Legal Aspects of Finance - 13
True/False
Question Preference share holders are creditors of the company.
Correct Answer False
True/False
Question After completion of Ordinary business other business is
transacted at Extra ordinary General Meeting.
Correct Answer False
Multiple Choice Multiple Answer
Question Form No. 1 can be signed by :-
Correct Answer Chartered Accountant , Cost & Works Accountant , Advocate
Multiple Choice Multiple Answer
Question Different classes of shareholders' meetings are :-
Correct Answer Annual General Meeting , Statutory Meeting , Extra-Ordinary
General Meeting
Select The Blank
Question SIA/FIPB approval is necessary where sectoral limits are
________.
Correct Answer Exceeded
True/False
Question Every company taking loan from the bank or Financial Institution
has to create a charge on the assets.
Correct Answer True
Multiple Choice Multiple Answer
Question FDI prohibited activities are :-
Correct Answer Retail trading , Gambling & betting , Housing & real estate
Multiple Choice Multiple Answer
Question Sole selling agent may be :-Correct Answer An Individual , A firm , A Body corporate
Multiple Choice Multiple Answer
Question Who has not prescribed particular set of documentation for
current account remittances?
Correct Answer RBI , Central Govt.
Multiple Choice Multiple Answer
Question Public limited company's directors have following conditions :-
Correct Answer Minimum number is three , Should be individuals , Have sound
mind
Select The Blank
Question A ________ shall not be made for the appointment of two or
more persons as directors of the company by single resolution in
any general meeting of public company, unless resolution has
been agreed by meeting without any vote being given against it.
Correct Answer Motion
Multiple Choice Single Answer
Question When was the minimum wages act passed ?
Correct Answer 1948
Select The Blank
Question All transactions of the ________ with the company shall be
disclosed in the annual report.
Correct Answer Non executive chairman
Multiple Choice Multiple Answer
Question Object Clauses are divided into :-
Correct Answer Main Object , Object incidental or ancillary to Main , Other
Objects
Select The Blank
Question ________shall certify that they have reviewed the balance sheet
and profit and loss account.
Correct Answer CEO
True/False
Question Wages does not include an amenity or service or special order of
the appropriate government.
Correct Answer True
Select The Blank
Question As per section ________ it is obligatory on every person
responsible for payment.
Correct Answer 4
Multiple Choice Multiple Answer
Question What is the manner of fixation of minimum wages?
Correct Answer Time work known as minimum time rate , Piece work known as
minimum piece rate , Guaranteed time rate for those employed
in piece work for the purpose of securing to such employees a
minimum rate of wages on time work basis
Multiple Choice Single Answer
Question What does the minimum wages act determine ?
Correct Answer The minimum wages in industries specified in the schedule
Select The Blank
Question Under the industrial disputes act 1947________is an appropriate
government.
Correct Answer Central government
Multiple Choice Single Answer
Question Every auditor who has in receipt from the company of the
intimation of his appointment, has to inform Registrar in writing
that he has accepted or refused to accept the appointment within
Correct Answer 30 Days
Match The Following
Question -Correct Answer
Capital Account Guarantee by a person
resident
Living Expenses- Current Account
Deposits -Capital Account
The Adjudicating Authority -Power of Classification
Multiple Choice Single Answer
Question Authentication of Annual Accounts means :-
Correct Answer Correctness of the accounts
True/False
Question Every company shall have a qualified and independent audit
committee.
Correct Answer True
Multiple Choice Single Answer
Question What does salary or wage include?
Correct Answer Dearness allowance
Multiple Choice Single Answer
Question At any general meeting, unless a poll is demanded, resolution
put to vote is decided by :-
Correct Answer Show of hands
Multiple Choice Multiple Answer
Question What is the board procedure ?
Correct Answer Meeting to be held 4 times in a year , Should not be a gap of
more than 4 months between 2 meetings , Minimum information
should be made available
Multiple Choice Single Answer
Question Explanatory Statement should be annexed to Notice for :-
Correct Answer Special business
Select The Blank
Question The auditor has to give his report that the accounts of the
company gives ________.
