Legal Aspects of Finance - 3

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 5
Your 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
Multiple Choice Single Answer
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/False
Question Authorized dealer is required to avail license under the exim
policy in force.
Correct Answer True
Your Answer True
Multiple Choice Single Answer
Question The earlier "Fast Track" investments route has been replaced
by?
Correct Answer Automatic
Your Answer Automatic
Multiple Choice Single Answer
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
Multiple Choice Single Answer
Question Payment of wages act came into existence :-
Correct Answer To ensure regular and timely payment of wages to employed
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 Rupees
Your Answer In Rupees , On repatriation , On Payments made
Multiple Choice Multiple Answer
Question What do youmean 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
Multiple 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
Multiple Choice Single Answer
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
Multiple Choice Single Answer
Question Define an employed person under section 2 of the act.
Correct Answer Includes legal representative of a deceased employed person
Your Answer Includes legal representative of a deceased employed person
Multiple Choice Multiple Answer
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
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 Standards National 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
Multiple Choice Multiple Answer
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
Multiple Choice Single Answer
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
Multiple Choice Single Answer
Question When was the minimum wages act passed ?
Correct Answer 1948
Your Answer 1948
True/False
Question Foreign technical collaborations are permitted.
Correct Answer False
Your Answer True
True/False
Question Wages includes any travelling allowance for travel concession.
Correct Answer False
Your Answer False
Multiple Choice Single Answer
Question Companies Act presently implemented and adhered by
companies is :-
Correct Answer Companies Act, 1956
Your Answer Companies Act, 1956
Multiple Choice Multiple Answer
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 Remuneration
Your Answer Board members
Multiple Choice Single Answer
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 True
Multiple 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
Multiple Choice Multiple Answer
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
Multiple Choice Single Answer
Question The period for realization for export of goods from the date of
shipment is at :-
Correct Answer Six month
Your Answer Six month
Multiple Choice Single Answer
Question Accounting Standards are issued by :-
Correct Answer Institute of Chartered Accountants
Your Answer Institute of Chartered Accountants
Multiple Choice Multiple Answer
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 Answer
Question 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 Answer
Question 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
Question Correct Answer Your Answer
Section 2(vi) Wages Wages
Wages act 1936 1936
Factories act 1948 1948
Section 3 of wages act Every employer
responsible for payment to
employed persons
Every employer
responsible for payment to
employed persons
Multiple Choice Multiple Answer
Question Board may by resolution passed at the meeting delegate the
powers to :-
Correct Answer Committee of directors , Managing director , Manager
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
Multiple Choice Multiple Answer
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.
Correct Answer False
Your Answer False
Multiple 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




LIST OF ATTEMPTED QUESTIONS AND ANSWERS
Select The Blank
Question Director has to vacate his office, if he has been ________ by a
court of any offence involving moral turpitude.
Correct Answer Convicted
Your Answer Convicted
True/False
Question There should be a gap of more than 4 months to have the
meeting of the board of directors.
Correct Answer False
Your Answer False
Multiple Choice Multiple Answer
Question 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
True/False
Question The national labour commission on labour has described the
assessing of the act as landmark in the history of labour
legislation in the country.
Correct Answer True
Your Answer True
Select The Blank
Question Payment of ________ requires registration from RBI.
Correct Answer Royalty
Your Answer Royalty
True/False
Question The Board has power to alter Articles of Association being
internal document.
Correct Answer False
Your Answer False
Multiple Choice Single Answer
Question A director is deemed to be interested in a contract if he holds
paid up capital of the company exceeding :-
Correct Answer 0.02
Your Answer 0.02
Match The Following
Question Correct Answer Your Answer
Capital Account Guarantee by a person
resident
Accounting Authority
Living Expenses Current Account Current Account
Deposits Capital Account Capital Account
The Adjudicating Authority Power of Classification Guarantee by a person
resident
Multiple Choice Single Answer
Question Any contract or arrangement in which director is interested has
to be recorded in :-
Correct Answer Register of contracts
Your Answer Register of directors
Multiple Choice Single Answer
Question Quorum required to hold a valid meeting can be prescribed in :-
Correct Answer Articles of Association
Your Answer Articles of Association
Select The Blank
Question Every private company should have minimum ________
directors.
Correct Answer Two
Your Answer Two
True/False
Question A General Meeting may also be called by giving shorter notice
than 21 days.
Correct Answer True
Your Answer False
Multiple Choice Single Answer
Question The Board of directors of the company has power to appoint an
additional director :-
Correct Answer Up to maximum permissible limit
Your Answer Up to maximum permissible limit
Select The Blank
Question Articles of Association are rules for ________.
