Legal Aspect of Finance -1

8/6/2019 Legal Aspect of Finance -1

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LIST OF ATTEMPTED QUESTIONS AND ANSWERS

Select The Blank

Question Copies of annual accounts are to be filed within ________ days from

AGM with ROC.

Correct Answer 30 days

Your Answer 90 days

True/False

Question Sectoral cap on investment by person resident outside India on Mass rapid

Transport is 50%.

Correct Answer False

Your Answer True

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 5Your Answer 5

Multiple Choice Single Answer

Question A director has to vacate his office, if he is adjudged as :-

Correct Answer Insolvent

Your Answer Insolvent


Question Define an employee under section 2 (13) :-

Correct Answer Person employed with salary exceeding Rs 3500

Your Answer Person employed with salary exceeding Rs 2500

True/FalseQuestion Authorized dealer is required to avail license under the exim policy in

force.

Correct Answer True

Your Answer True


Question The earlier "Fast Track" investments route has been replaced by?

Correct Answer Automatic

Your Answer Automatic


Question The quorum for the board meeting is one third of the total strength of the

board or two whichever is :-

Correct Answer More

Your Answer More


Question Payment ofwages act came into existence :-

Correct Answer To ensure regular and timely payment of wages to employed


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persons

Your Answer To pay wages after a years time

Select The Blank

Question The recommendations of audit committee relating to financial

management shall be ________.

Correct Answer Binding

Your Answer Binding

Select The Blank

Question The minimum wages to the obligations created by the convention no 26 of

________.

Correct Answer International labour organisation

Your Answer International labour organisation

Multiple Choice Multiple Answer

Question Borrowings for Indian companies are for :-

Correct Answer On repatriation , Non-repatriation , In RupeesYour Answer In Rupees , On repatriation , On Payments made


Question What do you mean by wages?

Correct Answer Remuneration by way of salaries , Allowances , Expressed in terms

of money

Your Answer Remuneration by way of salaries , Allowances , Expressed in terms

of money


Question To whom does the payment of wages act apply to ?

Correct Answer Persons employed in any factoryYour Answer Persons employed in any factory


Question What is the minimum salary under which the persons are covered in this

act?

Correct Answer Less than Rs 1600

Your Answer Less than Rs 1600


Question Define an employed person under section 2 ofthe act.

Correct Answer Includes legal representative of a deceased employed person

Your Answer Includes legal representative of a deceased employed person


Question Following are the points related to Qualification share that every director

has to take :-

Correct Answer Minimum Share value Rs.5000/- , Within two months of date of

appointment , If fails to obtain then he has to resign from the post

Your Answer Minimum Share value Rs.5000/- , Within two months of date of


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appointment , If fails to obtain then he has to resign from the post

Match The Following

Question Correct Answer Your Answer

Interim Dividend Board of Directors Ordinary Resolution

Reduction of capital Special Resolution National Advisory Committee

Appointment of Managing Director Ordinary Resolution Board of Directors

Accounting StandardsNational Advisory Committee Special Resolution

True/False

Question A General Meeting may also be called by giving shorter notice than 21

days.

Correct Answer True

Your Answer True


Question Board's Report shall include :-

Correct Answer Dividend recommended , Financial position of the company ,Amounts transferred to Reserves

Your Answer Dividend recommended , Taxes paid , Financial position of the

company

Select The Blank

Question As per section 5 in case of railways if the persons employed is less than

________ the wages shall be paid before the expiry of 7th day.

Correct Answer 1000

Your Answer 1000


Question The Balance Sheet should be in the form set out in Part I of :-Correct Answer Schedule VI

Your Answer Schedule VI

True/False

Question Wages includes any remuneration payable under any award or settlement

between the parties or order of court.

Correct Answer True

Your Answer True


Question When was the minimum wages act passed ?

Correct Answer 1948

Your Answer 1948

True/False

Question Foreign technical collaborations are permitted.


