Tag: promotion and formation of a company

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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 body of elected representatives of shareholders of a company is called ______________.

  1. Board of Directors

  2. Managing Directors

  3. Secretary

  4. None of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation
Shareholders elect a team of members that represent the interests of shareholders and manages the company on behalf of the shareholders. They collectively form the Board of Directors which is headed by the Chairman or Chairperson.
Managing Director is the key managerial personnel of a company who represents the company and takes relevant and crucial decisions for the company. Managing Director is granted with powers to manage, by the Board.
Company Secretary is also a key managerial personnel of a company who is a link between the Board of Directors, shareholders, and government/regulatory authorities. He/She ensures that the procedures are followed and reviewed regularly, besides providing guidance on the responsibilities of Directors and Chairman.
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 auditors are appointed for a period of _______at a time.

  1. one year

  2. two years

  3. three years

  4. four years
Reveal answer Fill a bubble to check yourself
A 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.

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 qualified to carry out audit work of a company is called _____________.

  1. Auditor

  2. Secretary

  3. Director

  4. None of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation
1.An auditor is the person who prepares an independent report for the shareholders of the company. He/She is given the powers to audit the books of accounts of the company. A person shall be eligible for appointment as an auditor of a company only if he is a Chartered Accountant.
2.Company Secretary is also a key managerial personnel of a company who is a link between the Board of Directors, shareholders, and government/regulatory authorities. He/She ensures that the procedures are followed and reviewed regularly, besides providing guidance on the responsibilities of Directors and Chairman.
3.Director is the managerial personnel of a company who represents the company and takes relevant and crucial decisions for the 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 Registrar of Companies is appointed by the _________.

  1. State Government

  2. Central Government

  3. Local Government

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

The Registrar of Companies is appointed by Central Government with the power vested under Section 396 of the Companies Act 2013 the Central Government registrar and additional, joint, deputy, and assistant registrars for various states and union territories in India. Apart from the primary companies incorporated in the respective states and the union territories, Registrar of Companies is also responsible for ensuring that the companies comply with statutory requirements under the said 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

An auditor has the right to communicate the audit results to _______.

  1. employers

  2. some other auditor

  3. company

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

An auditor is the person who does the audit of the company. He makes the financial statements of the company. He communicates the audit results tot he company so that the company may know about the frauds and errors in the statement.

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

DIN is a unique identification number for _______.

  1. existing director of the company

  2. person intending to become director of the company

  3. existing Chairman of the company

  4. both a and b
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

DIN is an unique identification number given to an existing or a potential director of any company which is incorporated. Hence, DIN is a unique identification number for existing director of the company and person intending to become director of the 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

Management of a business organization should be on compulsory basis in the hands of ________.

  1. shareholders

  2. workers

  3. both a and b

  4. none of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Shareholders are the owners of the business. They look over all the operations of the business. They are simply managers of the business. Hence, the management of a business organization should be on compulsory basis in the hands of shareholders.

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

Maximum number of partners in case of non-banking business is _____.

  1. 100

  2. 20

  3. 30

  4. 40
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

According to the Companies Act, 2013, the maximum number of partners for a non-banking business is 100. This was an increase from the previous limit of 20 under the 1956 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

For several reasons, it is important to determine whether or not a person is a promoter. Which one of the following reasons is not valid?

  1. Promoters owe fiduciary duties to the unformed company.

  2. Promoters are subject to certain provisions contained in the Companies Act.

  3. Promoters may be liable for acts entered into on behalf of the unformed company.

  4. Promoters who sign their name on behalf of an unformed company can face criminal liability if the company is not subsequently fully incorporated.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Promoter means a person—

 (a) who has been named as such in a prospectus or is identified by the Company in the annual return referred to in section 92; or
 (b) who has control over the affairs of the Company, directly or indirectly whether as a shareholder, director or otherwise; or

 (c) in accordance with whose advice, directions or instructions the Board of Directors of the Company is accustomed to act
 (d) Promoters owe fiduciary duties to the unformed company.
 (e) Promoters may be liable for acts entered into on behalf of the unformed company.