Company Law – Page 4

MLP – JUL 2020 – L4 – Q1 – Legal Position of Bank in Company Diversification Loan

Advise Agyakrom Bank on its legal position regarding a negotiated loan to Ayensu Books plc for investing in a cinema and leisure complex, considering the company's objects clause, authorization requirements, and potential ultra vires issues.

Question

The main business of Ayensu Books plc is the running of a publishing company in Accra. The objects clause of the company’s regulations includes a power to borrow money as authorized by a general resolution of members. It further states that the directors may do all things that are conducive or incidental to the general business of the company and concludes with a paragraph stating that all the objects are to be regarded as distinct and separate.

The directors decided that the company should invest in a cinema and leisure complex on the Motorway Extension as a means of diversifying and offsetting its risks.

The finance director, acting on behalf of Ayensu Books, negotiated with the manager of Agyakrom Bank plc, the company’s bankers, for the borrowing of GH¢5 million to finance the development. The money is due to reach Addick’s Books bank account next month. In turn, the managing director contracted with Power Construction plc for the construction of the complex, which Power Construction has started to build, but for which it has yet to receive any payment.

Advise Agyakrom Bank on its legal position.

Answer

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Tags: borrowing authority, Company Law, Directors' Powers, Ghana Companies Act 2019, third party protection, ultra vires doctrine
Level: Level 4

Topic: Company formation, Nature of bodies corporate
Series: JULY 2020

PBL – APR 2023 – L1 – Q3 – Veil of Incorporation

Explain the meaning, benefits, and circumstances for lifting the corporate veil.

Question

a. What does the phrase the “veil of incorporation” (corporate veil) mean? (5 marks)

b. What is the benefit of having the “veil of incorporation”? (10 marks) c. When, (if at all) may the “veil” be removed? (5 marks)

Answer

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Tags: Company Law, Corporate Veil, Incorporation, Lifting the Veil, Limited Liability
Level: Level 1

Topic: Contract Law
Series: APR 2023

PBL – APR 2016 – L1 – Q5 – Private vs Public Limited Liability Companies and Conversion

Differences between a private limited liability company and a public limited liability company, and the process for converting a private company to a public one.

Question

(a) State the difference between a Private Limited Liability Company and a Public Limited Liability Company (b) Briefly describe how a Private Limited Liability company may be converted into a Public Limited Liability Company.

Answer

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Tags: Banking Customers, Borrowing Capacity, Company Law, Conversion Process, Corporate Governance, Differences, Ghana Companies Act, Private Limited Company, Public Limited Company
Level: Level 1

Topic: Contract Law
Series: APRIL 2016

FR – Nov 2023 – L2 – Q7a – Regulatory Framework for Financial Reporting

Discusses main sources of financial reporting regulations and reasons for regulatory practices.

Question

Within the context of financial reporting and regulatory frameworks:

i. Discuss the main sources of regulations. (3 Marks)
ii. Discuss TWO reasons why financial reporting practice should be regulated. (2 Marks)

Answer

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Tags: Accounting Standards, Company Law, Financial Reporting, Regulations, Regulatory Rationale, Stock Exchange
Level: Level 2

Topic: Regulatory Framework for Financial Reporting

BL – Nov 2020 – L1 – SB – Q1d – Company Law

List powers exercised by the Annual General Meeting (AGM) of a company.

Question

One of the two organs of a company is the general meeting of members.

Required:
State FOUR powers of the Annual General Meeting.

Answer

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Tags: Annual General Meeting, Company Law, Corporate Powers, Shareholder Rights
Level: Level 1

Topic: Company Law
Series: NOV 2020

BL – Nov 2020 – L1 – SA – Q4 – Company Law

Objective question testing knowledge on instances where a court may disregard corporate personality.

Question

4. A situation in which the court would disregard the distinction between the personalities of a company and its members is
A. Subrogation
B. Alienation
C. Lifting the veil of incorporation
D. Disregarding the law
E. The rule in Foss vs. Habbotle

Answer

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Tags: Company Law, Corporate Personality, Legal Principles, Veil of Incorporation
Level: Level 1

Topic: Company Law
Series: NOV 2020

BL – May 2012 – L1 – SB – Q6B – Company Law

Explain two fiduciary duties of a company director.

Question

Directors of companies are placed in special and unique positions. Their status imposes certain duties on them, and these include fiduciary duties.

Required:
Explain any TWO fiduciary duties of a company director.

Answer

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Tags: Business Law, Company Law, Directors' Duties
Level: Level 1

Topic: Company Law
Series: MAY 2012

BL – May 2012 – L1 – SB – Q6A – Company Law

Advise on the importance of filing annual returns for Xeyoze Limited.