Your Answer True

True/False


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Question Wages includes any travelling allowance for travel concession.


Your Answer False


Question Companies Act presently implemented and adhered by companies is :-

Correct Answer Companies Act, 1956

Your Answer Companies Act, 1956


Question Sole selling agent may be :-

Correct Answer An Individual , A firm , A Body corporate

Your Answer An Individual , A firm , A Body corporate

Select The Blank

Question To avoid conflicts of interest, ________ committee would determine the

remuneration packages of the executive directors.

Correct Answer RemunerationYour Answer Board members


Question A director of a company can be removed by :-

Correct Answer Ordinary resolution

Your Answer Ordinary resolution

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

Your Answer TrueMultiple Choice Single Answer

Question A director can hold place of profit by :-

Correct Answer Special resolution

Your Answer Special resolution

Select The Blank

Question Articles of Association are rules for ________.

Correct Answer Internal management

Your Answer Internal management


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

Your Answer Power to make calls on shares , Power to issue debentures , Power

to borrow money



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Question The period for realization for export of goods from the date of shipment is

at :-

Correct Answer Six month

Your Answer Six month


Question Accounting Standards are issued by :-

Correct Answer Institute of Chartered Accountants

Your Answer Institute of Chartered Accountants


Question Describe in brief what does the term wages include?

Correct Answer Remuneration under any award , Settlement between the parties or

order of court , Overtime

Your Answer Remuneration under any award , Settlement between the parties or

order of court , Overtime

Multiple Choice Multiple AnswerQuestion What is the main purpose of the payment of wages act 1936?

Correct Answer Ensure payment of wages to the employed , Prevent unauthorised

deductions , Prevent arbitrary fines

Your Answer Ensure payment of wages to the employed , Prevent unauthorised

deductions , Prevent arbitrary fines

Select The Blank

Question ________means all remuneration expressed in terms of money.

Correct Answer Wages

Your Answer Wages

Multiple Choice Multiple AnswerQuestion 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

Your Answer Held by non resident shareholder , As per acquisition , In the Form

of FC-GPR , Willingness of company

Match The Following


Section 2(vi) Wages Wages

Wages act 1936 1936

Factories act 1948 1948

Section 3 of wages actEvery employer responsible for payment to employed persons

Every employer responsible for payment to employed persons


Question Board may by resolution passed at the meeting delegate the powers to :-

Correct Answer Committee of directors , Managing director , Manager


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Your Answer Committee of directors , Managing director , Manager

True/False

Question Meeting of the board of Directors shall be held at least 4 times in a year.

Correct Answer True

Your Answer True


Question Who has not prescribed particular set of documentation for current

account remittances?

Correct Answer RBI , Central Govt.

Your Answer RBI , Central Govt.

True/False

Question A temporary workman is not entitled to bonus though he works for a few

days in the organisation.


Your Answer FalseMultiple Choice Single Answer

Question Which person is responsible for he payment of wages act ?

Correct Answer Managers

Your Answer Managers

Select The Blank

Question Multimodal ________ making remittance to their agents abroad.

Correct Answer Transport operators

Your Answer Transport operators

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Labels: Legal Aspects of Finance(Set VII)

Legal Aspects of Finance - 21



Question For which activity FDI is not prohibited?

Correct Answer Insurance

Your Answer Insurance


Question Remuneration to the director may be paid :-

Correct Answer Monthly , Quarterly , Annually

Your Answer Quarterly , Annually , Monthly


Question Payment of wages act came into existence :-

Correct Answer To ensure regular and timely payment of wages to employed


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persons

Your Answer To ensure regular and timely payment of wages to employed

persons


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

Your Answer 3 years


Question Sole selling agent may be :-

Correct Answer An Individual , A firm , A Body corporate

Your Answer An Individual , A firm , A Body corporate


Question When was the factories act passed?Correct Answer In 1948

Your Answer In 1948


Question Number of shareholders entitled to requisition a meeting shall be carrying

Correct Answer Not less than 10 per cent of voting power

Your Answer Not less than 10 per cent of voting power

True/False

Question Bonus is an ex gratia payment.


