People in a company Flashcards
Does a company require a company secretary?
Private - No
Public - Yes
What rights are laid out for shareholders in the articles?
Rights to vote and dividend
When does a shareholder’s membership begin?
When member’s name is entered in the company’s register of members
Can a shareholder be a non-human entity?
Yes, a shareholder can be a company
This is often used to isolate risk and mitigate tax.
What is the nominal value of shares?
The minimum price at which shares can be issued - shares may not be issued at a discount to the nominal value, but can be issued at a premium
What is the issued share capital?
The total value of all shares in issue, even if the full amount hasn’t been paid yet.
Is it necessary to pay the full amount of issued share capital immediately?
No, it is not necessary to pay full amount immediately but the company can call upon shareholders to pay at any time.
What does share capital include?
Includes both subscriber shares and further shares issued after incorporation
What is meant by limited liability?
Shareholders are only liable for the company’s debts to the extent of their investment
What fiduciary duties do directors owe?
Directors owe fiduciary duties to the company
What is the minimum age requirement to be a director?
Minimum age of 16
How many directors must be natural persons?
At least 1 must be a natural person
What is an executive director?
An employee with a contract
They are involved in the day-to-day operations of the company.
What is a non-executive director?
Not an employee
What is a shadow director?
A person in accordance with whose directions the directors are accustomed to act
What is the role of alternate directors?
Can attend meetings in directors’ place - not automatic in MA!
What defines a de facto director?
Assumed to act as one but not appointed
How many directors must a company have?
Private company - 1
Public company - 2
What certificates does a public company need before it can begin trading?
- Certificate of incorporation
- Trading certificate to show the allotted share capital is above the minimum (£50,000)
