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Business Law and Regulations > Law on Corp - Corporate Books and Records > Flashcards

Law on Corp - Corporate Books and Records Flashcards

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1
Q

What are the required books and records to be kept by Corporations?

A. Under RCC

A
  1. Articles of incorporation and by-laws
  2. Information regarding composition of the corp
  3. Information regarding governing board
  4. A record of all business transactions
  5. Record of resolutions
  6. Reportorial Requirements
  7. Minutes of all meetings of stockholders or members and board meetings
  8. Stock and transfer book, in case of stock corporations and membership book or list of members, in case of non-stock corp
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2
Q

Corp’s duty of keeping books and records is imperative and mandatory

True or False?

A

True

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3
Q

Proper custodian of the books is usually the corporate secretary

True or False?

A

True

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4
Q

All books must be kept at the?

A

Principal office, except that stock and transfer book may be kept in the principal office or office of its stock transfer agent

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5
Q

Corp Books and Records are open to inspection by any director, trustee, stockholder or member of the corp

True or False?

A

True

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6
Q

What are the right to Inspect Corporate Books?

A
  1. Right to inspect
  2. Right to demand in writing, at his expense
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7
Q

Under Basis of Ownership of Corporate Asset

A. Beneficial Ownership of Corp Assets

Stockholders or member have a right to be fully informed as to the condition of the corp

True or False?

A

True

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8
Q

Under Basis of Ownership of Corporate Asset

A. Beneficial Ownership of Corp Assets

Rights of SH to inspect rests on fact of ownership of assets and property of the corp through ownership of shares

True or False?

A

True

> therefore an incident of ownership of the corp property, whether the ownership or interest be termed an equitable ownership, beneficial or quasi

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9
Q

Under Basis of Ownership of Corporate Asset

B. Protection of Stockholders and General Public from Mismanagement, Fraud, and Other Wrongful Acts

Right to inspect to investigate the conduct of the management, determine the financial condition of the corp, and generally take an account of the stewardship of the officers and directors.

True or False?

A

True

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10
Q

Under Basis of Ownership of Corporate Asset

B. Protection of Stockholders and General Public from Mismanagement, Fraud, and Other Wrongful Acts

Right to examine

True or False?

A

True

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11
Q

What are the remedies and sanctions for Enforcement of Right?

Under:
A. Reporting to and Summary Investigation by the SEC

A

5 days from receipt of such report, SEC shall conduct a summary investigation

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12
Q

What are the remedies and sanctions for Enforcement of Right?

Under:
B. Liability for damages and for an offense punishable under the RCC action filed in court

Any officer who shall refuse shall be liable for damages

True or False?

A

True

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13
Q

What are the remedies and sanctions for Enforcement of Right?

Under:
B. Liability for damages and for an offense punishable under the RCC action filed in court

Guilty of an offense which shall be punishable at what amount?

A

10,000 to 200,000

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14
Q

What are the remedies and sanctions for Enforcement of Right?

Under:
B. Liability for damages and for an offense punishable under the RCC action filed in court

When violation is injurious or detrimental to the public, penalty is at what amount?

A

20,000 to 400,000

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15
Q

What are the limitations on the Right to Inspection?

A

A. Purpose of Inspection

  • must be legitimate or proper purpose
  • Purpose is to find out the actual financial condition of the corp and how his investment is being used
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16
Q

What are the limitations on the Right to Inspection?

A

B. Books of Foreign Corporation
- right does not apply where the corp is not organized under Philippine Law

17
Q

What are the limitations on the Right to Inspection?

A

C. Confidentiality Rules
- Inspecting or reproducing party shall remain bound by confidentiality rules, as the rules on trade secrets or processes under Intellectual Property Code of the PH

18
Q

What are the limitations on the Right to Inspection?

A

D. Place of Inspection
- Requires every stock corporation to keep its stock and transfer books in the principal office

19
Q

What are the limitations on the Right to Inspection?

A

E. Reasonable Regulations
- As to time, place, and proper purpose which the corp through the bylaws may prescribe (at all times)
- right may only be exercised at reasonable hours on business days

20
Q

What are the Extent of the Right of Inspection?

A

A. Copies, Abstracts, and Memoranda
B. Agent or Representative
C. All pertinent books, papers, etc

21
Q

What are the Extent of the Right of Inspection?

Under:
A. Copies, Abstracts, and Memoranda

A
  • The right to make copies, abstracts, and memoranda of their contents
  • But stockholder or member cannot, without order of the court
  • Any stockholder or member has the right to receive the corporation’s most recent financial statement
22
Q

What are the Extent of the Right of Inspection?

Under:
B. Agent or Representative

A

The inspection and examination may be made by any proper representative or attorney-in-fact, and either with or without the attendance of the director

23
Q

What are the Extent of the Right of Inspection?

Under:
C. All pertinent books, papers, etc

A
  • Extends to all books, papers, contracts, minutes, books or other instruments from which he can derive any information that will enable him to better protect his interest
24
Q

To Whom right is not available about the inspection of corporate books and records?

A

A. Requesting party who is not a stockholder or member, or is a competitor director, officer, controlling stockholder or otherwise represents the interest of a competitor

B. Person who has improperly used information secured through any prior examination

C. A person is not acting in good faith or for legitimate purpose

25
Q

What are the liability for abuse of right of inspection?

A

Imposition of a fine ranging from P5,000 to 2,000,000, and not more than 1,000 for each day of continuing violation but in no case to exceed 2,000,000 and the issuance of a upermanent cease-and-desist order, without prejudice

26
Q

A record of all stocks in the names of the stockholders alphabetically arranged, the installments paid and unpaid on all stocks for which subscription has been made, and the date of payment of any installment; a statement of every alienation, sale or transfer of stock made, the date thereof, by and to whom made; and such other entries as the by-laws may prescribe.

True or False?

A

True

27
Q

The stock and transfer book shall be kept in the principal office of the corporation or in the office of its stock transfer agent and shall be open for inspection by any director or stockholder of the corporation at reasonable hours on business days.

True or False?

A

True

28
Q

One engaged principally in the business of registering transfers of stocks behalf of a stock corporation.

True or False?

A

True

29
Q

No stock transfer agent shall be allowed to operate in the Philippines unless he secures a license from the SEC and pays a fee as may be fixed by the SEC which shall be renewable annually. A stock corporation is not precluded from performing or making transfer of its own stocks, in which case all the rules and regulations imposed on stock transfer agents, except the payment of a license fee herein provided, shall be applicable.

True or False?

A

True

30
Q

The financial statements must be duly signed and certified in accordance with me RCCP, and the rules the SEC may prescribe, except that if the total assets or total liabilities of the corporation is less than 600,000, or such other amount as may be determined appropriate by the Department of Finance, the financial statements may be certified under oath by the treasurer and the president.

True or False?

A

True

  • Under Section 177, the financial statements must be audited by an independent certified public accountant if the total assets or total liabilities of the corporation is P600,000 and above.
31
Q

Within what days from receipt of a written request of any stockholder or member, the corporation shall furnish to him its most recent financial statement, in the form and substance of the financial reporting required by the SEC?

A

10 days

32
Q

At the regular meeting of stockholders or members, the board of directors or trustees shall present to such stockholders or members a financial report of the operations of the corporation for the preceding year, which shall include financial statements, duly signed and certified in accordance with the RCCP, and the rules the SEC may prescribe.

True or False?

A

True

Business Law and Regulations (9 decks)

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