11 & 13 - Roles, Responsibilities and Requirements of Directors Flashcards
1
Q
What is a quasi-loan?
A
[s.199] company agrees to pay off an outstanding account owed by D to 3P on the understanding that D will later reimburse the company
2
Q
What is a credit transaction?
A
[s.202] company provides goods/services on a credit basis which will be paid off later by D - No 3P involved
3
Q
What is a close company?
A
A company under the control of:
- 5 or fewer participators, or
- Any number of participators who are also directors
4
Q
What kind of approval is necessary when a company wants to make a loan to a director?
A
shareholder approval by ordinary resolution
5
Q
What nature of company requires shareholder approval when making a loan?
A
- Private company
- Public limited company
- Private company associated with a public company
6
Q
What approval is needed for a substantial property transaction under s.190?
A
Ordinary resolution - if director/connected person buys/sells a substantial non-cash asset from/to the company
