Director

Question 1

Shadow director

Answer 1

Person on whose commands or instructions the directors are accustomed to act

Question 2

De facto director

Answer 2

Person who purports to act as though they were director

Question 3

Alternate director

Answer 3

Who attends board meetings when director is unable to attend

Question 4

Non executive director

Answer 4

-Integral element of corporate governance
-Bring an independent view
-Help in providing effective leadership
-Help to establish and maintain financial probity
-keep an eye on executive director

Question 5

Private comp should have atleast

Answer 5

1 director

Question 6

Public company should have

Answer 6

Atleast 2

Question 7

Eligibility of director

Answer 7

Over 16
May be non natural person
Must not be disqualified by CDDA
Must not be bankrupt
Not unsound mind
Should not be absent of board meetings without permission for a period in excess of 6 months

Question 8

Company director is disqualified for period generally

Answer 8

In general, disqualification period is up to 15 years

Question 9

On no of grounds, court may decide a person is disqualified to act as a director

Answer 9

For an offence committed in the promotion, formation, management, liquidation or striking off a company

Persistently in default (3 offences in 5 years) of filing returns

Found guilty of fraudulent or wrongful trading

When involved in a company insolvent liquidation (2 in period of 5 years)

Question 10

Breaking the disqualification order

Answer 10

Upto 2 years in prison

Question 11

First directors

Answer 11

Named in documents sent to registrar before incorporation

Question 12

Subsequent director appointed by:

Answer 12

Members in general meeting
Other directors - fill casual vacancy
The court (rare)
A lender (if part of the loan agreement)
Administrator (under an administration order)

Question 13

1/3 rotation procedure

Answer 13

Every general company,

Question 14

Ftse top 350 (public quoted company)

Answer 14

Every year all directors retire

Question 15

Directors are appointed by which resolution

Answer 15

Ordinary resolution
And registrar is notified

Question 16

Directors removed by which resol

Answer 16

Ordinary resolution

Question 17

Directors removal (special notice)

Answer 17

Notice period is special
-28 days notice to company (director involved)
-21 days notice to members (shareholders)

Opportunity to make written representations of reasonable length and not defamatory in nature

Question 18

Must satisfy legal restrictions of removal

Answer 18

100 members holding greater than or equal to 100 pound share capital on average

Question 19

Notice to registrat

Answer 19

28 days notice sent to registrar too
And representation also

Question 20

Company may have to pay

Answer 20

Substantial compensation to removed director (if contract was made so breach of contract)

Question 21

Statutory duties of directors - 7 duties

Answer 21

Act within their powers
Perform their duties with reasonable skill, care and diligence
Promote success of company
Independent judgement
Avoid conflict of interest
No benefits from third parties
Declare interest in transaction/contracts

Question 22

Directors - promoting success

Answer 22

-Statute trying to encourage long term approach by directors

-Directors to have regard for all stakeholders (who have direct or indirect interest in the company) pakistan pollute

Non exhaustuvr list of matters

Question 23

Non exhaustive list of matters director need to consider:

Answer 23

-Long term consequences of their decision
-employees interest
-good relationship with customers and suppliers
-local community and environmental impact
- high standards of business conduct
- good reputation
- fair treatment for all members

Question 24

Directors - controls (service contract should not be

Answer 24

More than or equal 2 years then members approval required

For public comp not more than 1 year and if they do compensation payable on termination shud not exceed 1 year salary

Question 25

Acquisition of non cash assets memberd approval if >_ 10% of company’s assets

Answer 25

But not less than 5ooo pounds
And always if greater than 100,000 pounds

If 10% zyada hojaye toh approval

Question 26

No company may lend money

Answer 26

Provide security nor guarantee a loan to director of itself, nor of its holding company unless approved by members

Question 27

Relevant company restrictions apply to connected persons

Answer 27

Control

Question 28

Relevant companies cannot

Answer 28

Quasi lend (unless less than 5000)
Approve credit transactions (unless less than 10,000) unless approved by lenders

Loans by money lending companies allowed for purchase or improvement of main or only residence up to 100,000