Question

Xeyoze Limited was incorporated by the Corporate Affairs Commission on February 1, 2010. On March 1, 2011, the company bid for a contract to rehabilitate one of the nation’s oil refineries. This contract attracted scores of bidders because it was seen as a very lucrative one. A rival bidder objected to the competence of Xeyoze Limited to bid for the contract on the ground that an investigation at the Corporate Affairs Commission revealed that the company has not filed its annual returns.

Required: Advise Xeyoze Limited on the following:

(i) The importance of filing annual returns. (2 Marks)
(ii) The period within which the annual returns must be filed. (2 Marks)
(iii) The consequences of failure to file annual returns. (2 Marks)
(iv) Whether it is optional to file the annual returns or not (2 Marks)
(v) What is your advice if the contract was bid for on October 1, 2010? (3 Marks)

Answer

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Tags: Business Law, Company Law, Compliance
Level: Level 1

Topic: Company Law
Series: MAY 2012

BL – May 2012 – L1 – SB – Q1B – Company Law

Advise Halidu on transferring shares to raise money for school fees.

Question

Halidu holds one million shares in Realshares Nigeria Plc. Zaidi, his son, has just returned from the University of Basel because he could not pay school fees. Halidu is cash-strapped and wants to know whether he could transfer his shares to someone else to raise money to pay the fees.
Required: Advise Halidu, stating the statutory conditions by which he could transfer his shares. (5 Marks)

Answer

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Tags: Business Law, Company Law, Share Transfer
Level: Level 1

Topic: Company Law
Series: MAY 2012

BL – May 2012 – L1 – SA – Q18 – Company Law

Identify the concept that allows a company to continue existing despite changes in ownership.

Question

The fact that a company cannot die connotes that it has:

Answer

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Tags: Business Law, Company Law, Perpetual Succession
Level: Level 1

Topic: Company Law
Series: MAY 2012

BL – May 2013 – L1 – SA – Q16 – Company Law

This question tests the understanding of the time frame within which a company must notify a transferee of refusal to register shares.

Question

Within how many months must a company that refuses to register a transfer of any shares send the notice of the refusal to the transferee?

A. One
B. Two
C. Three
D. Four
E. Five

Answer

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Tags: Company Law, Notice of Refusal, Share Transfer
Level: Level 1

Topic: Company Law
Series: MAY 2013

BL – May 2013 – L1 – SA – Q15 – Company Law

This question tests the maximum number of days for which a proposed company name can be reserved by the Corporate Affairs Commission.

Question

The maximum number of days for which the name of a company that is proposed to be registered shall be reserved by the Corporate Affairs Commission is:

A. 30
B. 45
C. 60
D. 75
E. 90

Answer

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Tags: Company Law, Corporate Affairs Commission, Name Reservation
Level: Level 1

Topic: Company Law
Series: MAY 2013

BL – May 2014 – L1 – SB – Q5 – Corporate Governance

Discussing requirements for incorporation and the implications of proposed company names.

Question

a. Jossy is a cabinet maker based on Victoria Island, Lagos, where he has a lucrative business. Jossy is proposing to expand his business and wants to invite James to form a Limited Liability Company, using the name Jossy James Limited.

You are required to:
i. State FIVE documents that must be filed for the incorporation of the company; and (5 Marks)
ii. Advise the parties on whether the proposed name, Jossy James Limited is appropriate and, state FOUR prohibited or restricted company names. (5 Marks)

b. State FIVE advantages of a Limited Liability Company over a Partnership. (5 Marks)

Answer

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Tags: Company Law, Company Secretary, Incorporation
Level: Level 1

Topic: Corporate Governance
Series: MAY 2014

BL – May 2014 – L1 – SA – Q13 – Company Law

Identifying the type of winding up ordered by the court.

Question

The type of winding up of a company that is ordered by the court is known as ____________ winding up.

Answer

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Tags: Company Law, Court Orders, Winding-up
Level: Level 1

Topic: Company Law
Series: MAY 2014

BL – May 2014 – L1 – SA – Q11 – Company Law

Identifying the officer responsible for examining a company's financial books.

Question

The officer of a company who formally examines and verifies the financial books of the company is the ____________.

Answer

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Tags: Company Law, Corporate Governance, Financial Examination
Level: Level 1

Topic: Company Law
Series: MAY 2014

BL – Nov 2015 – L2 – SB – Q2c – Company Law

Describe two ways a company can remove its auditor.

Question

Explain briefly TWO ways of removing an auditor of a company.
(5 Marks)

Answer

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Tags: Auditors, Company Law, Corporate Governance, Removal of Auditor
Level: Level 1

Topic: Company Law

BL – Nov 2015 – L2 – SB – Q2b – Company Law

Explain two ways shareholders can influence the composition of the board and decisions in a company.

Question

In a Limited Liability Company, there could be no membership of the Board of Directors except by the actions of shareholders.