Your Answer FalseMultiple Choice Single Answer

Question Compliance Report is signed by :-

Correct Answer Company Secretary in practice

Your Answer Company Secretary in practice


Question The responsibility of placing the annual accounts before the AGM is on

Correct Answer Board of Directors

Your 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

Your Answer True


Question Following are the points related to Qualification share that every director

has to take :-


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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/-

Your Answer Minimum Share value Rs.5000/- , If fails to obtain then he has to

resign from the post

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

Your Answer True

True/False

Question An independent Director is not an executive director of a Company.


Your Answer True

True/False

Question Owned foreign exchange is not permitted.Correct Answer False

Your Answer True

Select The Blank

Question Copies of annual accounts are to be filed within ________ days from

AGM with ROC.

Correct Answer 30 days

Your Answer 30 days

True/False

Question A non executive director is not a substantial shareholder of the company.

Correct Answer TrueYour Answer True

Match The Following


Bifurcation Voted for/ against Chairman

Ordinary resolution Simple majority Simple majority

Requisition of members Not less than 5 % voting power 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


Question What are the powers of the audit committee?

Correct Answer To investigate any activity within its terms of reference , To seek


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information from any employee , To obtain outside legal or professional advice

Your 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

Your Answer Resolution


Question Which committees are considered for calculating the limit of the

companies

Correct Answer Audit committees , Remuneration Committee , Shareholders

Grievance Committee

Your Answer Audit committees , Remuneration Committee , Shareholders

Grievance CommitteeSelect The Blank

Question The minimum wages to the obligations created by the convention no 26 of

________.

Correct Answer International labour organisation

Your 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.


Your Answer FalseMultiple 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

Your Answer He is found to be of unsound mind , He is declared as an insolvent

, He has not taken qualification shares


Question A company which restricts the right to transfer its shares is :-

Correct Answer Private Ltd. Company

Your Answer Private Ltd. Company

Match The Following


Interim Dividend Board of Directors Board of Directors

Shorter notice for AGM Private Limited Company ROC

Books of Account Form 23AA Form 23AA

Accounting StandardsNational Advisory Committee National Advisory


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Committee


Question Preference shares can be :-

Correct Answer Cumulative redeemable , Non- cumulative redeemable ,

Participatory

Your Answer Cumulative redeemable , Non- cumulative redeemable

True/False

Question Only individuals can be appointed as directors of the company.

Correct Answer True

Your Answer True


Question Director can be appointed without counting the number in :-

Correct Answer Private limited company , Unlimited company , Charitable

association

Your Answer Charitable associationMultiple Choice Multiple Answer

Question Who is not entitled to bonus?

Correct Answer An apprentice , Employee employed through contractors

Your Answer 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

Your Answer 1959Multiple Choice Single Answer

Question To whom does the payment of wages act apply to ?

Correct Answer Persons employed in any factory

Your Answer Persons employed in any factory

Select The Blank

Question Under the industrial disputes act 1947________is an appropriate

government.

Correct Answer Central government

Your Answer Central government


Question When was the minimum wages act passed ?

Correct Answer 1948

Your Answer 1948

True/False

Question Retiring director may be eligible for reappointment.

Correct Answer True


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Your Answer True


Question In which case did the Bombay high court observe the general purpose of

the act?

Correct Answer Arvind mills ltd case

Your Answer Arvind mills ltd case

True/False

Question After completion of Ordinary business other business is transacted at Extra

ordinary General Meeting.


Your Answer False

Select The Blank

Question ________shall certify that they have reviewed the balance sheet and profit

and loss account.

Correct Answer CEOYour Answer CEO

Select The Blank

Question ________ includes legal representative of deceased employer.

