Appointment and Remuneration of Managers

<p>The financial and operating performance over the last three years (D)</p> Signup and view all the answers

<p>By using a rating methodology that assesses director remuneration proportionately (C)</p> Signup and view all the answers

<p>It is one of the factors to be taken into account (D)</p> Signup and view all the answers

<p>There should be a consideration of the relationship for remuneration fixing (C)</p> Signup and view all the answers

<p>The appointment and remuneration of managerial personnel (B)</p> Signup and view all the answers

<p>They must have no direct or indirect interest related to the company's directors. (B)</p> Signup and view all the answers

<p>Graduate level qualification (B)</p> Signup and view all the answers

<p>0.5% (B)</p> Signup and view all the answers

<p>No defaults in payments to banks or creditors. (D)</p> Signup and view all the answers

<p>Either an ordinary or special resolution depending on the remuneration type. (C)</p> Signup and view all the answers

<p>100,000 rupees (A)</p> Signup and view all the answers

<p>Three years (D)</p> Signup and view all the answers

<p>Independent Directors (A)</p> Signup and view all the answers

<p>Statement containing specific information about remuneration (A)</p> Signup and view all the answers

<p>exclusive of the amounts mentioned under Section 197(1) (D)</p> Signup and view all the answers

<p>Approval from the concerned bank or creditor (D)</p> Signup and view all the answers

<p>45,000 rupees (A)</p> Signup and view all the answers

<p>The class of the company (C)</p> Signup and view all the answers

<p>Sitting fees cannot exceed the remuneration prescribed based on company class. (B)</p> Signup and view all the answers

<p>The increase must not exceed the prescribed limits. (B)</p> Signup and view all the answers

<p>Different fees for independent directors (D)</p> Signup and view all the answers

<p>Chief Executive Officer (C)</p> Signup and view all the answers

<p>To perform functions as defined under the Companies Act (A)</p> Signup and view all the answers

<p>The total compensation allowed for managerial roles (A)</p> Signup and view all the answers

<p>Shareholder (D)</p> Signup and view all the answers

<p>It is calculated at a lower rate (B)</p> Signup and view all the answers

<p>Severance package for departing Managers (A)</p> Signup and view all the answers

<p>A company secretary recognized as practicing under specific laws (B)</p> Signup and view all the answers

<p>Lead Technician (D)</p> Signup and view all the answers

<p>When the company's articles permit it. (A)</p> Signup and view all the answers

<p>Companies with multiple businesses and appropriate leadership. (B)</p> Signup and view all the answers

<p>It must be documented in a board resolution. (D)</p> Signup and view all the answers

<p>They can hold office in one company and its subsidiaries only. (C)</p> Signup and view all the answers

<p>They must choose one company to remain in office within six months. (C)</p> Signup and view all the answers

<p>It is critical for defining class status for managerial appointments. (C)</p> Signup and view all the answers

<p>The terms and conditions including remuneration (C)</p> Signup and view all the answers

<p>It allows for flexibility in appointing managerial personnel if certain conditions are met. (B)</p> Signup and view all the answers

<p>Revaluation reserve (C)</p> Signup and view all the answers

<p>Date of the managerial person's appointment (B)</p> Signup and view all the answers

<p>Working capital loans (C)</p> Signup and view all the answers

<p>If they have no interest in company capital (A)</p> Signup and view all the answers

<p>Remuneration is pro-rated (A)</p> Signup and view all the answers

<p>Interest due on loans (A)</p> Signup and view all the answers

<p>An entity entitled to hold shares (B)</p> Signup and view all the answers

<p>Long-term deposits (B)</p> Signup and view all the answers

The process of selecting a Managing Director for a company, governed by the Companies Act, 2013.

The procedure for appointing a Whole-Time Director, following predefined company rules.

The method for appointing Key Managerial Personnel (KMPs) as outlined in the act.

The process of determining compensation for managerial personnel, often linked to company performance.

The legal upper limit on compensation for managers set by the act.

An officer designated by the company as the CEO, as defined in Section 2(18).

A person appointed as the CFO of a company, according to Section 2(19).

A designated company secretary handling administrative functions, based on the Company Secretaries Act, 1980.

