CRG660 - Full SS 2022 To 2019

FINAL ASSESSMENT
CRG660 – COMPANY SECRETARIAL PRACTICE

DATE: 8 FEBRUARY 2022
PART A
No Answer No Answer
1 A 21 D
2 B 22 D
3 B,C 23 B
4 C 24 B
5 A 25 A
6 A 26 D
7 A,B 27 D
8 A 28 D
9 C 29 A, B, D
10 B,D 30 D
11 A,B,C 31 A,B,D
12 C,D 32 A
13 B 33 A
14 D 34 A,B,C
15 C 35 A,C
16 B 36 B
17 D 37 A,C,D
18 D 38 B,C
19 D 39 C
20 C 40 C
PART B
QUESTION 1
A. Najah is a company secretary for BoardRoom Sdn Bhd, a well-known Malaysian company
that provides professional company secretarial service to private and public companies in
Malaysia. For the last few months, Najah has failed to contact the directors of JutaOne
Sdn Bhd, one of the BoardRoom’s clients. The firm tried all means of communication to
contact the directors, such as sending letters, emails but no positive reply was received.
None of the directors answered the phone calls either. Najah is now considering vacating
the office of the company secretary of JutaOne Sdn Bhd.
Required:
a. Discuss the relevant procedures according to the Companies Act 2016 that
allows the company secretary to vacate the office and the required documents
to be lodged with the Registrar.
(4 marks)
Resignation of a company secretary:
• Section 237 of Companies Act 2016 states that if no director is contactable at the last
known residential address, the company secretary may notify the Registrar of facts of
his intention to resign. √
• A secretary may submit a notice of intention to vacate the office of secretary to the
Registrar within 14 days of the company secretary’s resignation or vacation of office. √
• The notice must be accompanied with supporting evidences that none of the directors
can be communicated. √
• Where notice was given to the Registrar, the secretary ceases to be the company’s
secretary on the expiry of 30 days from the date of the notice lodged √.
b. Assuming Najah does not vacate the office of company secretary of

BoardRoom Sdn Bhd, assess whether Najah is held liable for any act or
omission in her capacity as a company secretary.
(6 marks)
Exclusion of liability of a company secretary:
• The company secretary is a corporate officer √. As such, he cannot be exempt from,

or indemnified in respect to any liability for negligence, default, breach of duty or
breach of trust, of which he may be guilty in relation to the company √.
• In this regard, if a company secretary had purchased a professional indemnity insurance,
Section 289 provides that a company shall not indemnify or directly or indirectly
effect insurance for an officer or auditor of the company in respect of (a) the liability
for any act or omission in his capacity as an officer or auditor; or (b) the costs incurred by
that officer or auditor in defending or settling any claim or proceedings relating to any
such liability. √√
• But a company may indemnify an officer or auditor of the company for any costs
incurred by him or the company in respect of any proceedings— (a) that relates to the
liability for any act or omission in his capacity as an officer or auditor; and (b) in which
judgment is given in favour of the officer or auditor or in which the officer or auditor is
acquitted or in which the officer or auditor is granted relief under this act, or where
proceedings are discontinued or not pursued. √√
B. Beruntung Sdn Bhd has been experiencing cash flow problems. In 2018, it borrowed RM1
million from Mercury Bank. The company secured the loan with the company’s land, and
the charge was registered with the Land and District Office but not with the Companies
Commission of Malaysia (SSM).
Later in 2019, Beruntung Sdn Bhd borrowed a further RM1 million from Mercury Bank.
The company secured the loan using its book debt and registered the charge with the
SSM.
Recently, the court made an order for the winding-up of Beruntung Sdn Bhd on the
application of Ezy Ringgit Sdn Bhd, a creditor who had, one year ago, granted the
company a loan on a floating charge, secured on all the assets and undertaking of the
company. The company registered the charge with the SSM, and a liquidator was
appointed.
Required:
a) Compare TWO (2) types of charges granted by Beruntung Sdn Bhd to Mercury Bank.
(4 marks)
Types of charges:
• A fixed charge is a charge created on a fixed asset of the company. √

• The charge attaches to the assets and therefore the company cannot sell or otherwise
dispose of the asset except with the prior permission of the lender. √
• The floating charge is usually created not on a specific asset of the company but on
a class of assets for example on receivables, book debts and undertakings of the
company. √
• After the creation of the charge, the company is free to continue to deal with or
dispose of the assets in the ordinary course of the company’s business, until the
lender takes steps to enforce their security or crystallisation otherwise occurs. √
b) Discuss the fixed charge registered with the SSM in favour of Mercury Bank and the
priority between the charges in favour of Mercury Bank and Ezy Ringgit Sdn Bhd.
(6 marks)
• Under the Companies Act 2016, charges which require registration must be
registered with the SSM within 30 days of their creation. √
• Thus, the fixed charge in favour of Mercury Bank should have been registered within 30
days of its creation. The fact that it was registered with the land office does not exempt
the company from registering the charge with the SSM. √
• Failure to register the charge within the stipulated period would render the charge void
against the liquidator and any creditor of the company. √
• Thus, the fixed charge will not be valid against Ezy Ringgit Sdn Bhd. Both liquidator and
Mercury Bank would become unsecured creditor with respect to the loan of RM1 million
granted to Beruntung Sdn Bhd. √
• Thus, Ezy Ringgit Sdn Bhd will have priority over the proceeds of the sale of the land. √
• With regards to Mercury Bank’s floating charge and Ezy Ringgit Sdn Bhd’s floating
charge, Mercury Bank will have priority as it was created and registered before Ezy
Ringgit Sdn Bhd’s floating charge. √
A. Terlajak Cantik International Bhd is a local cosmetic company that was recently
converted its status to a public company. The company currently has two directors, Datin
Hanisah and Datin Layla. Apart from the new strategic plan for the company, the
directors intend to appoint a new managing director and an additional non-executive
director. As the company secretary, they seek advice on the following matters:
a) The procedure to appoint a new Non-Executive Director in a public company
(6 marks)
Appointment of new directors in public companies must be made in a general

meeting √ by a single resolution unless it has been resolved without dissent to vote
on them together √, (s 203) This means that prior to the passing of the motion for
appointing the directors, there must first be a preliminary resolution √ passed
unanimously that decides to move a resolution for the appointment of the directors
in one resolution √. If this preliminary procedure is not complied with √, a resolution
purportedly appointing the directors in one resolution will be void √ and no one
named in that resolution will in fact have been appointed.
b) The terms of appointment as a Managing Director of the company

