Category: CPA Company law revision

Outline the circumstances under which a floating charge will crystallise ANSWER • Default in payment of the principal or interest when due and payable provided the chargee takes some step to enforce the security. • Commencement of recovery proceedings against Read More …

Outline the exceptions to the general prohibition on financial assistance a company for the purchase of its own shares ANSWER The rule in Trevor v Whitworth prohibits the company from purchasing its shares. This rules is now embodied in Read More …

What are advantages and disadvantages of a floating charge to a debenture holder? ANSWER • Capacity to appoint receiver or manager in the event of default. • It charges both existing and future assets of the company. • Upon crystallization, Read More …

In what circumstances may a public company register a statement in lieu of prospectus with the registrar? ANSWER When a private company goes public in accordance with the provisions of the Companies Act, a copy of a statement in lieu, Read More …

Analyse the circumstances under which the group accounts of a company need not deal with a subsidiary of the company ANSWER These accounts must give a true and fair view of the state of affairs and profit or loss of Read More …

What books of account is a company required to keep and what provisions regulate group accounts? ANSWER Every company must keep certain books in the English language, namely: • Assets and liabilities of the company. • Sales and purchases of Read More …

Companies Act provides that “A printed copy of every resolution or agreement shall, within 30 days after the passing or making thereof, be delivered to the registrar for registration”. Identify five resolutions or agreements registrable under this section. ANSWER • Read More …

Outline the classes of persons who may effectively demand for a poll during a general meeting ANSWER • The chairman of the meeting. • At least five members present in person or proxy. • A member or members representing Read More …

What are the salient duties and powers of the Chairman of a general meeting of a company? Illustrate your answer with reference to decided cases ANSWER Duties • Satisfy himself that the meeting is duly constituted. • Inform himself the Read More …

Explain how the capital of a company may be: i) Altered; ii) Reduced; iii) Increased; ANSWER Under the Companies Act, the capital of accompany can be altered in various ways namely: • Increase of capital • Sub-division of shares • Read More …