Lecture no.

02

Corporate Governance & Law Preliminary

Abdur Rashid Mirza University of Lahore School of Accountancy and Finance

Chapter 1. Preliminary 1. Company Ordinance General Structure The Law relating to Limited Liability companies is contained in Companies Ordinance, 1984
The Ordinance consists of 16 parts and 8 Schedules The First Schedule consists of five tables dealing with regulations regarding management of different classes of companies The Second Schedule related to prospectus The Third Schedule prescribes the form of annual return The Fourth and Fifth Schedule contain requirements as to balance sheet and Profit and Loss Account of listed and non listed companies.

Chapter 1. Preliminary 1. Company Ordinance General Structure The Law relating to Limited Liability companies is contained in Companies Ordinance, 1984
The Sixth Schedule contains the table of fees The Seventh Schedule sets out the list of repealed enactments The Eighth Schedule includes amendments made in the Securities and Exchange Ordinance 1969.

2.

Chapter 1. Preliminary Application of Ordinance

The Companies Ordinance, 1984 applies to the following Companies formed and registered under the Ordinance Every existing company formed and registered under Companies Act 1913. Companies established outside Pakistan establishing place of business in Pakistan.

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3. Articles of Association The Regulation contained in Table A in the First Schedule.
4. Associated Companies Associated companies means any two or more companies interconnected with each other in a manner specified in section 2(2). 5. Body Corporate Body corporate includes a company incorporated outside of Pakistan.

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6. Chief Executive Officer Chief Executive means an individual who is delegated the management of the Company. 7. Company Company means a company formed and registered under companies ordinance 1982. 8. Debenture Debenture includes debenture stock, bond, term finance certificate or any other security whether or not constituting a charge on the assets of the Company.

Chapter 1. Preliminary
9.Financial Institution Financial Institution means an Institution whose 50% of capital is held by the Federal or Provincial Government.
10.Financial Year Financial Year means a period for which a profit and loss account to be laid before the general meeting is made up whether such period is a year o r not.

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11.Member Member means a subscriber to memorandum, any persons whose name is entered in the register of members.
12.Prespectus Prospectus means any document, notice, circular, advertisement, or other communication, the object of which is to invite offers from public for purchase of share.

Chapter 1. Preliminary
02. What is Company When a company is registered, it is clothed with a legal personality and has the same rights and powers as a human being has. A company can own property, have a banking account, raise loans, incur liabilities and enter into contract. A company is artificial person. It can act only through some human agency called board of Directors. The Control and administer the affairs of the company and act as its agent. They are the agent of members of the company