(4 marks)
The appointment of a managing director is usually provided in the constitution√ and

the board gives power to appoint a managing director. √ The constitution must first
be altered if there is no such provision in the constitution. √ The directors will decide
on the terms and conditions of the appointment and the managing director will sign
a contract of service. √ The managing director shall not, subject to the retirement by
rotation√ and that his appointment shall be terminated if he ceases from any cause
to be a director√ or when the contract expires. √ The board at any time may terminate
his office, even though his term of service has not yet expired. √
B. Mr Raymond is another non-executive director. Mr Raymond has not been given his total
commitment to his duties and responsibilities as a company director. Datuk Kassim is
annoyed with Mr Raymond's lack of commitment and asked whether there are any
provisions under the Companies Act 2016 to remove him.
(10 marks)
As the company they intend to incorporate is a public company (Berhad), Sec. 206 of the
CA 2016 applies to the removal of directors. √ Under Sec. 206, members of a public
company can remove a company director by passing an ordinary resolution. √ This means
the meeting requires a 14 days’ notice of meeting to be sent to members of the company.
√ The member who wishes to remove the director must give special notice to the company.
√ Special notice is defined in Sec. 206 which provides that the company must be given
prior notice of at least 28 days before the intended removal of the director. √ The company
must provide the director with a copy of the special notice as he has the right to defend
himself. √ The director can either provide a written response against his removal or can
attend and speak at the meeting that is held to remove him. √ The removal of the director
only takes effect when the ordinary resolution is passed by members at the general
meeting. √ Where the director that is to be removed represents the interest of a specific
class of shareholders that director cannot be removed unless his successor has been
appointed. √ Where a director’s removal results in the company having breached its
contractual obligations to the director, the director is not prevented from suing the
company for compensation. √
QUESTION 3
A company that ceased to exist as a corporate entity is planning to dissolve. The Registrar will
strike off the company's name from the Register of Companies, and the company shall also get
this fact published in the Official Gazette. Thus, the dissolution puts an end to the existence of
the company. The company may also dissolve by transferring the company's undertaking to buy
over another via a reconstruction or amalgamation scheme. In such a case, the transferor will
dissolve without being wound up. Secondly, it is through the winding up of the company. In this
manner, the company paid all its liabilities via the realization of the company's assets. The surplus,
if any, is distributed to the members of the company by their rights.
Required:
a) Determine the situation that the Registrar has the power under Section 549 to strike a
company off the register.
(6 marks)
a) The situation that the Registrar has the power under Section 549 to strike a company off the
register:
1) The company is not carrying on business or is not in operation√

2) The company has contravened the Act√
3) The company is being used for unlawful purposes or any purpose prejudicial to or
incompatible with peace, welfare, security, public interest, public order, good order or
morality in Malaysia√
4) In any case where the company is being wound up and the Registrar has reasonable
cause to believe that:
a. no liquidator is acting; √
b. the affairs of the company are fully wound up and for a period of six months the
liquidator has been in default in lodging any return required to be made by him; √
or
c. the affairs of the company have been fully wound up under a winding up by the
Court and there are no assets or the assets available are not sufficient to pay the
costs of obtaining an order of the Court dissolving the company. √
b) Justify any SIX (6) basis for any person to lodge a “Notice of Intention to Object Striking
Off of A Company Application” with the Registrar.
(6 marks)
b) SIX (6) basis for any person to lodge a “Notice of Intention to Object Striking Off of A Company
Application” with the Registrar:
1) That the company is still carrying on business or there is other reason for it to continue in
existence√
2) That the company is a party to legal proceedings√
3) That the company is in receivership or liquidation, or both√
4) That the person is a creditor or a member or a person who has an undischarged claim
against the company√
5) That the person believes that there exists and intend to pursue, a right of action on behalf
of the company√
6) That for any other reason, it would not be just and equitable to remove the company from
the register√
c) Explain any TWO (2) provisions applicable to every winding up regarding its books and
papers of the company.
(4 marks)
TWO (2) provisions applicable to every winding up in respect to books and papers of the
company:
1) Every liquidator shall keep proper books and papers in which he shall cause to be made
entries or minutes of proceedings at meetings, and any creditor or contributory may,
subject to the control of the Court, personally or by his agent inspect the proper books and
papers√√
2) When a company has been wound up, the liquidator shall retain the books and papers of
the company for a period of five years from the date of dissolution of the company and at
the expiration of that period, may destroy the book and papers√√
d) Discuss any FOUR (4) duties of the Registrar concerning the management of assets of a
dissolved company.
(4 marks)
d) FOUR (4) duties of Registrar with regard to management of assets of dissolved companies
after a company has been dissolved:
1) Registrar may represent the company or its liquidator to carry out, complete or give effect
to some dealing, transactions or matter if it is proved that the company would be legally
bound to do so√
2) Registrar may execute or sign any relevant instrument or document stating that he has
done and the execution or signature shall have the same force, validity and effect as if the
company is still existing√
3) Any outstanding property which was not realized or disposed off before the dissolution
shall be vested with the Registrar√
4) Registrar may sell or dispose off or deal with such estate or interest in property as he
thinks fit√
5) Property vested in the Registrar is subject to all charges, claims and liabilities imposed
thereon√
6) Registrar shall record in the register a statement of any property vested in him and keep
all accounts, vouchers, receipts and papers relating to the property and moneys√
FINAL EXAM JULY 2021
CORPORATE SECRETARIAL PRACTISE (CRG660)
PART A – 40 QUESTIONS (40 MARKS)

SUGGESTED SOLUTIONS
No Answer No Answer
1 True 21 C
2 False 22 D
3 A,C,D 23 B
4 A,C,D 24 B,C
5 A,B,D 25 A,C,D
6 True 26 True
7 False 27 D
8 D 28 A,C,D
9 B 29 False
10 True 30 B,C,D
11 B 31 True
12 A 32 C
13 False 33 A,C
14 B 34 A
15 A,B,C 35 C
16 A,B,C 36 False
17 False 37 A,B
18 True 38 B,C
19 A,B,C 39 B
20 C,D 40 True
PART B
SUGGESTED SOLUTIONS
QUESTION 1
PART A
For the past year, you have served as a company secretary for JWK Sdn Bhd. However, Encik
Amri, the company's sole director, has been tough to reach in recent months. You tried
sending electronic mail and WhatsApp messages but received no response. The letters sent
to his private address were returned. Even worst, he was not answering his phone.
You are considering resigning from your position as the company secretary of JWK Sdn Bhd.
a) Explain the steps you may take to vacate the office of a company secretary.
(5 marks)
In situation where none of the directors can be communicated with at the last known
address, Notice of Intention to Vacate the Office of Secretary √ should be submitted to
Registrar (CCM) √ and shall cease to be the secretary of the company on the expiry of
30 days √ from the lodgement of the notice. However, the secretary is not relieved from
liability √ for any act done or any omission before he or she vacates office√.
1
PART B
Encik Yusof has recently incorporated a public manufacturing company named Syntex Bhd
with two of his friends, Encik Danial and his wife, Puan Sara. They are also the first subscribers
and directors. You have been appointed as the first company secretary of Syntex Bhd and is
required to advise the board of directors about procedures upon incorporating a public
company. Immediately after getting a notice to commence business, you are required to
convene a board meeting to deal with certain formalities to commence business.
Before convening the first board of directors’ meeting, Encik Yusof requested information
regarding proceedings of the shareholders meeting, its requirements, and types of resolution.
He is also suggesting for a written resolution to be carried out to resolve the difficulties that
they will have to face in convening a shareholders meeting during this COVID-19 pandemic.
Required:
a) Explain briefly any six (6) agendas for the first board of directors’ meeting of Syntex Bhd.
(6 marks)
b) Describe the proceedings of the meeting relating to the quorum by Section 328,
Companies Act 2016.
(5 marks)
c) Advise Encik Yusof on the option of a written resolution during the COVID-19 pandemic
for Syntex Bhd as provided by the Companies Act 2016.
(4 marks)
(Total: 20 marks)
PART B
a) Explain briefly any six (6) agendas for the first board of directors’ meeting of Syntex Bhd.
(6 marks)
1. The statutory registers and common seal have to be ordered and produced at the first
meeting of directors.
2. A bank should be appointed and signatories to cheques designated.
3. Pre-incorporation contracts should be ratified and adopted, if any.
4. Stationery bearing the company’s full and correct name and company number must
be printed where the stationery is to be for outside use.
5. The registered office should be confirmed, and the proper sign affixed.
6. Books of accounts must be purchased. (Note that this is not within the scope of a
company secretary’s duties unless specified by the company.)
7. The design for share certificates must be prepared, adopted and printed.
8. Minute books for the various meetings — annual general meetings (AGMs) for a public
company, general meetings and directors’ meetings should be purchased.
9. Ensure that the necessary contracts for services are drawn up.
10. The first auditor must be appointed.
11. A tax agent or GST agent should also be appointed to take care or taxation and GST
matters.
b) Describe the proceedings of the meeting relating to the quorum by Section 328,
Companies Act 2016.
(5 marks)
2
● Quorum is the minimum number of members who must be present at the meeting. ( )
● Section 328(2) prescribed that there must be at least two members personally present
at a meeting( ) or by proxy unless a higher number is specified in the constitution. ( )
● Section 328(3) provides that in counting the quorum, members shall include proxy and
corporate representative. ( ) Thus, there is quorum even if no member is personally
present unless the company has only one member. ( )
● Section 328(4) provides quorum is required at the commencement of the meeting. ( )
However, it must be stressed that if the quorum is only two, then it must be maintained
throughout the meeting. There cannot be a meeting of one person. ( )
● The meeting should be adjourned if the number of attendees present at the meeting
falls below the quorums. This is because if the meeting proceeds without any quorum,
the validity of the proceedings when the quorum is not fulfilled in invalid. ( )
c) Advise Encik Yusof on the option of a written resolution during the COVID-19 pandemic
for Syntex Bhd as provided by the Companies Act 2016.
(4 marks)
● Written resolution is not allowed for Syntex Bhd. ( ) In accordance to Section

