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CMA Intermediate · Business Laws and Ethics · Key Managerial Personnel

Under Section 170(1), the register of directors and KMP must include details of securities held by each of them in which of the following?

The register must show securities held in the company itself and in its holding, subsidiary, fellow subsidiary (subsidiary of the holding company) and associate companies. Section 170(1) lists all of these, so restricting disclosure to the company alone or to listed companies is wrong.

  1. AOnly the company in which they hold office
  2. BThe company or its holding, subsidiary, subsidiary of company's holding company or associate companiesCorrect
  3. COnly the company and its holding company
  4. DOnly companies listed on a recognised stock exchange

Explanation

Section 170(1) states that the register shall include details of securities held in the company or its holding, subsidiary, subsidiary of the company's holding company or associate companies. Limiting it to the company alone or to the holding company omits the other categories listed.

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