Section D: company Administration Flashcards
When will a court lift the veil of incorporation?
When it is being used to evade legal obligations.
To recognise that a quasi-partnership relationship has broken down
When a group of companies has been operating as a single economic entity
Should companies within groups be treated as single legal entities?
Yes
What changes must always be made to an off the shelf company when purchased from a formation agent?
Changing it’s register of members
What are 3 features of an off-the-shelf company?
May be cheaper than incorporating yourself.
Company is able to trade immediately
Company can enter into contract immediately
Should the articles of association state the company’s name?
YES
What type of company must obtain a trading certificate from the Registrar of companies before it can commence trading?
PLC
What do the Articles of Association regulate and can they be drafted by the company themselves?
Issue of shares
Members rights.
- Yes can be drafted by the company themselves.
Who does a company’s constitution bind?
The company and it’s members
How long must PLC hold their accounting records for?
6 years.
What are the model articles of association?
Model articles of association describe how the company is to be managed and administered.
What are the correct audit requirements for PLCs & Private companies?
PLC: Must always be audited.
Private: Must be audited if they meet certain financial criteria.
A company can trade in its name on what date?
The date of the certificate of incorporation.
What type of company is allowed to drop the word Limited form it’s name?
A company limited by guarantee.
What is included in the content of a company’s model articles of association?
Payment of dividends
Appointment of directors
Clauses relating to communication with members.
