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CSEET · Fundamentals of Accounting · Introduction to Company Accounts

Which of the following is NOT treated as an alteration of share capital that a limited company may make, if authorised by its articles, by altering its memorandum in general meeting?

Issuing shares at a discount is not one of the alterations of share capital listed in the Act. A company may increase authorised capital, consolidate, sub-divide, convert fully paid shares into stock, or cancel shares not taken, if its articles authorise it.

  1. AIncreasing its authorised share capital
  2. BSub-dividing shares into shares of smaller amount
  3. CConverting fully paid-up shares into stock
  4. DIssuing shares at a discount to the public as a matter of choiceCorrect

Explanation

Section 61 lists increase of authorised capital, consolidation, conversion of fully paid shares into stock, sub-division and cancellation of untaken shares. Issuing shares at a discount is not an alteration listed there, so it is the exception.

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