18 Questions
Which form of business organization is characterized by having a Board of Directors?
Joint Stock Company
In a Co-operative Society, who constitutes the managing body?
Managing Committee
Which type of company has an independent legal entity with a common capital comprised of transferable shares?
Joint Stock Company
In which form of business organization does the government have the least control over the working?
Joint Stock Company
Which type of company is known to have limited government control over its operations?
Private Company
What is a key characteristic of a Joint Stock Company developed after the industrial revolution?
Common capital with transferable shares
Why do shareholders elect the Board of Directors?
Because they are the real owners
What happens to membership in a company when shares are sold?
Membership ends once shares are sold
Why can a Joint Stock Company raise huge capital?
Due to large number of members
What is a requirement for the number of members in a private limited company?
Must have a minimum of 2 members
Why do shareholders of a public company have the freedom to sell shares?
To ensure shares are freely transferable
Why is registration compulsory for all companies?
To comply with company law regulations
What is the role of the Secretary in a company?
To oversee the day-to-day affairs of the company
Which legislation defines the appointment requirements for a Company Secretary in India?
Companies Act 2013
What qualification is required for a Company Secretary in India?
Member of the Institute of Company Secretaries of India (ICSI)
Who is considered the administrative head of a Ministry or Department in Government departments in India?
Secretary
How are Key Managerial Personnel (KMP) defined in the Companies Act 2013?
KMPs are executives and managers tasked with day-to-day affairs
What examination must a Government Secretary in India pass to qualify for the position?
Civil Services Examination conducted by the Public Service Commission
Study Notes
Characteristics of Joint Stock Company
- Shareholders are the real owners of the company, but they cannot manage the day-to-day affairs due to their large number, scattered location, and frequent changes.
- The Board of Directors is elected by shareholders to manage the company and make policy decisions.
Transferability of Shares
- Shares of a public company are freely transferable, allowing shareholders to sell their shares as desired.
- Membership ends once shares are sold.
Membership
- A private limited company must have a minimum of 2 members and a maximum of 200 members.
- A public limited company must have a minimum of 7 members, with no limit on the maximum number of members.
Capital
- Joint Stock Companies can raise huge capital due to a large number of members.
- Capital can be collected through shares, debentures, bonds, public deposits, and loans from banks and financial institutions.
Government Control
- Joint Stock Companies operate under government control and supervision, requiring compulsory registration.
- Registered companies must follow regulations stated in company law.
Types of Companies
- Forms of business organization include Sole Trading Concern, Joint Hindu Family Business, Partnership Firm, Limited Liability Partnership, Joint Stock Company, and Co-operative Society.
Joint Stock Company
- A Joint Stock Company is a registered association with an independent legal entity, perpetual succession, common capital, and limited liability.
- It is a formal form of business organization developed after the industrial revolution.
Types of Joint Stock Companies
- Types of companies based on incorporation: Statutory Company and Registered Company.
- Types of companies based on the number of members: Private Company, Public Company, and One Person Company.
Company Secretary
- A Company Secretary is included in the definition of Key Managerial Personnel (KMP).
- Appointment of Company Secretary is as per the Companies Act 2013.
- Qualification: A Company Secretary must be a member of the Institute of Company Secretaries of India (ICSI).
Secretary of Government Department
- A Secretary is the administrative head of a Ministry or Department in the Government.
- Qualification: A Secretary needs to possess a graduation degree and pass the Civil Services Examination conducted by the Public Service Commission, and be in Indian Administrative Services (IAS).
Learn about Key Managerial Personnel (KMP) as per the Companies Act 2013. Understand the roles, appointment process, and responsibilities of the Company Secretary who is considered a KMP. Explore the concept covered in Chapter 6 of the Act.
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