Fill in the blanks: Reserve Capital is called up only in the event of ___ and differs from ___ which is part of Reserves and Surplus.

Winding up; Capital Reserve

Explain the significance of the Securities Premium Account and its allowable applications.

Securities Premium Account is significant.

• Supports issuing bonus shares.

• Covers preliminary expense write-offs.

• Funds premiums on preference shares.

True or False: Preference shareholders typically have voting rights in a company.

False. Preference shareholders usually do not have voting rights.

What is the role of SEBI in the share issuance process for public companies?

SEBI regulates share issuance process.

• Ensures compliance with regulations.

• Sets minimum subscription levels.

• Protects investors’ interests.

What happens to shares that are forfeited due to non-payment of calls?

Forfeited shares lose all rights.

• Defaulting shareholder's title ends.

• No refund on amounts paid.

• Shares can be reissued later.

In the case of oversubscription, what method can a company use to allocate shares among applicants?

The company can use pro-rata allotment, where shares are distributed in proportion to the number of shares applied for.

Fill in the blank: The amount a company can call from its shareholders is known as ___ capital.

Called-up

What is the minimum subscription requirement according to SEBI regulations?

The minimum subscription must be at least 90% of the total offer for shares.

True or False: The Companies Act, 2013 allows companies to issue irredeemable preference shares.

False. The Act prohibits the issuance of irredeemable preference shares.

Explain what a company must do if it does not receive the minimum subscription for its share issue.

If the minimum subscription is not met, all application moneys must be refunded to the applicants within specified timeframes.