Limited Company

Question 1

Veil of corporation

Answer 1

People/organisations with a claim against the company have no legal rights against the investors own personal assets

Question 2

Limited liability

Answer 2

If limited company fails to pay the creditor then may have little chance of successfully pursing an action against the company
No assets=creditors not being paid

Question 3

Info needs of company creditors

Answer 3

Creditors that trade to other companies know they will get their money back
Companies are obliged to make info available within 9months of the year

Question 4

Infor needed by company shareholders

Answer 4

Where company directors and shareholders are 2diff people it is important the directors are held accountable for the way which they have managed shareholders investments=STEWARDSHIP

Question 5

Private company

Answer 5

Minimum one shareholder
Minimum one director
Limited attached to name in English or welsh

No longer obliged to hold agms

Question 6

Public company

Answer 6

Register in its memorandum of association as a public company
Name must end in plc
Must have share capital of at least 50 grand
2 directors + company secretary

Still obliged to hold formal agms

Question 7

Memorandum of association

Answer 7

Statement made by each of the Orginal subscribers for shares in the company, confirming their intentions to form in company and to become a shareholder in it

Question 8

Directors responsibilities

Answer 8

Responsible for preparing company’s annual financial statement-filed at companies house
Does not trade while insolvent-If caught may be ordered to make contributions out of personal resources
Fair and true view
Financial statement often carried out by financial director/accountant but director takes complete responsibility