Correct Answer Employer

Your 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

Your Answer Fidelity guarantee bondSelect 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

Your 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

Your Answer Audit committee


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


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to borrow money

Your Answer Power to make calls on shares , Power to issue debentures , Power

to borrow money


Question Explanatory Statement should be annexed to Notice for :-

Correct Answer Special business

Your Answer Special business


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

Your 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


Question Conditions on borrowings by PIO are :-Correct Answer Non-repatriation basis , Loan by inward remittance , Account by

lender in India

Your Answer Current Account , Non-repatriation basis , Loan by inward

remittance

at 9:48 PM0 commentsLinks to this post

Labels: Legal Aspects of Finance(Set VII)

Legal Aspects of Finance - 20



Question

Director can be appointed without counting the number in :-

Correct Answer

Private limited company , Unlimited company , Charitable association

Your Answer

Unlimited company , Charitable association


Question

Who is entitled to bonus?

Correct Answer

Temporary workmen , Part time employee , Retrenched employee

Your Answer

Temporary workmen , Part time employee , Retrenched employee

True/False


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Question

Payment to a scheme of insurance of a post office is not a deduction.

Correct Answer

False

Your Answer

True

True/False

Question

Deductions for income tax, payable by the employed person is permissible.

Correct Answer

True

Your Answer

True

Select The Blank

QuestionRBI in consultation with ________ regulates the capital transactions.

Correct Answer

Central govt.

Your Answer

Central govt.


Question

Company can take loan from :-

Correct Answer

Banks , Financial Institutions , Debenture HoldersYour Answer

Banks , Financial Institutions , Debenture Holders


Question

Who is empowered to specify the Foreign Exchange transactions limits under

FEMA?

Correct Answer

Reserve Bank of India

Your Answer

Exchange Control Board

Select The Blank

Question

The minimum wages act came in force in the year________.

Correct Answer

1948

Your Answer


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1948

Select The Blank

Question

Under section ________ period in respect of which wages would be paid would be

determined.

Correct Answer

3

Your Answer

5

Select The Blank

Question

________ includes legal representative of deceased employer.

Correct Answer

Employer

Your AnswerEmployer


Question

For which activity FDI is not prohibited?

Correct Answer

Insurance

Your Answer

Insurance


QuestionFollowing Resolutions must be passed by Postal Ballot :-

Correct Answer

Alteration in Object Clause , Buy-back of own shares , Variation in rights attached

to class of shares

Your Answer

Alteration in Object Clause , Buy-back of own shares

Select The Blank

Question

It is the primary ________ of the company to file the documets of creation of

charge.

Correct Answer

Responsibility

Your Answer

Responsibility

Select The Blank

Question


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It is advisable to close the financial year on ________.

Correct Answer

31st March

Your Answer

31st March


Question

If an auditor after his appointment becomes subject to any of the disqualifications, it

is treated that the office is :-

Correct Answer

Vacated

Your Answer

Vacated


QuestionBoard's Report shall include :-

Correct Answer

Dividend recommended , Financial position of the company , Amounts transferred

to Reserves

Your Answer

Dividend recommended , Taxes paid , Financial position of the company

Match The Following

Question

Correct Answer

Your AnswerInternal auditor

Employee of the company

Doing legal things

Insolvent

A person who is not in a position to pay his dues

A person who is not in a position to pay his dues

Moral turpitude

Doing immoral things

Doing immoral things

Call on share

Demand of remaining part of share capital value

Demand of remaining part of share capital value

Select The Blank

Question

For Special Resolution, votes cast in favour of the resolution should be ________

times more than votes cast against the resolution.


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Correct Answer

3

Your Answer

3

True/False

Question

Every company shall have a qualified and independent audit committee.

Correct Answer

True

Your Answer

True


Question

Who issues a certificate of compliance of conditions of corporate governance?

Correct AnswerAuditors or company secretaries

Your Answer

Registrar of companies

True/False

Question

Wages includes the value of any house accommodation or supply of light and

water.

