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Quizzes > Business & Finance > Business & Industry

Test Your Knowledge with the Companies Act Quiz

Think you can ace this Companies Act pop quiz? Dive in and challenge your company law knowledge!

Difficulty: Moderate
2-5mins
Learning OutcomesCheat Sheet
Paper art illustration for quiz on company law and governance skills on a golden yellow background

Ready to level up your company law IQ? Our act pop quiz and corporate law pop quiz put your governance know-how to the test with sharp questions on board duties, compliance and shareholder rights. This companies act quiz is perfect for corporate pros and aspiring secretaries brushing up on the Companies Act. Gauge your strengths in our company law quiz, then take on the companies act test to see where you shine. Warm up with fun company trivia questions or jump straight into a targeted business law quiz . Dive in now and prove you've got the chops for corporate law mastery!

What type of company is allowed to offer its shares to the general public?
Private company
Public company
One Person Company
Unlimited company
A public company is permitted to invite the general public to subscribe to its shares, unlike private companies which cannot offer shares publicly. This is defined under the Companies Act, which distinguishes private companies by restrictions on share transfers. Public companies must comply with stricter disclosure requirements and minimum capital norms. MCA Official Website
Which document sets out the main objectives of a company?
Articles of Association
Memorandum of Association
Prospectus
Board Resolution
The Memorandum of Association (MOA) is the primary charter of a company and describes its scope, objectives, and powers. It is a mandatory document filed at the time of incorporation under the Companies Act. Any alteration to the MOA requires a special resolution. Investopedia on MOA
Which document outlines the internal rules and regulations for the governance of a company?
Prospectus
Memorandum of Association
Articles of Association
Share Certificate
The Articles of Association (AOA) govern the internal management of a company, detailing procedures for board meetings, share transfers, and member rights. It complements the MOA and ensures day-to-day regulatory compliance. Changes to the AOA require a special resolution by shareholders. Investopedia on AOA
What is the minimum number of directors required for a public company under the Companies Act, 2013?
One
Two
Three
Seven
Under Section 149 of the Companies Act, 2013, a public company must have at least three directors. This ensures a minimum level of governance and oversight. Private companies, by contrast, require only two directors. MCA Section 149
Under the Companies Act, 2013, what is the minimum paid-up share capital required for a private company?
INR 1 lakh
INR 5 lakhs
No minimum requirement
INR 10 lakhs
The Companies (Amendment) Act, 2015 removed the requirement for minimum paid-up share capital for private companies. Previously set at INR 1 lakh, this provision was abolished to simplify incorporation. Now, private companies can be formed without any minimum capital threshold. ICSI on Amendment Act
Which type of resolution is required to alter the Articles of Association of a company?
Ordinary resolution
Special resolution
Unanimous resolution
Board resolution
Altering the Articles of Association requires a special resolution under Section 114 of the Companies Act, 2013. A special resolution demands at least 75% majority of votes cast by members. This higher threshold ensures member consensus for fundamental changes. MCA Resolution Types
What is the quorum for a board meeting of a listed public company under the Companies Act, 2013?
One-third of total strength or two directors, whichever is lower
Two directors
One-third of total strength or two directors, whichever is higher
Four directors
Section 174 of the Companies Act, 2013 mandates that the quorum for board meetings is one-third of its total strength or two directors, whichever is higher. This ensures adequate board representation. Listed entities must also comply with SEBI listing norms. SEBI Listing Obligations
Who is primarily responsible for ensuring compliance with the Companies Act’s secretarial standards and filings?
Chief Financial Officer
Chief Executive Officer
Company Secretary
Independent Director
The Company Secretary plays a key role as compliance officer, ensuring that secretarial standards are followed and filings are made timely under Section 203. They advise the board on governance matters and statutory compliance. ICSI Role of Company Secretary
Within how many months must a private company hold its first Annual General Meeting under the Companies Act, 2013?
6 months
9 months
12 months
15 months
Section 96 requires companies to hold the first AGM within nine months from the close of the first financial year. Subsequent AGMs must be held within six months of year-end. This ensures timely member oversight. MCA on AGMs
Which form must be filed with the Registrar of Companies to submit a company’s annual return?
MGT-1
MGT-5
MGT-7
MGT-8
Form MGT-7 is prescribed under Section 92 for filing a company’s annual return, containing details of directors, shareholders, and key managerial personnel. It must be filed within 60 days of the AGM. MCA Annual Return
What is the maximum number of members (excluding past members) a private company may have under the Companies Act, 2013?
50
100
200
No limit
Section 2(68) limits a private company’s membership to a maximum of 200, excluding former members who have ceased to be members. Exceeding this threshold reclassifies it as a public company. MCA Membership Limit
Which type of winding-up of a company can be initiated by the National Company Law Tribunal?
Voluntary winding-up
Compulsory winding-up
Creditor’s voluntary winding-up
Members’ voluntary winding-up
Compulsory winding-up can be ordered by the NCLT under Section 270 when a company cannot pay its debts or otherwise meets grounds for winding-up. Voluntary winding-up is initiated by shareholders or creditors. NCLT on Winding-up
What does a derivative action allow shareholders to do under the Companies Act, 2013?
Sue the company for dividend payment
Initiate legal action on behalf of the company
Merge with another company
Call an extraordinary general meeting
A derivative action under Section 245 allows shareholders to sue on behalf of the company where wrongs have been done to the company by its officers. It protects minority interests when the board fails to act. ICSI on Derivative Action
Who is qualified to audit the statutory financial statements of a company under the Companies Act, 2013?
Company Secretary
Internal Auditor
Statutory Auditor
Government Auditor
The Companies Act mandates appointment of a statutory auditor, who must be a practicing Chartered Accountant or audit firm, to audit and report on financial statements. Internal auditors provide internal controls review but cannot issue statutory audit reports. MCA on Auditors
Under Section 185 of the Companies Act, 2013, what is the general restriction on loans to directors?
Loans to directors are prohibited unless permitted by law
Unlimited loans are allowed
Interest-free loans only
Loans must be secured by personal guarantee
Section 185 restricts companies from providing loans, guarantees, or security to directors or related persons unless specific conditions are satisfied. This prevents misuse of corporate funds for personal gain. Non-compliance attracts penalties. MCA Section 185
Which resolution is required to remove a director before the expiration of his term under the Companies Act, 2013?
Special resolution
Ordinary resolution
Unanimous resolution
Board resolution
Under Section 169, removal of a director before term expiry is effected by passing an ordinary resolution in an AGM or EGM. The director has a right to be heard at the meeting. Shareholders vote by simple majority. MCA on Removal of Directors
Which section of the Companies Act, 2013 deals specifically with related party transactions and their approval?
Section 177
Section 188
Section 186
Section 189
Section 188 prescribes the framework for related party transactions, requiring board and shareholder approval for transactions above prescribed thresholds. This enhances transparency and prevents conflicts of interest. MCA Section 188
What remedy can a shareholder seek under the Companies Act, 2013 for oppression and mismanagement?
Winding up petition
Petition under Section 241
Derivative action under Section 245
Special resolution
Section 241 allows shareholders or depositors to petition the tribunal if the company's affairs are conducted in a manner oppressive to any member or prejudicial to public interest. The tribunal can provide various reliefs, including regulation of conduct. NCLT on Oppression & Mismanagement
Under the Companies Act, 2013, which offence is classified as non-compoundable?
Late filing of annual return
Failure to maintain statutory registers
Fraudulent trading under Section 447
Default in holding AGM
Section 447 defines fraudulent activity and classifies it as a non-compoundable offence due to its serious nature. Non-compoundable offences cannot be settled by paying a fine and require adjudication. This deters corporate fraud. MCA Section 447
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Study Outcomes