297(2) only private companies can pass a written resolution unless the resolution is
on the removal of a director or an auditor before the expiration of his term. ( )
● The written resolution may be proposed by the directors or by any member holding at
least 5% of the voting rights in the company. ( )
● The written resolution is passed once the required majority of members have signified
their agreement. ( )
QUESTION 2
Winding up a business is not the same as bankruptcy, though it is usually a result of

bankruptcy. Bankruptcy is a legal proceeding that involves creditors attempting to gain access
to a company's assets to settle the debt due by the company. Although there are various types
of bankruptcy, the proceedings can help a company emerge as a debt-free new entity and
usually smaller.
Winding up is the process of dissolving a company. While winding up, a company ceases to
do business as usual. Its sole purpose is to sell off stock, pay off creditors, and distribute any
remaining assets to partners or shareholders. Conversely, once the winding-up process has
begun, a company can no longer pursue business as usual. The only action they may attempt
is to complete the liquidation and distribution of its assets. At the end of the process, the
company will be dissolved and will cease to exist.
Required:
a. List six (6) persons who may petition to call for a compulsory winding up.
(6 marks)
b. Briefly describe the commencement of a compulsory winding up.

(4 marks)
c. If the company itself is the petitioner, briefly explain the procedure to wind up the
company.
(4 marks)
d. Since the company has difficulty paying its debts, explain three (3) circumstances when
a company is said to be unable to pay its debts.
(6 marks)
3
(Total: 20 marks)
SOLUTION
a. List six (6) persons:

- The company itself√
- A creditor√
- A contributory or personal representative of a contributory or the trustee of a
bankrupt contributory or the Director General of Insolvency√
- The liquidator√
- The Minister Charged with the responsibility for companies on the grounds under
section 465√
- Bank Negara Malaysia√
- The ROC√
- The Malaysia Deposit Insurance Corporation√
b. Briefly describe:
- The compulsory winding up commences on the day of the winding up order
(s467(2)). √√
- If the company passes a resolution to voluntarily wind up before the presentation
of winding up petition, the winding up commences at the passing of members’
resolution (s467(1)). √√
c. If the company itself is the petitioner, briefly explain the procedure:

- The company has passed a special resolution that the company be wound up by
the court (s465(1)(a)) √
- Then, either the company itself or a contributory of the company may present a
petition to wind up the company√
- The contributory must fulfil any of the conditions prescribed in section 464(2)(a) √
- It is immaterial whether the company is solvent or insolvent√
d. Explain three (3) circumstances:

- The creditor is owned a sum exceeding the amount prescribed by the Minister. √√
- The creditor has obtained judgement against the company. √√
- The court is satisfied that the company is unable to pay its debts after considering
the company’s contingent and prospective liabilities. √√
4
QUESTION 3
PART A
Senja Salju Sdn Bhd (SSSB) is a private company. The chairman of the company is seeking
your view on the following matters:
a. One of the shareholders, Puan Nur Huda, wants to give her shares worth RM25,000
to her son Encik Fauzi. However, she is confused between the transfer and
transmission of shares.
Explain with example the differences between transfer and transmission of shares.
(6 marks)
Solution:
Transfer
● Ownership of the share changes by voluntary act √

● The action involves only, the transferor, transferee and the company √
● Example: Owner sells his share to the new owner, giving away as a gift √
Transmission
● Ownership of the share changes by operation of law √

● The transmission might also involve other parties such as administrator, receiver,
and even a court order may also be required. √
● Example: transmission of shares due to death, bankruptcy or lunacy √
b. Briefly explain FOUR (4) reasons for a company to purchase its shares.
(4 marks)
Solution:
The reasons for a company to purchase its shares are:
● To support, share price during a depressed period by controlling demand and
supply of the shares. √
● To distribute surplus cash to shareholders in lieu of cash dividends. √
● To improve capital structure – to modify leverage, gearing and debt equity
ratio. √
● To provide a means for utilizing surplus cash.
● Defense against a hostile takeover attempt by reducing public shareholding.
(to mitigate hostile takeover) √
PART B
5
Registration of charges with the CCM is designed to assist the secured creditor and at the
same time give notice to all those doing business with the company of the total amount of the
company’s debts. The CA 2016 provides that certain charges given by companies must be
lodged for registration with the Registrar.
Required:
a. List any SIX (6) categories of charges that must be lodged with the Registrar for
registration.
(6 marks)
b. The statement containing Particulars of a Series of Debentures must be registered with

the registrar within 30 days from the date of execution of the instrument.
Briefly explain the particulars of the statement.

(4 marks)
(Total: 20 marks)
SOLUTION
PART B:
a. Any six of the followings:
(1) charges to secure any issue of debentures
(2) charges on uncalled share capital of a company
(3) charges on shares of a subsidiary of a company which are owned by the company
(4) charges created by an assignment created or evidenced by an instrument which if
executed by an individual within Peninsular Malaysia and affecting property within
Peninsular Malaysia would be invalid or of limited effect if not filed or registered under
the Bills of Sale Act 1950
(5) charges on land wherever situated or any interest in the land
(6) charges on book debts of the company
(7) floating charges on the undertaking or property of the company
(9) charges on ships or aircrafts or any share in a ship or aircraft;
(10) charges on goodwill, patents or licence under a patent, trade mark, or on a
copyright or a licence under a copyright;
(11) charges on the credit balance of the company in any deposit or account.
b. The FOUR (4) particulars are:

(a) the total amount secured by the whole series;
(b) the dates of the resolutions authorising the issue of the series and the date of the
covering instrument, if any, by which the security is created or defined;
(c) a general description of the property charged; and
(d) the names of the trustee, if any, for the debenture holders.
6
CONFIDENTIAL 1 AC/FEB2021 ODL/CRG530/660
UNIVERSITI TEKNOLOGI MARA

