Question

What is a Statement in Lieu of Prospectus.

Answer 1

A prospectus is a legal document that a corporation publishes to invite the public to subscribe to its shares and debentures. When a company does not offer its securities for public subscription, it issues a statement in lieu of prospectus.

When a firm does not submit a prospectus to the public in order to invite them to subscribe for shares, a Statement in Lieu of Prospectus is submitted with the Registrar of Companies ( ROC ). It’s comparable to a prospectus, except it’s only a few pages long.