Correct Answer Internal management
Your Answer Running business of Company
Multiple Choice Multiple Answer
Question WOS are allowed to :-
Correct Answer Pay royalty , Offshore payment , By automatic route
Your Answer Pay royalty , Offshore payment , By automatic route
Select The Blank
Question ________shall certify that they have reviewed the balance sheet
and profit and loss account.
Correct Answer CEO
Your Answer CEO
Multiple Choice Multiple Answer
Question In calculating the limit of all the companies which companies are
excluded?
Correct Answer Foreign companies , Private Companies , Non Profit making
companies
Your Answer Foreign companies , Private Companies , Non Profit making
companies
Multiple Choice Multiple Answer
Question What are the penalties for the offences done ?
Correct Answer Fine which may extend to 6 months , May extend to Rs 500 ,
Fine as well as Rs 500
Your Answer Fine which may extend to 6 months , May extend to Rs 500 ,
Fine as well as Rs 500
Select The Blank
Question Under the industrial disputes act 1947________is an appropriate
government.
Correct Answer Central government
Your Answer Central government
Multiple Choice Multiple Answer
Question Retiring director shall be deemed to be reappointed unless :-
Correct Answer He has expressed his unwillingness to be re-appointed , He is
disqualified for appointment , Resolution for reappointment has
been put to vote & lost
Your Answer He has expressed his unwillingness to be re-appointed , He is
disqualified for appointment , Resolution for reappointment has
been put to vote & lost
Multiple Choice Multiple Answer
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
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
True/False
Question An independent Director is not an executive director of a
Company.
Correct Answer False
Your Answer True
Select The Blank
Question When a money is raised through ________ it shall disclose to
the audit committee.
Correct Answer Initial public offering
Your Answer Initial public offering
Multiple Choice Multiple Answer
Question Person permanently resident in India can return foreign
exchange by :-
Correct Answer Travelling abroad , As a gift , From AD
Your Answer From AD , Travelling abroad , As a gift
True/False
Question Bonus is an ex gratia payment.
Correct Answer False
Your Answer False
Multiple Choice Single Answer
Question Proxy form should be deposited with the company :-
Correct Answer 48 hours before the meeting
Your Answer 48 hours before the meeting
Select The Blank
Question The minimum wages act came in force in the year________.
Correct Answer 1948
Your Answer 1958
True/False
Question A director is not required to take qualification share.
Correct Answer False
Your Answer False
Multiple Choice Single Answer
Question Venture capital Funds are regulated as per the Norms of :-
Correct Answer SEBI
Your Answer NABARD
True/False
Question Wages includes any travelling allowance for travel concession.
Correct Answer False
Your Answer False
Multiple Choice Multiple Answer
Question Public Company means a company which :-
Correct Answer Has a minimum paid-up share-capital of Rs. 5 lac , Is private
company which is subsidiary of public company , Is not a private
company
Your Answer Has a minimum paid-up share-capital of Rs. 5 lac , Is private
company which is subsidiary of public company , Is not a private
company
True/False
Question Deductions for income tax, payable by the employed person is
permissible.
Correct Answer True
Your Answer True
Multiple Choice Single Answer
Question As per the provisions of Companies Act 1956, company can
issue shares with :-
Correct Answer Differential voting rights
Your Answer Differential voting rights
Match The Following
Question Correct Answer Your Answer
Majority members Independent Independent
Audit committee Seek information about
the employee
Independent
Quorum for audit
committee
2 members or 1/3rd of
members
2 members or 1/3rd of
members
Members of audit
committee
Non executive directors Seek information about the
employee
Multiple Choice Multiple Answer
Question Following are the Forms to be submitted to ROC for
incorporation of company :-
Correct Answer Form 32 , Form 29 , Form 1
Your Answer Form 32 , Form 29
True/False
Question The independent director is a supplier of a service provider of
the company.
Correct Answer False
Your Answer False
Multiple Choice Single Answer
Question What does the minimum wages act determine ?
Correct Answer The minimum wages in industries specified in the schedule
Your Answer The minimum wages in industries specified in the schedule
Select The Blank
Question Private Company prohibits public to ________ for any shares.
Correct Answer Subscribe
Your Answer Subscribe
Multiple Choice Single Answer
Question Unless the articles of association otherwise provide, every
director has to hold the shares of nominal value of Rs.:-
Correct Answer 5000/-
Your Answer 10000/-
Multiple Choice Multiple Answer
Question The provision related to register are not applicable to :-
Correct Answer Banking company or insurance company , A company whose
principle business is acquisition of shares, stock, debentures or
other securities , A private limited company unless it is a
subsidiary of public company.