FINAL EXAMINATION
COURSE : COMPANY SECRETARIAL PRACTICE
COURSE CODE : CRG530/660
DATE : 16 FEBRUARY 2021
TIME : 9.00 – 12.00 NOON (3 HOURS)
SUBMISSION TIME : 12.00 NOON – 12.30 PM (30 MINUTES)
INSTRUCTIONS TO CANDIDATES
1. This question paper consists of TWO (2) parts: PART A (40 Questions)
PART B (3 Questions)
2. Answer ALL questions from PART A and PART B in the ODL platform provided by the
examiner.
3. Please check to make sure that this examination pack consists of:
i) the Question Paper
4. Answer ALL questions in English.
DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO

This examination paper consists of 11 printed pages
© Hak Cipta Universiti Teknologi MARA CONFIDENTIAL

FINAL EXAM
CORPORATE SECRETARIAL PRACTISE (CRG660)
SUGGESTED SOLUTION
PART A – 40 QUESTIONS (40 MARKS)
No Answer No Answer
1 C 21 A,B,C
2 True 22 C,D
3 A 23 A
4 False 24 False
5 D 25 A,C
6 C 26 True
7 D 27 D
8 C 28 B,C
9 A,B 29 A,D
10 False 30 True
11 D 31 True
12 False 32 B
13 D 33 False
14 False 34 True
15 False 35 A,B,C
16 C 36 False
17 True 37 A,B
18 False 38 D
19 True 39 B
20 False 40 C
PART B
SUGGESTED SOLUTIONS
QUESTION 1 (A)
Dato’ Tazzudin Ramzey, a professional engineer and Datuk Kushairie Ahmad, a

professional architect have decided to venture into a property development business after
having been in employment for more than 25 years. Although their business, TRKA Bhd,
has only been in operation for the last 1 year, they manage to secure many big projects. In
fact, getting approval for bank facilities is not an issue for them. As experts in their
respective professions, they still lack the experience and know-how of managing a
company. They are aware that any non-compliance to rules and regulations can tantamount
to heavy penalties under the Companies Act 2016 (CA 2016) and also by the Regulators.
Hence, they intend to bring in more independent directors into the company and have seek
your advice on some pertinent issues. As a company secretary, it is your duty to advise on
the following areas of concern.
Required:
a) Briefly explain three (3) criteria of a non-executive director

(3 marks)
The criteria are:
i. He does not receive salaries and benefits because they do not hold
any management posts
ii. He receives a director fees which is determined by the
member/shareholder at general meeting
iii. Their sole function is to determine/agreed the overall policy of the
company, contribute to discussion and decision making.
iv. Carries independent function in BOD
(Any 3 x 1 mark = 3 marks)
b) Discuss the items to be included in the declaration a person before he can be

appointed as a director of a company.
(4 marks)
The directors have to make a declaration covering the followings:
i. He is not an undischarged bankrupt

ii. He has not been convicted whether within or outside Malaysia any
offence
iii. He has not been imprisonment for any offence within the period of 5
years immediately preceding the date of the declaration
iv. He consents to act as director of the company
(4 x 1 mark = 4 marks)
c) Discuss the effect of disqualification of a person as director of a company.

(6 marks)
The effects of disqualification of a director are as follows:
i A director is guilty of an offence if he still holds office as a director

whether directly or indirectly. However, any acts carried out by him
remain valid although he is disqualified.
ii The director shall be responsible for any defects found during his
appointment that may be discovered later with regards to his
disqualification
iii The reason is to protect the outsiders/public who have entered into
transactions with the company
iv If there is only one director in the company, and he is disqualified,

effectively the company without director and his office is vacated upon
happening of any of those events.
v Upon disqualification of a director, a casual vacancy is created and the

BOD shall have power to appoint any person to fill the casual vacancy
QUESTION 1(B)
Companies listed on Bursa Malaysia are permitted to buy back their own shares from the
stock brokers and such shares are called treasury shares. CA 2016 provide that where
shares are held as treasury shares, the company shall hold such shares in a securities
account in accordance with the relevant rules of the stock exchange or the central
depository as defined in section 146, as the case may be.
Required:
a) Provide three (3) actions that can be made by directors of the company pertaining to
treasury shares
(3 marks)
b) Explain the impact on the shareholders whose shares are being bought back by the
company
(4 marks)
ANSWER:
Companies listed on Bursa Malaysia are permitted to purchase back their own shares from
the stock brokers and called such shares as treasury shares. CA 2016 provide that where
shares are held as treasury shares, the company shall hold such shares in a securities
account in accordance with the relevant rules of the stock exchange or the central
depository as defined in s 146, as the case may be.
Required:
a) Provide three (3) actions that can be made by directors of the company pertaining to
treasury shares
(3 marks)
i) distribute the treasury shares as dividends to shareholders, such
dividends to be known as “share dividends”;
ii) resell the treasury shares or any of the treasury shares in accordance with
the relevant rules of the stock exchange;
iii) transfer the shares, or any of the shares for the purposes of or under an
employees’ share scheme;
iv) transfer the shares, or any of the shares as purchase consideration;
v) cancel the shares or any of the shares; or
vi) sell, transfer or otherwise use the treasury shares for such other purposes
as the Minister may by order prescribe.
b) Explain the impact on the shareholders whose shares are being bought back by the
company
i) No right to attend or vote at meetings and any purported exercise of such

rights is void;
ii) and No right to receive dividends or other distribution, whether cash or
otherwise, of the company’s assets including any distribution of assets
upon winding up of the company.
(2 x 2 = 4 marks)
(Total: 20 marks)
QUESTION 2
The annual general meeting (AGM) season for Singgah Maju Bhd is currently under way,
with a financial year ending on 30 June each year. However, due to the outbreak of Covid-
19, the company should rethink its arrangements for the AGM, taking into consideration the
potential bans on large gatherings, travel restrictions and the risk that venues selected for
the meetings may not be available due to unexpected closures.
The Board of Directors of Singgah Maju Bhd called for an urgent meeting to discuss on the
possibility of holding the current year AGM virtually. The previous AGM of the company was
held on 15 November 2019. As the company secretary, you are required address the
following issues:
a) Discuss briefly the last date for convening the AGM 2020 in accordance with the CA
2016
(5 marks)
Sec. 340 of the CA 2016 provides that every public company must convene AGM
in every calendar year.
The AGM shall be held within 6 months of the company’s financial year end ; and
not more than 15 months after the last preceding AGM.
After considering all factors above the AGM shall be convened latest by 31
December 2020.
However, the company may apply to CCM to extend the period of 15 or 18 months
and CCM may if it thinks fit extend the period.
b) Explain how the requisite of a valid meeting in the AGM still can be fulfilled when it is
being conducted virtually.
(6 marks)
The requisites of a valid meeting are as follows:
1. Meeting must be properly convened
A notice of the meeting should be issued to every member, director and

auditor of a company. A notice of the meeting must clearly state that the
meeting will be “Fully Virtual” and should contain the necessary information
(such as the place where it is going to be broadcast live, time, date and the
type of meeting)
.
2. Meeting must be properly constituted.
Quorum is the minimum number of persons who must be present at the

meeting. A member has the right to appoint another person to attend the
meeting on his behalf, known as a member’s proxy. CA 2016 does not specify
the maximum number of proxies that a member can appoint. Shareholders will
NOT be physically present at the broadcast venue on the day of the AGM.
Thus, shareholders shall register their attendance remotely by using the
Remote Participation and Voting (RPV) facilities.
3. Meeting must be properly conducted
The constitution usually provided for the appointment of a chairman.

