Subject: Business Studies
This note contains the main document of the joint stock company. Main document of joint stock company are Memorandum of Association, Article of Association and Prospectus.
The main documents for incorporation of a joint-stock company are as follows:
Memorandum of Association is the constitution of the joint stock company. It directs or instructs joint stock company. The joint stock company runs in accordance with the memorandum of association. Activities of the joint stock company are directed by the Memorandum of Association. Memorandum of Association is regarded as a blueprint as it is needed for the incorporation of the joint stock company. Memorandum of association is submitted to Company Registrar Office. Basic information and provision of the company are clearly mentioned in the memorandum of association. It defines scopes, objectives, functions of the joint stock company.
Different activities are performed in a joint stock company. Harmony and coordination are needed for the effective operation of business activities. The joint stock company is rigidly observed by the government so it must follow rules and regulations of a company. An article of association contains rules and regulations of a company. It regulates the management of the company. The article of association must be submitted to Company Registrar Office for the incorporation of business organization. The article is the outcome of mutual consent of the promotion. When promoters sign in this article then it is submitted to the concerned department of Nepal Government for legal validity.
A prospectus is an invitation to the general public for purchasing the share of the public company. There is no any legal obligation to publish a prospectus in a private company. The prospectus provides a summary of past history. It helps to convert potential shareholders into existing shareholders. In a competitive market, a business must be able to draw the attention of the public.
Prospectus plays the role of advertisement. It plays a vital role to promote the activities of the company. General people/ outsiders observe the prospectus then decide to purchase a share.
In conclusion, a document which is issued to public people for informing about the company is called prospectus.
According to the Company Act, 2053, the prospectus must contain the following matters:
References:
Khanal, Soma Raj, Surendra Thapa Aslami and Sitaram Dhakal.Business Studies.Kathmandu: Taleju Prakashan, 2067.
Pant, Prem R., et al.Business Studies.Kathmandu: Buddha Academic Publishers and Distributors Pvt. Ltd., 2010.
List out the main document of joint stock company.
The main document of joint stock company:
What are the documents of a joint stock company? Discuss the important clauses of the Memorandum of Association.
The main document of joint stock company:
Prospectus plays the role of advertisement. It plays a vital role to promote the activities of the company. General people/ outsiders observe the prospectus then decide to purchase a share.
In conclusion, a document which is issued to public people for informing about the company is called prospectus.
Main clauses/ contents of Memorandum of Association
Discuss the main contents of the Article of the Articles of Association.
Articles of Application is another important document of a company. This document should be attached with the application for registration. Harmony and coordination are needed for the effective operation of business activities. The joint stock company is rigidly observed by the government so it must follow rules and regulations of a company. Article of association contains rules and regulations of a company. It regulates the management of the company. It also mentions the appointment of the board of directors, procedure of holding meetings, transfer of shares, rules regarding loans, rules regarding declaration of dividend etc. Article of association must be submitted to Company Registrar Office for the incorporation of business organization. The article is the outcome of mutual consent of the promotion. When promoters sign in this article then it is submitted to the concerned department of Nepal Government for legal validity.
Contents of Article of Association:
What do you mean by prospectus? Discuss its contents.
A prospectus is an invitation is a general public for purchasing share of the public company. There is no any legal obligation to publish a prospectus in a private company. Prospectus provides a summary of past history. It helps to convert potential shareholders into existing shareholders. It is prepared and circulated basically to inform the public about the company and make people invest money in the company.
Prospectus plays the role of advertisement. It plays a vital role to promote the activities of the company. General people/ outsiders observe the prospectus then decide to purchase a share. The prospectus must be signed and dated by the promoters of the company.
According to the Company Act, 2053, the prospectus must contain the following matters:
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