  1. Understand Incorporation and Registration Process -

    Identify the essential steps and documentation required to form a company under the Companies Act, ensuring clarity on incorporation procedures.

  2. Analyze Governance Structures and Roles -

    Distinguish between the functions of shareholders, directors, and officers by tackling scenarios in our company law quiz.

  3. Apply Compliance Requirements and Reporting -

    Demonstrate knowledge of statutory filings, annual returns, and compliance timelines through practical questions in this act pop quiz.

  4. Evaluate Directors' Duties and Liabilities -

    Assess the scope of fiduciary duties, conflicts of interest, and potential liabilities faced by directors under corporate law pop quiz challenges.

  5. Identify Consequences of Non-Compliance -

    Recognize possible penalties, fines, and legal remedies for breaches of the Companies Act, preparing you for real-world governance issues.

  6. Reinforce Key Company Law Concepts -

    Consolidate your understanding of company formation, governance, and compliance by reviewing quiz feedback and explanations.

Cheat Sheet

  1. Company Formation & Registration -

    Under Section 7 of the UK Companies Act 2006, a company springs to life once the Memorandum, Articles, and Form IN01 are correctly lodged at Companies House (Gov.UK). Use the "CAR" mnemonic - Capital, Articles, Registration - to remember the core incorporation documents for your act pop quiz prep. Try filling out a mock IN01 to internalise the process and build speed.

  2. Memorandum vs Articles of Association -

    The Memorandum sets a company's name, object, and capital clauses, while the Articles govern internal rules and director-shareholder relationships (Cambridge University). A handy mnemonic: "Mission & Rules" to recall Memorandum vs Articles when tackling your companies act quiz. Reviewing sample clauses helps you quickly spot drafting pitfalls.

  3. Directors' Duties & Corporate Governance -

    Directors must comply with statutory duties under Sections 171 - 177 of the Companies Act 2006, including loyalty, skill, and due care (Harvard Law Review). Remember "FID": Fiduciary duty, Independence obligations, and Duty of care - key pillars for any company law quiz. Map each duty to a real-world scenario like conflict-of-interest or board decision-making.

  4. Share Capital & Securities Distinction -

    Distinguish shares from debentures using the "Creditor vs Owner" test - debenture holders are creditors, shareholders have ownership rights (ICAEW guidance). Calculate fully paid capital with the formula: Number of Shares × Nominal Value = Total Share Capital, essential for the companies act test. Try classifying instruments in case studies to sharpen your analysis.

  5. Annual Filings & Compliance Checklist -

    Every year, companies must file a Confirmation Statement, financial accounts, and audit reports with Companies House within prescribed deadlines (Gov.UK). Use a compliance calendar or app with alerts as your go-to "checklist hack" for the corporate law pop quiz. Tracking due dates like nine months post year-end will keep you ahead of penalties.

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