Companies whose articles of association allow the Chairperson to also serve as MD or CEO are exempt from the prohibition.

A specified category of companies (with high paid-up capital, turnover, and multiple business divisions) having a CEO for each division, exempt from the prohibition.

Every whole-time key managerial personnel must be appointed by a formal board resolution specifying their duties and compensation.

Whole-time key managerial personnel cannot hold positions in more than one company simultaneously (except for subsidiaries).

Key managerial personnel may also be directors, if permitted by the board.

Existing key managerial personnel holding simultaneous positions in numerous companies must choose one within six months to remain in.

The total amount of money invested in a company by its shareholders.

The total amount of revenue generated by a company each year.

This section outlines how a company can determine managerial remuneration (salary) when experiencing low or no profits. It sets limits and considers factors like financial performance, experience, and qualifications.

A company's self-imposed limit on managerial remuneration, within the legal limits set by the Companies Act.

The maximum amount that a company can legally pay its managers, as set by the Companies Act.

When deciding on managerial pay, companies must consider the company's financial health, the manager's experience and knowledge, and how much they are paid in other roles. This applies to both internal and external positions.

Ensure fair compensation for managers, comparing their pay to other managers in the same company and to employees at different levels. This promotes balance within the organization.

A system to assess the performance of managers, helping to determine fair compensation relative to their contributions and responsibility.

Companies evaluate their financial performance over the past three years to assess their ability to pay managers. This helps determine if salary increases are justified.

Companies should ensure that managerial compensation is tied to how well they perform. Rewards for exceeding expectations, while under-performance may lead to reduced pay.

The total value of a company's assets used to calculate maximum executive pay limits. It includes paid-up share capital, reserves, surplus, and long-term loans, but excludes investments, losses, and preliminary expenses.

A fund created when shares are issued at a price higher than their face value. This excess money is added to the company's reserves and contributes to 'effective capital'.

A reserve created when a company's assets increase in value, reflecting the market value rather than the original cost. It's excluded from 'effective capital'.

Investments (except for investment companies), accumulated losses, and preliminary expenses not yet written off. These are not considered readily available funds for operating the company.

For newly incorporated companies where a managerial appointment happens in the same year, effective capital is calculated on the appointment date. Otherwise, it's calculated at the end of the previous financial year.

When a managerial person is employed for less than a full year, their remuneration is calculated proportionally to their time of service.

A manager can receive the maximum compensation allowed if they don't have any direct or indirect interest in the company's capital, including its holding company or subsidiaries.

An entity authorized by law to own shares in companies, such as a trust or a registered association. This is considered when assessing if a managerial person has capital interest.

To be an Independent Director, an individual must not have any direct or indirect interest in the company or its related entities for at least two years before and after their appointment.

Independent Directors must hold a graduate-level qualification and possess specialized knowledge in the company's field of operation.

An employee holding shares of the company, not exceeding 0.5% of its paid-up share capital, under an employee share scheme, including stock options, is considered not to have an interest in the company's capital.

Remuneration for Key Managerial Personnel (KMP) must be approved by the Board and, in relevant cases, the Nomination and Remuneration Committee.

The company must not have any default in payments to banks, financial institutions, or creditors before the remuneration approval.

Payment of remuneration to KMPs must be approved by the company's shareholders through an ordinary or special resolution, for a maximum period of three years.

The company must disclose specific information on the proposed remuneration to its shareholders before the general meeting where the resolution is voted on.

The remuneration for KMPs can be approved by the general meeting for a maximum period of three years.

Payments made to directors for attending board or committee meetings or for other specified purposes, as determined by the company board.

The maximum amount a director can receive as a sitting fee per meeting, currently capped at ₹1 lakh.

Independent directors are entitled to a sitting fee that is not less than what other directors receive.

Companies can have different sitting fee structures for various types of directors, including specific fee amounts for independent directors.

A company can propose to increase the sitting fee for directors, but the new amount must not exceed the prescribed limit.

This section of the Act governs the remuneration of directors, including the maximum allowable sitting fees.

The company board has the authority to decide on sitting fees for directors, subject to the prescribed limits and rules.

A company's articles of association may specify limitations on the amount of sitting fees payable to directors.