Correct Answer True & Fair view
Multiple Choice Single Answer
Question How would you define salary or wage?
Correct Answer All remuneration other than in respect of overtime work of the
work done in such employment
Match The Following
Question- Correct Answer
Notice -Circulation for day, time of
meeting
Sole selling agent- Have exclusive right to
sale for company in
specified area
Audit committee -Appointed for specific
purpose related to audit
Quorum- Minimum required
persons for meeting
Multiple Choice Single Answer
Question Application for Incorporation of the Company is to be submitted
to :-
Correct Answer Registrar of Companies
True/False
Question There is no quorum for board meeting
Correct Answer False
Multiple Choice Single Answer
Question What amount of paid up capital should the listed companies
have to comply with the provisions of Clause 49 of listing
agreement ?
Correct Answer Rs 3 crores
True/False
Question Authorized dealer is required to avail license under the exim
policy in force.
Correct Answer True
Select The Blank
Question The detention period where the amount of penalty is greater than
10 million is ________.
Correct Answer 3 years
Multiple Choice Multiple Answer
Question What is the role of the audit committee?
Correct Answer Review the annual financial statements , Recommending and
appointment of external auditors , Reviewing the company's
financial and risk management policies
Multiple Choice Single Answer
Question After incorporation of the company, the first auditor is generally
appointed within :-
Correct Answer One Month
True/False
Question Wages includes any remuneration payable under any award or
settlement between the parties or order of court.
Correct Answer True
Multiple Choice Multiple Answer
Question Particulars of charge under sec.125 contain :-
Correct Answer Date & description of the instrument creating the charge ,
Amount secured by the charge , Short particulars of the asset to
be charged
True/False
Question The act is undoubtedly a welfare legislation in favour of workers
and more than an essential measure for economic upliftment of
the workers in the sweated industries.
Correct Answer True
Select The Blank
Question ________ is one of the critical matter which should be decided
by the postal ballot.
Correct Answer Corporate restructuring
Multiple Choice Single Answer
Question If an auditor after his appointment becomes subject to any of the
disqualifications, it is treated that the office is :-
Correct Answer Vacated
Select The Blank
Question Free selling/drawl of foreign exchange to authorized dealer(AD)
for ________.
Correct Answer Current account
True/False
Question Directors' Report may contain details/ state of affairs of its
subsidiaries.
Correct Answer True
Select The Blank
Question The act defines ________ in private sector and public sector.
Correct Answer Establishment
Multiple Choice Multiple Answer
Question The Indian company may issue bonus shares to its non resident
shareholders subject to :-
Correct Answer Held by non resident shareholder , As per acquisition , In the
Form of FC-GPR
Legal Aspects of Finance - 12
Multiple Choice Single Answer
Question For which activity FDI is not prohibited?
Correct Answer Insurance
Multiple Choice Multiple Answer
Question Remuneration to the director may be paid :-
Correct Answer Monthly , Quarterly , Annually
Multiple Choice Single Answer
Question Payment of wages act came into existence :-
Correct Answer To ensure regular and timely payment of wages to employed
persons
Multiple Choice Single Answer
Question To safeguard the interest of the company or its shareholders or
the public interest, the central government, may appoint such
number of person as directors to hold office for a period not
exceeding :-
Correct Answer 3 years
Multiple Choice Multiple Answer
Question Sole selling agent may be :-
Correct Answer An Individual , A firm , A Body corporate
Multiple Choice Single Answer
Question When was the factories act passed?
Correct Answer In 1948
Multiple Choice Single Answer
Question Number of shareholders entitled to requisition a meeting shall be
carrying
Correct Answer Not less than 10 per cent of voting power
True/False
Question Bonus is an ex gratia payment.
Correct Answer False
Multiple Choice Single Answer
Question Compliance Report is signed by :-
Correct Answer Company Secretary in practice
Multiple Choice Single Answer
Question The responsibility of placing the annual accounts before the
AGM is on
Correct Answer Board of Directors
True/False
Question Every company shall keep a register showing the particulars in
respect of every loan or investment made, guarantee given or
security provided.
