Which statement is correct in respect of a private company?
Answer & explanation
Correct answer: option 1
A substantial number of entrepreneurs prefer to form a private company because of the following important privileges:
1) Only two members are required to form a private company.
2) Only two directors are required to constitute the quorum to validate the proceedings of the meetings.
3) Such company can file a statement in lieu of prospectus with the Registrar of Companies.
4) It can commence its business immediately after incorporation.
5) Holding of a statutory meeting or filing of a statutory report is required by a private company.
6) A non-member cannot inspect the copies of the profit and loss A/c filed with the Registrar.
7) Limit on payment of maximum managerial remuneration does not apply to a private company.
8) Restrictions on appointment and reappointment of managing director do not apply.
9) Maintaining of index of members is not required by a private company.
10) Directors of the private company need not have qualification shares.
1) Only two members are required to form a private company.
2) Only two directors are required to constitute the quorum to validate the proceedings of the meetings.
3) Such company can file a statement in lieu of prospectus with the Registrar of Companies.
4) It can commence its business immediately after incorporation.
5) Holding of a statutory meeting or filing of a statutory report is required by a private company.
6) A non-member cannot inspect the copies of the profit and loss A/c filed with the Registrar.
7) Limit on payment of maximum managerial remuneration does not apply to a private company.
8) Restrictions on appointment and reappointment of managing director do not apply.
9) Maintaining of index of members is not required by a private company.
10) Directors of the private company need not have qualification shares.