Generally, meetings are conducted by voting by hand, unless voting by poll is
demanded and the chairman may decide to vote by hand or by poll. In virtual
AGM Remote Participation and Voting (RPV) facilities also going to be used for
counting the vote.
c) Explain the general rules on voting with regards to section 293(1) of Companies’ Act
2016.
(4 marks)
1. In the case for companies having a share capital

(a) On a vote on a written resolution, every member shall have one vote in
respect of each share or stock hold by him.
(b) On a vote on a resolution on a show of hands at a meeting, every member
shall have one vote.
(c) On a vote on a resolution on a poll taken at a meeting, each share is
entitled one vote.
2. In the case for companies not having a share capital, every member shall
have one vote.
d) Explain to the Board, your action plans to ensure that future AGMs of the company will
be held effectively and are well prepared for any possibilities.
1. Confirm the date of the meeting with the board, registrars, advisers and
others required to attend.
2. Estimate number of attendees.
3. Prepare and send out notices of meeting, annual reports and proxy form.
4. Organize and book suitable venue for the meeting.
5. Prepare and discuss with the Chairman an order of proceedings, setting out
various resolutions to be passed at the meeting.
6. Ensure the Chairman is primed with a suitable script to deal with the meeting
so that he (or she) is not taken completely by surprise.
7. Make appropriate arrangements in accordance to the current scenario. For
example, consider the layout of the meeting room and make sure there will be
some distance between the board and the attendees.
8. If necessary, employ a security organization for the meeting taking into
consideration the state of security in the country.
(Any 5 x 1 mark = 5 marks or any suitable answers)
(Total: 20 marks)
QUESTION 3
Muntajat Sdn Bhd (MSB) is a SME with its registered office in Sepang, Selangor. It was
incorporated in January 1995 as “Muntajat Manzila Sdn Bhd” before becoming a public
listed company in 2002 under the then second board of the Kuala Lumpur Stock Exchange
(now Bursa Malaysia). The public listed company used the name “MM Bhd” and was mainly
involved in the production of halal household products.
After 7 years of profitable business, MM Bhd faced serious setbacks in its business
operations due to poor governance and declining demand for its products. Some of its
business assets have to be sold in 2010 to repay its loans, and some of the assets were
placed under receivership. Finally, in 2013, MM Bhd sold its business to another public
listed company. Through a series of share buybacks and capital reduction exercises, MM
Bhd managed to downsize the company and in 2017 finally changed its status into a private
limited company, using the name Muntajat Sdn Bhd (MSB).
MSB is practically a dormant company with the exception of a few activities. It still pays a
regular payment to July Bank Bhd (JBB) for the piece of land and the building used as its
registered office. Both assets have been charged to JBB. It also spends on administrative
expenses. In 2019, the Board decided to cease the operation of the company.
Required
a. Is it possible for MSB to apply for deregistration? Explain.

(3 marks)
No. The company still have assets, outstanding liabilities, and entries at the
registrar of charges .
b. Since MSB has not been actively involved in business, JBB is concerned that MSB may
not be able to make its installment and finally finishes its loan.
i. What can JBB do to recover its loan?

(2 marks)
JBB can apply to the court to appoint Receivers and Managers to take control
of the charged assets with a view of disposing them in order to settle the debts
owing to JBB.
(2 at 1 mark each = 2 marks)
** Give one mark is student’s answer is “apply for compulsory winding up”.
ii. Explain the process of compulsory winding up.

(6 marks)
First, an aggrieved party will petition to the court to issue an order for the
company to be dissolved. The court will decide, based on the evidences, if a
compulsory winding up order is just and equitable to all parties
Next If the court issues dissolution order, the company will call up
i. an EGM to pass a special resolution to dissolve the company
ii. A creditor meeting to approve the appointment of liquidator and appoint
an inspection committee.
Finally The liquidator will collect the assets of the company, realize them
and pay off the creditors.
iii. Explain the effects of a liquidator’s (3 marks)

appointment in a dissolution
• the directors' powers will

cease
• any transfer of shares or any alteration in the status of members will be

void
• business activities must cease (unless as allowed by the liquidator).
iv. Explain the functions of a committee of inspection in the dissolution process

(4 marks)
i. To advise and assist the liquidator of the company;

ii. To give directions to the liquidator of the company;
iii. To monitor the conduct of the liquidator of the company;
iv. Such other functions as are conferred under the Act;
v. To do anything incidental of conducive to the performance of any of the
above functions
(Any 4 at 1 mark each = 4 marks)
c) If the investigation of the liquidator of a company undergoing member’s voluntary

dissolution discovered that for the past 6 months the company was unable to fulfil its
obligations. Suggest a tentative option that the liquidator should take.
(2 marks)
The liquidator will need to arrange for a creditor’s voluntary liquidation

(Total 20 marks)
CONFIDENTIAL 1 AC/JULY2020 ODL /CRG530/660
UNIVERSITI TEKNOLOGI MARA

FINAL EXAMINATION
SOLUTION
COURSE : COMPANY SECRETARIAL PRACTICE

COURSE CODE : CRG530/660
EXAMINATION : JULY 2020 ODL
TIME : 2 + 2 HOURS

PART A
Seksyen 1 – TRUE FALSE
THERE ARE 15 TRUE/FALSE QUESTIONS IN THIS SECTION. ANSWER ALL

QUESTIONS
No Answer
1 F
2 F
3 F
4 F
5 F
6 T
7 F
8 T
9 T
10 T
11 F
12 F
13 F
14 T
15 T
Seksyen 2 - MULTIPLE CHOICE QUESTIONS
THERE ARE 15 MULTIPLE CHOICE QUESTIONS IN THIS SECTION. ANSWER ALL

QUESTIONS
No Answer
16 C
17 C
18 C
19 B
20 C
21 C
22 D
23 B
24 C
25 C
26 D
27 B
28 B
29 C
30 D

Section 3 - Check boxes
THERE ARE 10 CHECK BOXES QUESTIONS IN THIS SECTION. ANSWER ALL

QUESTIONS. YOU MAY NEED TO CHOOSE MORE THAN ONE ANSWER FOR EACH
QUESTION.
No Answer
31 D
32 C
33 ABCD
34 CD
35 AB
36 A
37 ACD
38 D
39 C
40 C

PART B
QUESTION 1
Gary, Larry and Jerry have recently incorporated Protiga Chemicals Sdn Bhd. The company
was incorporated on 3 August 2019 with its principal activity in the chemical engineering
industry. All three of them were appointed as the directors of the company. The agenda of
the first board of directors’ meeting, which was scheduled for 10 August 2019 includes the
appointment of Chris Lee as the Managing Director who will be responsible for the overall
activities of the company’s operations. As a newly appointed and inexperienced board of
directors, Gary, Larry and Jerry also wish to propose that the directors of the company be
given loan facilities for personal use.
Required:
a. Discuss the terms of appointment for a Managing Director.