Your Answer A private limited company unless it is a subsidiary of public
company. , A listed company
Multiple Choice Single Answer
Question The notice of the meeting be sent to all the directors at their :-
Correct Answer Usual residential address
Your Answer Usual postal address
Multiple Choice Single Answer
Question Maturity period for foreign currency credit by overseas suppliers
is :-
Correct Answer More than 6 months & less 3 years
Your Answer More than 3 months & less 3 years
Select The Blank
Question ________ is a scheduled employment carried out under the
authority of central government.
Correct Answer Competent authority
Your Answer Employer
Multiple Choice Multiple Answer
Question Under which circumstances will the worker not receive wages for
full normal working days ?
Correct Answer If failure to work is caused by unwillingness to work , Not by
omission of the employer to provide him with work
Your Answer If failure to work is caused by unwillingness to work , Not by
omission of the employer to provide him with work
Multiple Choice Single Answer
Question If there is any delay in filing Form- 8 &13 beyond 60 days from
the execution of documents for the creation of charge, the
company has to make petition to :-
Correct Answer Company Law Board
Your Answer Company Law Board
Multiple Choice Multiple Answer
Question Borrowings for Indian companies are for :-
Correct Answer In Rupees , On repatriation , Non-repatriation
Your Answer In Rupees , On repatriation




LIST OF ATTEMPTED QUESTIONS AND ANSWERS
Select The Blank
Question Board has power to receive of notice of ________.
Correct Answer Disclosure of interest
Your Answer Disclosure of interest
True/False
Question Wages includes the value of any house accommodation or
supply of light and water.
Correct Answer False
Your Answer True
Multiple Choice Single Answer
Question Maximum fine which can be levied for default in placing accounts
before AGM is :-
Correct Answer Rs. 50,000
Your Answer Rs. 50,000
Match The Following
Question Correct Answer Your Answer
allocable surplus 67% surplus in the
accounting year
67% surplus in the
accounting year
salary does not include travelling
concession
employee
public sector
establishment
establishment owned by
government
award
interim and final
determination of an
industrial dispute
award award
Select The Blank
Question As per section ________ it is obligatory on every person
responsible for payment.
Correct Answer 4
Your Answer 4
Multiple Choice Multiple Answer
Question Remuneration to the director may be paid :-
Correct Answer Monthly , Quarterly , Annually
Your Answer Monthly , Quarterly , Annually
Multiple Choice Single Answer
Question What is computed by the competent authority at concessional
rates?
Correct Answer Cost of living allowance and cash value
Your Answer Cost of living allowance and cash value
Select The Blank
Question The auditor has to give his report that the accounts of the
company gives ________.
Correct Answer True & Fair view
Your Answer True & Fair view
Select The Blank
Question Articles of Association are rules for ________.
Correct Answer Internal management
Your Answer Voting on resolutions
Multiple Choice Multiple Answer
Question The auditor shall inquire :-
Correct Answer Whether transactions of the company which are represented
merely by book entries are not prejudicial to the interest of the
company or members , Whether loans & advances made by the
company have been shown as deposits , Whether personal
expenses have been charged to revenue account
Your Answer Whether transactions of the company which are represented
merely by book entries are not prejudicial to the interest of the
company or members , Whether loans & advances made by the
company have been shown as deposits , Whether personal
expenses have been charged to revenue account , Whether
directors have taken loan from company
True/False
Question Financial year and calendar year are one and the same thing.
Correct Answer False
Your Answer False
Multiple Choice Single Answer
Question Minimum gap required between date of dispatch of notice and
date of AGM is :-
Correct Answer 25 days
Your Answer 25 days
Select The Blank
Question First AGM should be held within ________ from closure of
financial year.
Correct Answer 9 months
Your Answer 9 months
Select The Blank
Question Every ________ Company has to hold Statutory Meeting of the
members.
Correct Answer Public
Your Answer Limited
Select 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
True/False
Question Any gratuity payable on termination of employment is included in
wages.
Correct Answer False
Your Answer False
Multiple Choice Multiple Answer
Question Director can be appointed without counting the number in :-
Correct Answer Private limited company , Unlimited company , Charitable
association
Your Answer Private limited company , Unlimited company , Charitable
association
Multiple Choice Multiple Answer
Question Borrowings for Indian companies are for :-
Correct Answer In Rupees , On repatriation , Non-repatriation
Your Answer In Rupees , On repatriation , Non-repatriation
Multiple Choice Single Answer
Question Deductions are authorized under which section?
Correct Answer Section 7(2)
Your Answer Section 7(2)
Multiple Choice Single Answer
Question For which activity FDI is not prohibited?
