Definitions

JOINT STOCK Definitions
5. TRANSFERABILITY OF SHARES:
The shareholders of a company have full freedom to transfer their shares to consulting other shareholders.
6. SEPARATION OF OWNERSHIP FROM MANAGEMENT:
The shareholders, who are the owners of the company, are large in number. They a over the country. Being absentee owners, they cannot manage the affairs of the company. Tr. therefore, elect Board of Directors in the annual general meeting and entrust the mani company to them. The ownership and management of the company are thus in two separate ri
7. STATUTORY REGULATIONS:
A company right from its inception, has to comply with a number of statutory requ also to submit returns and report during its lifetime to the Government.
8. COMMON SEAL:
Since the company is an artificial person created by law, it therefore cannot sign itself. The common seal with the name of the company engraved on it is, therefore, used as its signature.
9. RIGIDITY OF OBJECTS:
In a company form of organization, the objects and powers of the company art memorandum of association of the company. A change in the object and powers of a comp made after complying with the relevant provisions of the Companies Ordinance.
KINDS OF COMPANIES
There are four kinds of companies registered under companies ordinance, 1984. (1) COMPANY LIMITED BY SHARES:
This is the principal form of company which is registered with the registrar of joint under the Companies Ordinance. In a company limited by shares, the capital is divided i shares. A person who buys one or more than one shares becomes a member of the company be freely transferred and sold. The liability of the members is limited to the amount if an shares held by them. A company limited by shares is further divided into (a) private c Public company.
(a) Private Limited Company:
According to the' Companies Ordinance 1984 it can be formed (a) at least by its total membership cannot exceed 50. (b) The company by its articles also rest transfer its shares, (c) It also prohibits any invitation to the public to invest their mo debentures of the company.
(b) Public Limited Company:
It can be formed by at least seven members and there is no limit to the maximum nu limited company invites applications from investors through advertisement in the newspi details of the objects, share capital, method of applying for the procedure to be adopted fo
the shares etc.