Grateful 7 speech thanking everyone that has helped.pdf
Formation of a company
1.
2. INTRODUNTION
JOINT STOCK COMPANY
FORMATION OF A COMPANY
- STAGE 1 PROMOTION
- STAGE 2 INCORPORATION
- STAGE 3 SUBSCRIPTIOM OF CAPITAL
- STAGE 4 COMMENCEMENT OF BUSINESS
MEMORANDUM OF ASSOCIATION
3. Company is a association formed for the
purpose of doing a business having a distinct
name and limited liability.
The company is managed on behalf of the
shareholders by the Board of Directors.
4. Joint Stock Company refers to a company having a
joint stock or capital that is divided into units of
ownership interest, such as share which may be
transferred without consent of the other
shareholders.
According to H.L. Haney, “A Joint Stock Company
is a voluntary association of individuals for profit,
having its capital divided into transferrable shares
the ownership of which is the condition of
membership”.
5. Stage 1 – Promotion
PROMOTION of a business refers to all those
activities that are required to be undertaken
performed to establish a new business .
Promotion includes conceiving of ideas ,
ascertaining all basic requirements and
arranging funds to set up the business units.
This whole process is called promotion and
person who does this is called promoter.
6. STAGE 2- INCOPORATION
A joint stock company cannot be started without
registration.
Company comes to existence only when it is
registered with Registrar of a company.
Steps to be followed to register a company are-
1. Approval of name
2. Filing of documents such as MOA and AOA
3. Payment of registration fees
7. STAGE 3- CAPITAL RAISING
Incase of a private limited co. the capital is
raise from members or banks and other sources .
In Public co. the capital is raised from public
through shares.
To issue shares company should draft a
prospectus and get it inspected by SEBI (STOCK
EXCHANGE BOARD OF INDIA) and follow all
guidelines laid down by SEBI.
8. STAGE 4 – COMMENCEMENT OF BUSINESS
Private ltd. Company can start its business
after registration (stage 3).
Public co. needs a certificate called
certificate of commencement of business .
Certificate of commencement is obtained
from registrar of co.
9. It is a document that regulates the external
activities and must be prepared on the
formation of co.
Clauses –
a) NAME CLAUSE
b) SITUATION CLAUSE
c) OBJECT CLAUSE
d) LIABLITY CLASE
e) CAPITAL CLAUSE
f) SUBSCRIPTION CLAUSE