Correct Answer True
Multiple Choice Multiple Answer
Question Following are the points related to Qualification share that every
director has to take :-
Correct Answer Within two months of date of appointment , If fails to obtain then
he has to resign from the post , Minimum Share value Rs.5000/-
True/False
Question The loan to any body corporate shall be made at the rate of
interest not less than that prevailing bank rate as may be
prescribed by Reserve Bank of India.
Correct Answer True
True/False
Question An independent Director is not an executive director of a
Company.
Correct Answer False
True/False
Question Owned foreign exchange is not permitted.
Correct Answer False
Select The Blank
Question Copies of annual accounts are to be filed within ________ days
from AGM with ROC.
Correct Answer 30 days
True/False
Question A non executive director is not a substantial shareholder of the
company.
Correct Answer True
Match The Following
Question- Correct Answer
Bifurcation Voted for/ against Chairman
Ordinary resolution- Simple majority
Requisition of members -Not less than 5 % voting
power
Special resolution Form 23 Voted for/ against
Select The Blank
Question ________ shall lay before the AGM, the statement of Income &
Expenditure in place of Profit & Loss a/c.
Correct Answer Charitable Trust
Your Answer Charitable Trust
Multiple Choice Multiple Answer
Question What are the powers of the audit committee?
Correct Answer To investigate any activity within its terms of reference , To seek
information from any employee , To obtain outside legal or
professional advice
Select The Blank
Question No loan or investment shall be made or guarantee given by
company unless ________ is passed at the meeting by the
board.
Correct Answer Resolution
Multiple Choice Multiple Answer
Question Which committees are considered for calculating the limit of the
companies
Correct Answer Audit committees , Remuneration Committee , Shareholders
Grievance Committee
Select The Blank
Question The minimum wages to the obligations created by the
convention no 26 of ________.
Correct Answer International labour organisation
True/False
Question A temporary workman is not entitled to bonus though he works
for a few days in the organisation.
Correct Answer False
Multiple Choice Multiple Answer
Question A person can not be appointed as director of the company if :-
Correct Answer He is found to be of unsound mind , He is declared as an
insolvent , He has not taken qualification shares
Multiple Choice Single Answer
Question A company which restricts the right to transfer its shares is :-
Correct Answer Private Ltd. Company
Match The Following
Question -Correct Answer
Interim Dividend- Board of Directors
Shorter notice for AGM -Private Limited Company ROC
Books of Account -Form 23AA
Accounting Standards- National Advisory
Committee
Multiple Choice Multiple Answer
Question Preference shares can be :-
Correct Answer Cumulative redeemable , Non- cumulative redeemable ,
Participatory
True/False
Question Only individuals can be appointed as directors of the company.
Correct Answer True
Multiple Choice Multiple Answer
Question Director can be appointed without counting the number in :-
Correct Answer Private limited company , Unlimited company , Charitable
association
Multiple Choice Multiple Answer
Question Who is not entitled to bonus?
Correct Answer An apprentice , Employee employed through contractors
Select The Blank
Question Subject to other provisions of this act every employer shall be
bound to pay every employee in respect of the accounting year
commencing on any day in the year ________.
Correct Answer 1979
Multiple Choice Single Answer
Question To whom does the payment of wages act apply to ?
Correct Answer Persons employed in any factory
Select The Blank
Question Under the industrial disputes act 1947________is an appropriate
government.
Correct Answer Central government
Multiple Choice Single Answer
Question When was the minimum wages act passed ?
Correct Answer 1948
True/False
Question Retiring director may be eligible for reappointment.
Correct Answer True
Multiple Choice Single Answer
Question In which case did the Bombay high court observe the general
purpose of the act?
Correct Answer Arvind mills ltd case
True/False
Question After completion of Ordinary business other business is
transacted at Extra ordinary General Meeting.