Correct Answer

False

Your AnswerFalse

True/False

Question

A temporary workman is not entitled to bonus though he works for a few days in the

organisation.

Correct Answer

False

Your Answer

True


Question

Public limited company's directors have following conditions :-

Correct Answer

Minimum number is three , Should be individuals , Have sound mind

Your Answer

Minimum number is three , Should be individuals , Have sound mind


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True/False

Question

Debenture holders are creditors of the company.

Correct Answer

True

Your Answer

True

True/False

Question

Any gratuity payable on termination of employment is included in wages.

Correct Answer

False

Your Answer

False

Multiple Choice Single AnswerQuestion

What is the optimum combination of Board of Directors?

Correct Answer

Managing Directors and Secretary

Your Answer

Executive and non executive Directors


Question

If date of incorporation is 1.1.2005, first AGM must be held before :-

Correct Answer30.6.2006

Your Answer

30.6.2006

Match The Following

Question

Correct Answer

Your Answer

Interim Dividend

Board of Directors

Board of Directors

Shorter notice for AGM

Private Limited Company

ROC

Books of Account

Form 23AA

Registered Office


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Accounting Standards

National Advisory Committee

Form 23AA

True/False

Question

Wages includes any remuneration payable under any award or settlement between

the parties or order of court.

Correct Answer

True

Your Answer

True


Question

Present limit for giving details of employees in Directors' Report is :-

Correct AnswerRs. 2 lac p.m.

Your Answer

Rs. 5 lac p.m.


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

Your AnswerReview the annual financial statements , Recommending and appointment of

external auditors , Reviewing the company's financial and risk management policies


Question

What has the national labour omission described about passing of the act?

Correct Answer

Landmark in the history of labour legislation in the country

Your Answer

Landmark in the history of labour legislation in the country

Select The Blank

Question

As per section ________ it is obligatory on every person responsible for payment.

Correct Answer

4

Your Answer

2


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True/False

Question

Financial year and calendar year are one and the same thing.

Correct Answer

False

Your Answer

False


Question

For public company, quorum for general meeting is :-

Correct Answer

5 members in person

Your Answer

5 members in person

True/FalseQuestion

Only individuals can be appointed as directors of the company.

Correct Answer

True

Your Answer

True


Question

FDI prohibited activities are :-

Correct AnswerRetail trading , Gambling & betting , Housing & real estate

Your Answer

Retail trading , Gambling & betting , Housing & real estate

Select The Blank

Question

Preference shareholders have ________ to get dividend over equity share holders.

Correct Answer

Preferential right

Your Answer

Preferential right

True/False

Question

No person can be appointed as an auditor of the company who is in full time

employment.

Correct Answer

True


20/21

Your Answer

True

True/False

Question

Authorized dealer is required to avail license under the exim policy in force.

Correct Answer

True

Your Answer

True

Select The Blank

Question

As per section 5 in case of railways if the persons employed is less than ________

the wages shall be paid before the expiry of 7th day.

Correct Answer

1000Your Answer

1000


Question

As per section 3 who fixes the minimum rate of wages to be paid to the employees

?

Correct Answer

Appropriate government

Your Answer

Appropriate governmentMultiple Choice Multiple Answer

Question

Remittance completely prohibited on :-

Correct Answer

Dividend balancing , Telephone expanses , Interest on funds

Your Answer

Dividend balancing , Telephone expanses , Interest on funds

True/False

Question

Default in placing annual accounts before AGM may result in imprisonment.

Correct Answer

True

Your Answer

True


Question


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A director of a company can be removed by :-

Correct Answer

Ordinary resolution

Your Answer

Ordinary resolution

True/False

Question

After completion of Ordinary business other business is transacted at Extra ordinary

General Meeting.

Correct Answer

False

Your Answer

True

True/False

QuestionWages includes any travelling allowance for travel concession.

Correct Answer

False

Your Answer

False

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Legal Aspect of Finance -1