Bonus share issuance requires board recommendation and shareholder approval and prohibits using revaluation reserves. A company may issue fully paid-up bonus shares by capitalising free reserves, the securities premium account or the capital redemption reserve account, ... Summary
Bonus share issuance requires board recommendation and shareholder approval and prohibits using revaluation reserves.
A company may issue fully paid-up bonus shares by capitalising free reserves, the securities premium account or the capital redemption reserve account, but not reserves from asset revaluation. Such issuance requires authorisation in the articles, a Board recommendation and shareholder approval; the company must not be in default on deposit or debt obligations, must be current on specified employee statutory dues, must make partly paid shares fully paid-up, and must satisfy prescribed conditions.
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