Correct Answer False
Select The Blank
Question ________shall certify that they have reviewed the balance sheet
and profit and loss account.
Correct Answer
Answer CEO
Select The Blank
Question ________ includes legal representative of deceased employer.
Correct Answer Employer
Select The Blank
Question Any payment in respect on ________ can be deducted from the
wages of an employed person.
Correct Answer Fidelity guarantee bond
Select The Blank
Question A member shall have right to apply for operations and
mismanagement of the company provided application is made
by members not less than ________ or by the members holding
not less than one tenth of total number of shares in the share
capital of the company.
Correct Answer 100
Select The Blank
Question A statement of all transactions with the related parties including
the basis shall be placed before the ________.
Correct Answer Audit committee
Multiple Choice Multiple Answer
Question The board of directors shall exercise these powers only at board
meetings :-
Correct Answer Power to make calls on shares , Power to issue debentures ,
Power to borrow money
Multiple Choice Single Answer
Question Explanatory Statement should be annexed to Notice for :-
Correct Answer Special business
Multiple Choice Multiple Answer
Question What is the board procedure ?
Correct Answer Meeting to be held 4 times in a year , Should not be a gap of
more than 4 months between 2 meetings , Minimum information
should be made available
Multiple Choice Multiple Answer
Question Conditions on borrowings by PIO are :-
Correct Answer Non-repatriation basis , Loan by inward remittance , Account by
lender in India
Legal Aspects of Finance - 11
Multiple Choice Multiple Answer
Question Board may by resolution passed at the meeting delegate the
powers to :-
Correct Answer Manager , Committee of directors , Managing director
Multiple Choice Single Answer
Question What is the optimum combination of Board of Directors?
Correct Answer Managing Directors and Secretary
Select The Blank
Question Copies of annual accounts are to be filed within ________ days
from AGM with ROC.
Correct Answer 30 days
Select The Blank
Question First AGM should be held within ________ from closure of
financial year.
Correct Answer 9 months
True/False
Question Acquiring foreign security on gift is allowed.
Correct Answer True
Multiple Choice Multiple Answer
Question Briefly describe the scheme of the bonus act :-
Correct Answer To impose statutory liability upon every employer to pay bonus
to employees , To define principle of payment of bonus as per
the prescribed formula , To provide payment for minimum and
maximum bonus and link the scheme for set off and set on
Multiple Choice Multiple Answer
Question Remuneration to the director may be paid :-
Correct Answer Monthly , Quarterly , Annually
Multiple Choice Single Answer
Question Single director can sign the annual accounts if :-
Correct Answer Only one director in India for the time being
Select The Blank
Question If an employer derives profit in any of the first ________ years
he has to pay bonus for that year.
Correct Answer 5
Multiple Choice Single Answer
Question Define an employed person under section 2 of the act.
Correct Answer Includes legal representative of a deceased employed person
True/False
Question No person can be appointed as an auditor of the company who
is in full time employment.
Correct Answer True
True/False
Question Wages includes the value of any house accommodation or
supply of light and water.
Correct Answer False
Multiple Choice Multiple Answer
Question Retiring director shall be deemed to be reappointed unless :-
Correct Answer He has expressed his unwillingness to be re-appointed , He is
disqualified for appointment , Resolution for reappointment has
been put to vote & lost
Select The Blank
Question It is the primary ________ of the company to file the documets of
creation of charge.
Correct Answer Responsibility
Multiple Choice Multiple Answer
Question Who is an independent director?
Correct Answer Non executive director , Who receives director remuneration ,
Who is not related to the promoters
Multiple Choice Single Answer
Question Surrender of foreign exchange is regulated as per :-
Correct Answer RBI Norms
Select The Blank
Question For making alterations before ROC, ________ is required.
Correct Answer Power of Attorney
True/False
Question Senior managers are members of management, one level below
the executive director.
Correct Answer True
Multiple Choice Single Answer
Question Which companies have to comply with the provisions of Clause
49 of listing agreement ?