(6 marks)
SUGGESTED ANSWER
The appointment of a managing director is usually provided in the constitution√ and the
board gives power to appoint a managing director. √ The constitution must first be
altered if there is no such provision in the constitution. √
The directors will decide on the terms and conditions of the appointment and the
managing director will sign a contract of service. √ The managing director shall not,
subject to the retirement by rotation√ and that his appointment shall be terminated if he
ceases from any cause to be a director√ or when the contract expires. √ The board at
any time may terminate his office, even though his term of service has not yet expired.
√
(Any 6√ x 1 mark each = 6 marks)
b. In your own words, state the required form and the declaration to be made by a person
before his appointment.
(6 marks)
SUGGESTED ANSWER
The form is known as - Declaration by a person before appointment as director or by a

promoter before incorporation of a corporation. √
Declarations to be made by a director:

 He is not an undischarged bankrupt √
 He has not been convicted of any offence:
- In connection with the promotion, formation or management of a corporation √
- Involving fraud and dishonesty punishable on conviction with imprisonment for
three months or more; or √
- Under Companies Act 2016 (liability where proper accounts not kept) within a
period of five years preceding the date of declaration √
 He has not been imprisoned for any offence referred to (ii) above within the period
of five years immediately preceding the date of the declaration √
 He has consented to act as a director of the company √
(Any 6√ x 1mark each = 6 marks)

c. In your own words, advise Gary, Larry and Jerry on the relevant provisions in the
Companies Act 2016 on loans to directors and the exceptions to the rule.
(8 marks)
SUGGESTED ANSWER
Loans to directors
Section 224 of the Act states that a company (other than an exempt private company)
√ shall not
 Make a loan to a director of the company, or √
 Make a loan to a director of a company which is deemed to be related to the
company. √
 Enter into any agreement or provide any security in connection with a loan made
to such director. √
Exceptions to the rule are:
 Funds provided to a director to meet expenditure incurred or to be incurred by him

for the purpose of the company or for purpose enabling him to perform his duties. √
 Funds were given by the company to a director who is engaged in the full-time
employment√ of the company or its holding company to meet expenditure incurred
or to be incurred by him in purchasing or acquiring a home. √
 Any loan given to a director who is engaged in the full-time employment √ of a
company or its holding company, where the company has at a general meeting
approved of a scheme for the making of loans to employees of the company. √
(8√ x 1 mark each = 8 marks)
(Total: 20 marks)2
QUESTION 2
Vector Bhd is a developer company planning to expand its business into the construction of
property building. In the board of directors’ meeting, the directors deliberated over the choice
of issuing either shares or debentures to finance the project. The majority of the board
members agreed to finance the project through issuance of debentures to avoid the control of
outsiders (new member).
The chairman requests the company secretary to give clarification on shares issuance and on
the types of debenture to issue to the public. In addition, they are not sure on the types of
charge that may attach to the debentures and seek further explanation on the issues above.
a. Explain to the board of directors of Vector Bhd the various options available for them to
issue share capital.
(6 marks)
SUGGESTED ANSWER
1. Public issue √
A direct allotment, where the shares are issued and allotted directly to members of
the public who have subscribed the shares. √
2. Offer for sale √

A company allots or place shares to an issuing home which then will offer them for
sales to the public. Where a private company seeks to ‘go public’, a portion of the
shares held by the existing shareholders may be offered for purchase by members
of the public. √
3. Right issue √
A right is an offer (in contractual sense) to the existing members of a Vector Bhd of
new share for subscription. √
(6√ x 1 = 6 marks)
b. In your own words, explain the characteristic of debentures.

(4 marks)
SUGGESTED ANSWER
Characteristics Explanation
1.Form The form of debenture. Eg debenture stock, loan stock, bond,
redeemable debenture.
2.Redeemability Whether redeemable with a specified period or only upon the

occurrence of various specified contingencies.
3.Security Whether secured on the property or undertaking of the company

or not and if secured, whether by way of fixed or floating charge.
4.Interest The interest the debenture yield.
(8√ x ½ = 4 marks)
c. In your own words, Briefly explain the phrase “crystallization of floating charge”. State
the events that may cause the crystallization of the charge.
(4 marks)
SUGGESTED ANSWER
“crystallization of floating charge” means floating charge will be converted to fixed charge.
√
Events that cause crystallization:
i) Default in repayment of interest and principal sum √

ii) On the commencement of winding up or when the company cease business √
iii) When there is a clause charge will crystallization upon breach of certain
condition. √
(4√ x 1 = 4 marks)
d. Discuss the circumstances where the issuance of debentures is preferred than the
issuance of shares.
(6 marks)
SUGGESTED ANSWER

i. When company wishes to obtain addition capital for investments but existing
shareholders do not wish to lose control of company. The issuance of new ordinary
shares would confer the shareholders full right of voting and thereby the shareholder
will be able to participate in the running of the company.
For the issuance of debentures, the holders of the debentures do not have rights to
vote at a general meeting hence holders have no special ability to exercise control and
participate in the running of the company. √√
ii. When company wishes to obtain capital for investment but existing shareholders do
not wish their existing shares to be diluted. The issuance of debentures with no rights
for conversion into equity shares on maturity would help the company to achieve its
objective to secure adequate financing while conserving the shareholders’ rights (no
dilution of shareholders’ shareholding). √√
iii. When company wishes to obtain additional capital for investments but existing
shareholders want their exposure to be quantified and no sharing of future profits. The
interest payable on the debentures is usually fixed on issuance, though normally higher
than the prevailing interest rate to attract takers. The company would be able to
calculate and know the total amount of interest to be paid on borrowings. In addition,
when company made much profits, such profits need not be shared as in the case for
issuance of ordinary shares where all shareholders would be entitled to dividend if a
dividend is declared on the shares. √√
(6√ x 1 = 6 marks)
(Total: 20 marks)
QUESTION 3
Due to some bad business decisions, Lingkup Berhad had to face heavy losses and some of
its members had decided to leave the company. Additionally, the company has difficulty in
fulfilling the payment of its debts.
With a few members left in the company, they are seeking for information on how to
compulsorily wind up the company. You are to advise the company secretary of Lingkup
Berhad on several information needed by the members.
Required:
a. List six (6) persons who may petition to call for a compulsory winding up.
(6 marks)
SUGGESTED ANSWER
- The company itself√

- A creditor√
- A contributory or personal representative of a contributory or the trustee of a
bankrupt contributory or the Director General of Insolvency√
- The liquidator√
- The Minister Charged with the responsibility for companies on the grounds under
section 465√
- Bank Negara Malaysia√

- The ROC√
- The Malaysia Deposit Insurance Corporation√
(Any 6√x1mark = 6marks)
b. Briefly describe the commencement of a compulsory winding up.

(4 marks)
SUGGESTED ANSWER
- The compulsory winding up commences on the day of the winding up order

(s467(2)). √√
- If the company passes a resolution to voluntarily wind up before the presentation
of winding up petition, the winding up commences at the passing of members’
resolution (s467(1)). √√
(4√x1 mark = 4 marks)
c. If the company itself is the petitioner, briefly explain the procedure to wind up the
company.
(4 marks)
SUGGESTED ANSWER
- The company has passed a special resolution that the company be wound up by
the court (s465(1)(a)) √
- Then, either the company itself or a contributory of the company may present a
petition to wind up the company√
- The contributory must fulfil any of the conditions prescribed in section 464(2)(a) √
- It is immaterial whether the company is solvent or insolvent√
(4√x1mark= 4 marks)
d. Since the company has difficulty in paying its debts, explain three (3) circumstances
when a company is said to be unable to pay its debts.
(6 marks)
SUGGESTED ANSWER
- The creditor is owned a sum exceeding the amount prescribed by the Minister. √√
- The creditor has obtained judgement against the company. √√
- The court is satisfied that the company is unable to pay its debts after taking into
account the company’s contingent and prospective liabilities. √√
(6√x1 mark = 6 marks)
(Total: 20 marks)
END OF QUESTION PAPER

FOR INTERNAL USE ONLY 1 AC/DEC 2019/CRG660
PART A
Answer ALL questions.
1. State the main characteristics of a company limited by guarantee.

