commerce topics are essential for Chartered Accountancy, company secretary exams, and banking probationary officer assessments. Practice these questions to master corporate formation, director roles, and business ownership types.

Companies Act 2013 provisionsCorporate stakeholder rolesPrivate limited company rulesDebenture holder rightsCompany incorporation rulesState-owned enterprises

Business Organizations and Corporate Governance Questions

Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company

State the following statement is True or False:
All companies can start business after receiving the Certificate of Incorporation.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

True

Companies registered wit the Registrar of Companies can start a business right after incorporation. Which means once the company receives its Certificate of Incorporation from the Registrar, it can start its business. 

Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company

State the following statement is True or False:
The second stage in the formation of a Joint Stock Company is incorporation.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

True

Incorporation or registration is the second stage in the formation of a company. It is the registration that brings a company into existence. A company is properly constituted only when it is duly registered under the Act and a Certificate of Incorporation has been obtained from the Registrar of Companies.

Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company

The Registrar of Companies issues incorporation certificate to the company.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

This statements is true,due to the following reasons:


(i) "Registrar " means a registrar,an additional, a joint, a deputy or an assistant registrar , having the duty of registering companies under this act.


(ii) They area appointed in each state by the Central Government.

(iii) The Registrar is a statutory authority under the Companies Act.

(iv) His appointment is made under section 609(2) of the Companies Act and is responsible  for the administration of the company law in his states.

(v) The Registrar of companies has to carry out routine functions  relating to company law  administration.

(vi) He has, therefore been given wide power by the Company Law Board.

(vii) He also performs different functions like to receive notices, returns, reports and record prospectus to be filed by the companies.

(viii) To inspect the Documents, Register, Financial records etc. of a company at any time. 

(ix) To record alteration of Memorandum and Articles of Association of the company.

(x) To issue the Certificate of Incorporation and the Certificate of  Commencement of Business is also the function of the Registrar of companies.

Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company

Match the Groups :

(II) Group 'A' Group 'B'
(i) Registrar of Companies (a) Six
(ii) Advisory Committee (b) Disposal of assets of company
(iii) Company Law Board (c) Five members
(iv) Number of Regional Directors (d) Purchase of assets of company
(v) Official Liquidator (e) Nine members
(f) Trading Certificate
(g) Seven members
(h) Eight
(i) Four members
(j) Head of Companies

  1. (i - f), (ii - c), (iii - e), (iv - a), (v - b)

  2. (i - h), (ii - c), (iii - e), (iv - j), (v - b)

  3. (i - f), (ii - g), (iii - i), (iv - a), (v - b)

  4. (i - a), (ii - c), (iii - j), (iv - h), (v - b)
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The correct matches of the groups are:

Registrar of Companies is a trading certificate.
Advisory committee have Five members.
Company Law Board have Nine members.
Number of Regional Directors are six in number.
Official liquidator job is to dispose of assets of company.  

Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company

The working of Registrar of Companies of a region is supervised by ________.

  1. Court

  2. Advisory Committee

  3. Regional Directors

  4. Shareholders
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The seven regional registrar of companies are in charge of the respective regions each region comprising a number of States and Union Territories. They supervise the working of registrars of the companies in their region . They also maintain a liaison between the respective State government and the Central government in matters relating to the administration of the Companies Act.

Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company

The Company Law Board consists of not more than ________ members.

  1. seven

  2. nine

  3. six

  4. ten
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The Company Law Board shall consist of such number of members, not exceeding nine, as the Central Government deems fit, to be appointed by that Government by notification in the Official Gazette

Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company
Every company has it's own Articles of Association. 

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation
(i) Articles of Association states the rules and regulations of a company. 
(ii) It is framed for internal management of the company. 
(iii) It deals with the rights of the members of company. 
(iv) Articles are subordinate to the Memorandum of Association. 
(v) It states the relationship between the company and its members, staff, etc. (vi) Articles of Association defines how the business of the company should be carried on. 
(vii) Articles of Association are governed by Memorandum of Association. 
(viii) The Articles of Association being an important document is required to be filed with the Registrar of Companies. 
(ix) The preparation and filing of Articles of Association is compulsory in case of Private Limited Company by guarantee and an Unlimited Company. 
Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company

Write a word or a term or a phrase which can substitute the statement:
The authority that has right to issue incorporation certificate to the company.

  1. An official liquidator

  2. Regional Director

  3. Registrar of Companies

  4. None of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The Registrar of Companies (ROC) is an office under the Indian Ministry of Corporate Affairs that deals with administration of the Companies Act 1956 and Companies Act, 2013. There are currently 22 Registrars of Companies (ROC) operating from offices in all major states of India

Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company
The policies of a company are framed by the __________.

  1. Secretary

  2. Managing Director

  3. Board of Directors

  4. None of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The policies of a company are framed by the Board of Directors. The board of directors have a very defined role and responsibilities within the business organisation. The board has the responsibility of developing a governance system for a business i.e they make the policies of the organisation.

Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company

The persons or the body of the persons appointed to inspect the books of accounts of the company are called _______ of a company.

  1. Directors

  2. Secretary

  3. Auditors

  4. None of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation
According to Section 139 of the Companies Act 2013, every Company shall at the First Annual General Meeting appoint an Individual or firm as an Auditor who shall hold office from the conclusion of this meeting until the conclusion of sixth Annual general Meeting. A person shall be qualified to be appointed as an auditor of a Company only if he is a Chartered Accountant. Such an auditor is given with the powers to inspect the accounts of the company to make sure that the financial statements give a true and fair few of the transactions.
Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company

A person who is purchases share of the company is called____________.

  1. Manager

  2. Secretary

  3. Shareholder

  4. Director
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Shareholder is a person that owns shares of a company. They can be equity shareholders or preference shareholders. A person who purchases share of he company is called a shareholder.