Saturday, 11 June 2011

Article of Association

It is a document in which rules and regulations are written which govern the internal administration of the company. It defines the powers and rights of the directors, officers and shareholders. The article of association are framed and registered to settle the daily affairs of the company. It is subsidiary of Memorandum of Association. No any rule can be framed which against the Memorandum of Association.

Contents of the Article of Association :-
Following matters are discussed in the Article of association.

1. Amount of capital and its division into various shares.

2. Rights regarding the different shareholders.

3. Rules regarding transfer of shares.

4. Rules regarding issue of shares and debentures.

5. Calls on shares.

6. Appointment of directors powers and duties.

7. Alteration of capital.

8. The functions and powers of managing agent.

9. Proceeding of disposing of resolution.

10. Accounts and audit.

11. Stamp of a company.

12. Voting rights of shareholders.

13. Procedure of the winding up of the company.

14. Rules regarding the forfeiture and surrender of shares.

15. Proceeding of shareholders meeting.

16. Proceeding of Board of Directors meetings.

17. Change of shares into stock and stock into shares.

Alteration :-
Article of association can be altered by the company as company wants. According company ordinance, a company may alter its articles by special resolution. But an alteration may not conflict with the memorandum .

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