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Class : 11
Unit : Business

State and explain the main contents/clauses of articles of association.

Ans : Articles of association is the document of internal management of the company. It contains rules, regulation and bylaws of the company. For it’s systemic management. This document is sub-ordinate to memorandum of association. It defines the relationship between the company and it’s member. A limited company either private or public has to prepare article of association along with other documents for incorporation. Once the article of association is written it is difficult to bring changes in it. Therefore, it should be written very carefully. Finally, it is signed by the members as in memorandum of association for official validity in presence of minimum one witness. Contents of Articles of Association i) Name and address of the company ii) Authorized capital of the company iii) Objective of the company iv) Liabilities of the shareholders v) Name and address of the promoters (for the public limited company seven and private limited company one) vi) Number of board of director and their tenure vii) Number of minimum share to be the board of director viii) Remuneration (salary), facilities and commission of the board of directors ix) Procedure of general meeting x) Qualification and required qualities for the board of director xi) Methods of appointing employees xii) Right and duties of board of directors xiii) About provision of board of directors meeting xiv) Method of issuing the shares xv) Provision relating to calls on share and for feature of shares xvi) Provision relating to transfer of shares xvii) Appointment of Company Secretary xviii) Uses of the company seal xix) Bank account and signature xx) Method of keeping book of account xxi) Method of auditing and name and address of auditor xxii) Provision of raise loan and debenture xxiii) Emalgamation (Marging) of the company xxiv) Conversion of private limited company to public limited company xxv) All the matter of memorandum of association xxvi) Such other necessary of association according to law of government and Nepal Company Act 2063 BS
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