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Define prospectus and give contents of prospectus.
Define prospectus and give contents of prospectus.
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After the receipt of a certificate of incorporation, if the promoters of a public limited company wish to issue shares to the public, he will issue a document called prospectus. It is an invitation to the public to subscribe to the share capital of the company. The Companies Act, 1956 defines prospectus as any document described or issued as a prospectus and include any notice, circular, advertisement or other documents inviting deposits from the public or inviting offers from the public for the subscription of shares. It is circulated among the public in printed pamphlets. It gives all the necessary information about the company so that the prospective shareholders may fully understand the objectives and the plans of the company.The following important matter is included in the prospectus:
The prospectus contains the main objectives of the company, the name, and addresses of the signatories of the memorandum of association and the number of shares held by them.1. The name, addresses, and occupation of directors and managing directors.2. The number and classes of shares and debentures issued.3. The qualification share of directors and the interest of directors for the promotion of a company.4. The number, description and the document of shares or debentures which within the two preceding years have been agreed to be issued other than cash.5. The name and addresses of the vendors of any property acquired by the company and the amount paid or to be paid.particulars about the directors, secretaries and the treasures and their remuneration.6. The amount for the minimum subscription.7. The estimated amount of preliminary expenses.8. Name and address of the auditors, bankers, and solicitors of the company.9. Time and place where copies of balance sheets, profits and loss account, and the auditor's report may be inspected.10. The auditor’s report so submitted must deal with the profit and loss of the company for each year of five financial years immediately preceding the issue of the prospectus.11. If any profit or reserve has been capitalized, the particulars of such capitalization will be stated in the prospectus.
The following important matter is included in the prospectus:
The prospectus contains the main objectives of the company, the name, and addresses of the signatories of the memorandum of association and the number of shares held by them.
1. The name, addresses, and occupation of directors and managing directors.
2. The number and classes of shares and debentures issued.
3. The qualification share of directors and the interest of directors for the promotion of a company.
4. The number, description and the document of shares or debentures which within the two preceding years have been agreed to be issued other than cash.
5. The name and addresses of the vendors of any property acquired by the company and the amount paid or to be paid.
particulars about the directors, secretaries and the treasures and their remuneration.
6. The amount for the minimum subscription.
7. The estimated amount of preliminary expenses.
8. Name and address of the auditors, bankers, and solicitors of the company.
9. Time and place where copies of balance sheets, profits and loss account, and the auditor's report may be inspected.
10. The auditor’s report so submitted must deal with the profit and loss of the company for each year of five financial years immediately preceding the issue of the prospectus.
11. If any profit or reserve has been capitalized, the particulars of such capitalization will be stated in the prospectus.
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