Required:

Explain TWO ways by which shareholders could influence the composition of the Board and decisions of the company.
(5 Marks)

Answer

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Tags: Board of Directors, Company Law, Corporate Governance, Shareholders
Level: Level 1

Topic: Company Law
Series: NOV 2015

BL – May 2014 – L1 – SA – Q13 – Company Law

Understanding the required documents for company incorporation.

Question

The persons proposing to form a company are required to prepare and present documents to the Corporate Affairs Commission for registration. Which of the following documents states the objects of the proposed company?
A. Statutory declaration of compliance sworn to by a legal practitioner
B. Statement of the authorised or minimum share capital
C. The Memorandum of Association
D. The Articles of Association
E. Written consent of the first directors

Answer

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Tags: Company Law, Incorporation, Required Documents
Level: Level 1

Topic: Company Law
Series: MAY 2014

BL – Nov 2015 – L2 – SB – Q1b – Company Law

Describe four circumstances in which a director must vacate office in a company.

Question

Directors of a company are the executives that direct the affairs of the company. Thus, such an important position must have certain attributes and be guided by prescribed rules.

Required:

Explain briefly FOUR circumstances under which a person must vacate office as director of a company.
(8 Marks)

Answer

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Tags: Company Law, Corporate Governance, Directors, Removal of Directors
Level: Level 1

Topic: Company Law
Series: NOV 2015

FA – May 2014 – L1 – SA – Q4 – Regulatory Environment of Accounting

Identifies the document governing a company's relationship with third parties.

Question

The document which discloses the conditions that govern a company’s relationship with third parties is called
A. Articles of Association
B. Loan notes
C. Register of Members
D. Memorandum of Association
E. Memorandum of Understanding

Answer

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Tags: Articles of Association, Company Law, Corporate Documentation, Memorandum
Level: Level 1

Topic: Regulatory Environment of Accounting
Series: MAY 2014

Question Tag: Company Law

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MLP – JUL 2020 – L4 – Q1 – Legal Position of Bank in Company Diversification Loan

Advise Agyakrom Bank on its legal position regarding a negotiated loan to Ayensu Books plc for investing in a cinema and leisure complex, considering the company's objects clause, authorization requirements, and potential ultra vires issues.

You're reporting an error for "MLP – JUL 2020 – L4 – Q1 – Legal Position of Bank in Company Diversification Loan"

PBL – APR 2023 – L1 – Q3 – Veil of Incorporation

Explain the meaning, benefits, and circumstances for lifting the corporate veil.

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PBL – APR 2016 – L1 – Q5 – Private vs Public Limited Liability Companies and Conversion

Differences between a private limited liability company and a public limited liability company, and the process for converting a private company to a public one.

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FR – Nov 2023 – L2 – Q7a – Regulatory Framework for Financial Reporting

Discusses main sources of financial reporting regulations and reasons for regulatory practices.

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BL – Nov 2020 – L1 – SB – Q1d – Company Law

List powers exercised by the Annual General Meeting (AGM) of a company.

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BL – Nov 2020 – L1 – SA – Q4 – Company Law

Objective question testing knowledge on instances where a court may disregard corporate personality.

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BL – May 2012 – L1 – SB – Q6B – Company Law

Explain two fiduciary duties of a company director.

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BL – May 2012 – L1 – SB – Q6A – Company Law

Advise on the importance of filing annual returns for Xeyoze Limited.

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BL – May 2012 – L1 – SB – Q1B – Company Law

Advise Halidu on transferring shares to raise money for school fees.

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BL – May 2012 – L1 – SA – Q18 – Company Law

Identify the concept that allows a company to continue existing despite changes in ownership.

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BL – May 2013 – L1 – SA – Q16 – Company Law

This question tests the understanding of the time frame within which a company must notify a transferee of refusal to register shares.

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BL – May 2013 – L1 – SA – Q15 – Company Law

This question tests the maximum number of days for which a proposed company name can be reserved by the Corporate Affairs Commission.

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BL – May 2014 – L1 – SB – Q5 – Corporate Governance

Discussing requirements for incorporation and the implications of proposed company names.

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BL – May 2014 – L1 – SA – Q13 – Company Law

Identifying the type of winding up ordered by the court.

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BL – May 2014 – L1 – SA – Q11 – Company Law

Identifying the officer responsible for examining a company's financial books.

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BL – Nov 2015 – L2 – SB – Q2c – Company Law

Describe two ways a company can remove its auditor.

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BL – Nov 2015 – L2 – SB – Q2b – Company Law

Explain two ways shareholders can influence the composition of the board and decisions in a company.

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BL – May 2014 – L1 – SA – Q13 – Company Law

Understanding the required documents for company incorporation.

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BL – Nov 2015 – L2 – SB – Q1b – Company Law

Describe four circumstances in which a director must vacate office in a company.

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FA – May 2014 – L1 – SA – Q4 – Regulatory Environment of Accounting

Identifies the document governing a company's relationship with third parties.

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