chp 10 management of company

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1. Management of a Company 1. WHO MANAGE THE COMPANY ? ã One of the important features of a company is that there is separation of ownership from management. ã The shareholders do not directly manage. Instead, they elect some persons from among themselves as their representative to act on behalf of the company. Such persons are known as directors. ã The power to manage however is not entrusted to any single director but to all the directors, collectively called the Board of Directors. 2.Organs
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1. Management of a Company 1. WHO MANAGE THE COMPANY ? \u2022One of the important features of a company is that there is separation of ownership from management. \u2022The shareholders do not directly manage. Instead, they elect some persons from among themselves as their representative to act on behalf of the company. Such persons are known as directors. \u2022The power to manage however is not entrusted to any single director but to all the directors, collectively called the Board of Directors.2.Organs of company management \u2022a) The Shareholders. \u2022b) The Board of Directors,who frame the business policies of the company and are responsible for overall management, supervision and control. \u2022c) The Chief Executive, who may be a Managing Director (MD) or a Manager (M) responsible for day-to-day administration of the company For the assistance of the chief executive there may be \u2022Whole- Time Directors (WTD) and other departmental managers such as finance manager, production manager, personnel manager and company secretary.3.Choice of Managerial Personnel \u2022A company can appoint either one of - Managing Director or Manager (sec 197 A ) \u2022A public company or a private company which is a subsidiary of a public company having a paid up share capital of Rs 5crores or more must have atleast one of the three categories viz, MD , WTD, or M. sec 269(1)4. Number of Directors ãI) Minimum a) A public company must have at least three directors. b) A private company must have at least two directors. ãii) Maximum a) The Companies Act does not fix any maximum number. Where the maximum fixed by articles is less than12,the number can be increased to 12 without Central Government approval.
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