Correct Answer Listed Companies
Multiple Choice Single Answer
Question What right does the payment of bonus act give ?
Correct Answer Statutory right to share in profits
Multiple Choice Multiple Answer
Question Indian IT. companies are allowed to acquire shares in foreign
companies on following conditions :-
Correct Answer Investment limit of US $ 100 Million , Investment 10 times the
export earnings
Select The Blank
Question Foreign companies may open Project Office in India after
approval of ________.
Correct Answer RBI
Multiple Choice Multiple Answer
Question Directors' Responsibility Statement refers to :-
Correct Answer Going concern , Accounting policies , Accounting standards
Multiple Choice Single Answer
Question s
Correct Answer In 1936
Multiple Choice Single Answer
Question Every member of a company limited by shares and holding any
equity share capital therein shall have :-
Correct Answer Right to vote
Multiple Choice Single Answer
Question Which person is responsible for he payment of wages act ?
Correct Answer Managers
True/False
Question Foreign technical collaborations are permitted.
Correct Answer False
Multiple Choice Single Answer
Question What is the minimum salary under which the persons are
covered in this act?
Correct Answer Less than Rs 1600
True/False
Question Form no 17 &13 are to be filed when the entire loan amount is
repaid.
Correct Answer True
Multiple Choice Multiple Answer
Question Section 24 provides bar to entertain suits by the court for
recovery of wages in so far as the sum claimed falls within which
of the following categories :-
Correct Answer For which any application claim has already been presented ,
Direction of claim already given' , Amount adjudged is not due to
penalty
Multiple Choice Single Answer
Question Any contravention of provisions of FEMA will attract penalty upto
:-
Correct Answer Rs. 200000
Multiple Choice Single Answer
Question The responsibility of placing the annual accounts before the
AGM is on
Correct Answer Board of Directors
Select The Blank
Question The form should be filled within ________ days from the date of
execution of document.
Correct Answer 30 days
True/False
Question A proxy can appoint another proxy.
Correct Answer False
Multiple Choice Single Answer
Question In which case did the Bombay high court observe the general
purpose of the act?
Correct Answer Arvind mills ltd case
Multiple Choice Single Answer
Question To whom does the payment of wages act apply to ?
Correct Answer Persons employed in any factory
Multiple Choice Multiple Answer
Question Which committees are considered for calculating the limit of the
companies
Correct Answer Audit committees , Remuneration Committee , Shareholders
Grievance Committee
Select The Blank
Question A member shall have right to apply for operations and
mismanagement of the company provided application is made
by members not less than ________ or by the members holding
not less than one tenth of total number of shares in the share
capital of the company.
Correct Answer 100
True/False
Question Sectoral cap on investment by person resident outside India on
Mass rapid Transport is 50%.
Correct Answer False
True/False
Question In case of Postal Ballot, result is announced through post.
Correct Answer False
Select The Blank
Question Payment of ________ requires registration from RBI.
Correct Answer Royalty
Select The Blank
Question ________ of the company has a right to take inspection of the
books of account.
Correct Answer Any Director
Select The Blank
Question The definition of ECB in India is partly in alignment with
________ Act.
Correct Answer FERA
Multiple Choice Multiple Answer
Question Following have the right to inspect books of account :-
Correct Answer Any Director of the company , Officer of SEBI (if authorised) ,
Authorised officer of Government
Match The Following
Question- Correct Answer
dismissed employee for
bonus-
Gannon India vs. niranjan
das
part time employee
entitled to bonus-
automobile karmachari
sang vs. industrial tribunal
1970
retrenched employee
entitled for bonus'-
east Asiatic company vs.
industrial tribunal 1961
probationer for bonus'- bank of madura vs.
employees union 1970
Multiple Choice Multiple Answer
Question Borrowings for Indian companies are for :-
Correct Answer In Rupees , On repatriation , Non-repatriation
Match The Following
Question -Correct Answer
Qualification share- Minimum number of
shares that every director
has to take
Director -Employee of the company
Vacancy- Created due to resignation
of director
Rotation -Specific time interval
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