(4 marks)
The main characteristics of a company limited by guarantee are:
The liability of its members is limited by the Memorandum of Association to the amount
to which the members have undertaken or ‘guaranteed’ to contribute to the assets of the
companion winding up. √
The company must be incorporated as a public company. √
The name for guarantee companies shall have the word ‘Berhad’ or ‘Bhd’ at the end of
its name unless it has obtained the license from the Ministry of Domestic Trade and
Consumer Affairs to dispense with the word ‘Berhad’ or ‘Bhd’. √
The company is usually formed by trade associations, charitable bodies, professional

and learned societies or social or sport clubs for the purpose of providing art, science,
religion, charities, services or any other useful purpose for the community. √
(4√ x 1 = 4 marks)
2. Identify any TWO (2) similarities between a Limited Liability Partnership and a Limited
Company.
(4 marks)
Any debts and obligations of the LLP will be borne by the assets of the LLP and not
that of its partners’. √
An LLP has the legal status of a body corporate which is capable of suing and being
sued in its own name√, holding assets and doing such other acts √ and things in its
name as bodies corporate may lawfully do and suffer. √
(4√ x 1 = 4 marks)
3. Briefly explain the FOUR (4) circumstances that can lead the Companies Commission
of Malaysia (CCM) to initiate the deregistration of a company.
(4 marks)
The circumstances that can lead the CCM to Initiate the deregistration of the
company are: -
The company is not carrying business or is not in operation. √
The company has contravened this Act. √

The company is being used for unlawful purposes or any purpose prejudicial to or
incompatible with peace, welfare, security, public interest, public order, good order or
morality in Malay. √
In any case where the company is being wound up and the Registrar has reasonable
cause to believe that (any 1 √):
No liquidator is acting√
The affairs of the company are fully wound up and for a period of six months the
liquidator has been in default in lodging any return required to be made by him√
The affairs of the company have been fully wound up under a winding up by the
Court and there are no assets or the assets available are not sufficient to pay the
costs of obtaining an order of the Court dissolving the company√
(4√ x 1 mark = 4 marks)
4. Outline FOUR (4) categories of company names prohibited by virtue of the direction of
the Minister.
(4 marks)
Prohibitions by virtue of the direction of the Minister
i. Names suggesting connection with a member of the Royal family or Royal

patronage √
ii. Names suggesting connection with a State or Federal government department,
statutory body, authority or government agency or any municipality or other
local authority√
iii. Names suggesting connection with any Asean, Commonwealth or foreign
government or with the United Nations or with any other international
organization or cartel √
iv. Names suggesting connection with any political party, society, trade union,
cooperative society or building society; √
v. Names that are misleading as to the identity, nature, objects or purposes of a
company or in any other manner; √
vi. Names that are blasphemous or likely to be offensive to members of the public√
vii. Names including the following words or any words of like import:
“Bank”, “Banker”, “Banking”, “Bumiputra”, “Bureau”, “Chamber of Commerce
and Industry”, “Chamber of Manufacturers”, “Chartered”, “College”,
“Consumer”, “Council”, “Credit”, “Exchange”, “Executor”, “Fair Price”,
“Finance”, “Foundation”, “Fund”, “Guarantee”, “Institute”, “Insurance”,
“Investment”, “Leasing”, “Made in Malaysia”, “Prime”, “Registry”, “Treasury”,
“Trust”, “Unit Trust”, “University” √
viii. Names which:
a) are translations of a name of a company or foreign company already
registered under CA2016; √
b) may resemble or be mistaken for the name of any other company or foreign
company registered under CA2016; √
c) may resemble or be mistaken for a name that is being reserved for the
purpose of incorporation of a new company or registration of a foreign
company or for the purpose of a change of name of a company or foreign

company registered under CA2016. √
(Any 4√ x 1 mark = 4 marks)
5. Determine FOUR (4) contents in the Register of Members as mentioned in Section 50

(1) of the Companies Act 2016.
(4 marks)
The contents that shall be included in the Register of Members:
The names, addresses, the number of the identity card, nationality and the usual place
of residence of any person who is a member. √
Where any member is a corporation, the corporate name, place of incorporation,

establishment or origin, registration number and registered office of the corporation shall
be included. √
A statement of the shares held by each member if a company having a share capital. √
The date at which the name of each member was entered in the register√
The date at which any person ceases to be a member during the previous seven years.
√
The date of allotment and the number of shares allotted to each member. √
The amount of stock units held by each member if the company has converted its shares
into stocks. √
The names and particulars of persons ceased to be members may be kept separately.
√
(Any4√ x 1 = 4 marks)
6. Briefly explain the terms an associate director and an alternate/substitute director.

(4 marks))
Associate directors are senior executive directors of the company√
They are not directors within the meaning of the Act because they will expressly deny
their rights to attend or vote at any board meetings√
Alternate directors must give their consent to act and duly execute form-Declaration by
person before appointment as director√
They are entitled to notice of meetings, attend, and vote to exercise all powers of the
principal directors in their places√
(4√ x 1 = 4 marks)
7. A public company may finance their operations through issuance of debentures.

Determine FOUR (4) rights of debenture holders.
(4 marks)
The rights of a debenture holder are as follows:

The right to receive the audited financial statements√
The right to sue for repayment√
The right to take possession of the charged assets√
The right to appoint a receiver and/or manager√
The right to take action under section 346 if it is oppressed. √
(Any 4√ x 1mark = 4 marks)
8. Briefly explain FOUR (4) reasons for a company to purchase its own shares.
(4 marks)
The reasons for a company to purchase its own shares are:

- To support, share price during a depressed period by controlling demand and
supply of the shares. √
- To distribute surplus cash to shareholders in lieu of cash dividends. √
- To improve capital structure – to modify leverage, gearing and debt equity ratio. √
- To provide a means for utilizing surplus cash. √
- Defense against a hostile takeover attempt by reducing public shareholding. √
(Any 4 √ x1 mark = 4 marks)
9. Outline the situations for a resignation of a company secretary.

(4 marks)
According to section 237 of the Companies Act 2016:

- Subject to the constitution or the terms of appointment of a company secretary
may resign by giving notice to the Board. √
- If none of the directors can be communicated √
- On the expiry of thirty days from the date of the notice lodged or in the constitution
or agreement √
- On the expiry of thirty days from the date of the notice to the Registrar √
10. Determine FOUR (4) qualifications of a liquidator as provided by Section 433 of the
Companies Act 2016.
(4 marks)
A liquidator in a winding up shall not be qualified if:

-he is not an approved liquidator√
-he is indebted to the company exceeding twenty-five thousand ringgit√
-he is an officer of the company√
-he is a partner, employer or employee of an officer of the company√
-he is a partner or employee of an employee of an officer of the company√
-he assigns his estate for the benefit of his creditors or made an arrangement with his
creditors√
-if he becomes bankrupt√
-if he convicted an offence involving fraud or dishonesty by imprisonment for three
months or more√
(Total: 40 marks)

PART B
QUESTION 1
Your managing director, Mr. Johari Johan brought his business associate from London,
Madam Clementine Brawn, to your office. Madam Clementine informed you that she had
decided to make Malaysia as her investment hub after seeing positive changes in the
Malaysian business environment. Prior to making any capital commitment, Madam
Clementine wishes to know more about the various instruments of investment available in
Malaysia. You, as a company secretary, are requested to assist Madam Clementine in
answering all her queries.
Required:
a. Explain briefly how debentures may be differentiated in Malaysia.