Correct Answer Insurance
Your Answer Insurance
Multiple Choice Single Answer
Question Settlement of gift or lawful obligation shall be surrendered within
:-
Correct Answer Seven days
Your Answer Eight days
Select The Blank
Question The shares with differential voting rights shall not exceed
________ of the total share capital issued.
Correct Answer 0.25
Your Answer 0.2
Multiple Choice Single Answer
Question How much percentage of block of voting shares does the
independent director not own ?
Correct Answer 0.02
Your Answer 0.02
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
Multiple Choice Multiple Answer
Question What are the general provisions for punishment of other
offences?
Correct Answer Section 22 provides for the provision , Punishable with fine , Rs
500 fine
Your Answer Section 22 provides for the provision , Punishable with fine
Select The Blank
Question To avoid conflicts of interest, ________ committee would
determine the remuneration packages of the executive directors.
Correct Answer Remuneration
Your Answer Remuneration
Multiple Choice Single Answer
Question Cap on investment by person resident outside India, for Housing
& Real Estate Sector is :-
Correct Answer 1
Your Answer 1
Multiple Choice Multiple Answer
Question Board may by resolution passed at the meeting delegate the
powers to :-
Correct Answer Committee of directors , Managing director , Manager
Your Answer Committee of directors , Managing director , Manager
Multiple Choice Multiple Answer
Question Sole selling agent may be :-
Correct Answer An Individual , A firm , A Body corporate
Your Answer An Individual , A firm , A Body corporate
Match The Following
Question Correct Answer Your Answer
Regisrtered Morthgage Means paying stamp duty
on assets
Payment of prescribed fee
with R.O.C
Charge Payment of prescribed fee
with R.O.C
Attaching rights on assets
Mortgage It is done in respect of
immovable property
It is done in respect of
immovable property
Hypothecation It is done in respect of It is done in respect of
movable property movable property
Multiple Choice Multiple Answer
Question Remittance completely prohibited on :-
Correct Answer Dividend balancing , Telephone expanses , Interest on funds
Your Answer Dividend balancing , Interest on funds
Multiple Choice Multiple Answer
Question Preference shares can be :-
Correct Answer Cumulative redeemable , Non- cumulative redeemable ,
Participatory
Your Answer Cumulative redeemable , Non- cumulative redeemable ,
Participatory
Multiple Choice Multiple Answer
Question Person permanently resident in India can return foreign
exchange by :-
Correct Answer From AD , Travelling abroad , As a gift
Your Answer From AD , Travelling abroad , As a gift
Select The Blank
Question Under section ________ period in respect of which wages would
be paid would be determined.
Correct Answer 3
Your Answer 5
True/False
Question It is not obligatory for the board of directors to lay down the code
of conduct for all the board members.
Correct Answer False
Your Answer False
Multiple Choice Multiple Answer
Question Following have the right to inspect books of account :-
Correct Answer Any Director of the company , Officer of SEBI (if authorised) ,
Authorised officer of Government
Your Answer Any Director of the company , Officer of SEBI (if authorised) ,
Authorised officer of Government
Multiple Choice Single Answer
Question The earlier "Fast Track" investments route has been replaced
by?
Correct Answer Automatic
Your Answer Automatic
Multiple Choice Single Answer
Question The maximum number of Directors that every company shall
have is :-
Correct Answer Twelve
Your Answer Twelve
True/False
Question The act is undoubtedly a welfare legislation in favour of workers
and more than an essential measure for economic upliftment of
the workers in the sweated industries.
Correct Answer True
Your Answer True
True/False
Question Foreign technical collaborations are permitted.
Correct Answer False
Your Answer True
Multiple Choice Multiple Answer
Question Under which circumstances will the worker not receive wages for
full normal working days ?
Correct Answer If failure to work is caused by unwillingness to work , Not by
omission of the employer to provide him with work
Your Answer If failure to work is caused by unwillingness to work , Not by
omission of the employer to provide him with work
True/False
Question A proxy can appoint another proxy.
Correct Answer False
Your Answer False
True/False
Question A non executive director is not a substantial shareholder of the
company.
Correct Answer True
Your Answer True
True/False
Question Proposal for project exports has been delegated to the approving
authority.
Correct Answer False
Your Answer True
Multiple Choice Single Answer
Question Company can increase its maximum number of directors, for
which application is required to be made in :-
Correct Answer Form no 24
Your Answer Form no 8
True/False
Question Authorized dealer is required to avail license under the exim
policy in force.
Correct Answer True
Your Answer True
Multiple Choice Single Answer
Question FEMA allows free selling of foreign exchange to/from whom from
current transaction?
Correct Answer Authorised Dealer
Your Answer Authorised Dealer