(6 marks)
SUGGESTED ANSWER:
Debentures may be differentiated in Malaysia as follows:
i. Form - the form of the debentures. E.g. Debenture Stock, loan stock,
bond√
ii. Redeemability - whether redeemable within a specified period or only the
occurrence of various specified contingencies√
iii. Security - whether secured on the property or undertaking of the company
or not and if secured whether by way of a fixed or a floating charge√
iv. Interest - the interest (Coupon rate) charges for the debenture√
(4√ x1.5 mark = 6 marks)
b. Outline the procedures to issue debentures in Malaysia.

(6 marks)
SUGGESTED ANSWER:
The procedures are:
1. To ensure compliance with various guidelines on the regulatory framework

√ for issuance of debentures such as Securities Commission Act (SCA),
Companies Act (CA) and Financial Services Act √.
2. Preparation of a prospectus
A prospectus must be prepared√in accordance with debentures
prospectus guidelinesas S.159 of CA2016 defined as any prospectus,
advertisement, notice, invitation or circular (‘PANIC’) inviting applicants or
offers to the public to subscribe for or purchase any shares or debenture of
a company√.
3. Underwriting
Underwriting is not mandatory where it is up to the company and the
adviser to undertake√.
i. If no underwriter, the company must state the minimum level of

subscription necessary to achieve the funding objective of the
company (0.5 √).
ii. Where in the event of under-subscribe, cannot meet the minimum
level requirement, all proceeds must be returned to subscribers
(0.5 √).
4. Rating
All issues of debentures must be rated by a recognized rating agency √
unless otherwise exempted by SC. However, no mandatory rating is
required for any issue, offer or invitation in respect of irredeemable
convertible loan stocks√.
5. Registration of charges
According to S.352 (1) of CA2016, when a charge is created to secure the
debentures√, the details of the charges must be lodged with CCM within 30
days of creation√. Failure in doing so could lead contravened S.354 where
the officer and the company could be penalized for an amount of not
exceeding RM50,000 and additional of RM500 per day for further
offences√. (ANY 2 √)
(Any 6√ x 1mark =6 marks)
c. Discuss the qualification of the trustee for debenture holders according to section
176 of Companies Act 2016.
(8 marks)
SUGGESTED ANSWER:
The qualification of trustee for debenture holders according to S.176 of Companies

Act 2016 are:
◼ S 176 (1) - Every company which offers debenture for public subscription shall
only appoint a trustee corporation as a trustee√√
◼ S 176 (2) - The consent to act as trustee must be obtained before the trustee
corporation can act as a trustee of debenture holders√√
◼ S 176 (3) - A trustee corporation shall not be appointed as a trustee if that
trustee corporation is:-
a) A shareholder of the borrowing co√;
b) Beneficiary entitled to moneys owed by the borrowing company
(Borrowing company borrowed monies, then pass the monies to trustee)
√;
c) A corporation that has entered into a guarantee in respect of principal
debt secured by those debentures or in respect of the interest thereon√;
and
d) Deemed to be related to the corporation as mentioned in Para (1) to (3)
above and also related to the borrowing corporation√.
(8√ x1mark = 8 marks)

(Total: 20 marks)

QUESTION 2
QAMA Sdn Bhd is in the process of being converted to a public company called QAMA Bhd.
Previously, as a private company, Miss Rina was the only sole director. Section 196(1)(b) of
the Companies Act 2016 provides that a public company shall have a minimum of two
directors. Miss Rina, therefore. approaches Miss Ayu to be the other director of QAMA Bhd.
However, Miss Rina notes that Miss Ayu was previously the director of two wound up
companies.
Required:
a. Describe the qualifications of a director with respect to the Companies Act 2016.
(6 marks)
SUGGESTED ANSWER:
-a private company shall have a minimum of one director√

-a public shall have a minimum of two directors√
-Must attained the age of majority of 18 years old√
-a director shall be a natural person√
-a director shall ordinary reside in Malaysia√
-a director shall not include an alternate or substitute director√
(6√x1mark=6marks)
b. Explain who may not be a director in accordance with the Companies Act 2016.
(8 marks)
SUGGESTED ANSWER:
-A person who has been adjudicated a bankrupt (has not been discharged from his
bankruptcy) √ (section 198 (1)). It is immaterial whether he was made a bankrupt
within or outside Malaysia√ section 198(2)).
-A person who has been convicted of an offence relating to promotion, formation or

management of a company√ under section 198 (1)(b).
-A person who has been convicted of an offence involving bribery, fraud and
dishonesty √ under section 198 (1) (c).
Under section 198 (1) (d):
-A person who has been convicted of an offence involving duties and responsibility of
a director under section 213√.
- A person who has been convicted of an offence involving responsibility of a

nominee director under section 217√.
- A person who has been convicted of an offence involving improper use of

property, position, etc under section 218√.

-A person who has been convicted of an offence involving transactions with directors,
substantial shareholders or connected persons under section 228√.
- A person who has been convicted of an offence involving liability where proper
accounts are not kept under section 539√.
-A person may also be restrained from being a director by the court√ under section
199 (under section 198 (1)(e)).
- An auditor of a company cannot be an officer of the company√ (section 264). This

includes a director as an officer of the company.
-If the director becomes of unsound mind√ under section 208(1)(e).
-A person who does not hold the minimum of number of shares required for holding
the position of a director√.
(Any 8√x1mark=8marks)
c. Determine the position of Miss Ayu as the next director of the QAMA Bhd.
(6 marks)
SUGGESTED ANSWER:
Since Miss Ayu was the director of two wound up companies, Miss Rina must note
that first, the two companies were wound up due to insolvency within a period of 5
years√. Secondly, Miss Rina must note that there should be a restraining order from
the court for Miss Ayu’s position√. Finally, Miss Rina must note that there should be a
court order to make Miss Ayu fit to hold a position as a director after the period of 5
years√.
(3√x2marks=6marks)
(Total: 20 marks)
QUESTION 3
Shareholders of Merdeka Ria Bhd (MRB) and their respective shareholding are as follows:-
Dato’ Basir 25%

Dato’ Tan Kaw Kaw 12%
KMN Bhd 30%
Datin Lee Choo Leng 33%
The Board of Directors of MRB comprises of Dato’ Tan Kaw Kaw, Datin Lee Choo Leng,
Dato’ Basir and Dato’ Shahrir who is the corporate representative of KMN Bhd.
a. The board of MRB insists to know who has the power to convene an Extraordinary
General Meeting (EGM) for the company. Advise the board.
(4 marks)
SUGGESTED ANSWER:
Power to convene an EGM:

-Board of Directors√
-Requisitioned by shareholders holding at least 10%√
-For a company’s without share capital at least 5% of its member√ or total
voting rights√
(4√x1mark=4marks)
b. Dato’ Shahrir seeks your advice as to how KMN Bhd can exercise its rights to request an
EGM for the purposes of removing Dato’ Tan Kaw Kaw as a director of MRB.
(6 marks)
SUGGESTED ANSWER:
Dato’ Shahrir on behalf of KMN has a right to requisition for an EGM to remove Dato’
Tan Kaw Kaw under section 206 CA 2016√ as KMN holds more than 10% of the
voting rights in MRB. √√ Dato’ Shahrir shall have to lodge at the registered office the
special notice√ to remove Dato’ Tan Kaw Kaw . The EGM shall be held not less than
28 days from the date of his lodgement.√ He must lodge as a corporate
representative of KMN. √
(6√x1mark=6marks)
c. State the methods of giving notice to the members, if KMN Bhd could convene the EGM
to remove Dato’ Tan Kaw Kaw.
(5 marks)
SUGGESTED ANSWER:
Method of notices can be

i. Verbal by telephone, √
ii. Press advertisement, √
iii. Bill posting√
iv. broadcasting√
v. Electronic form√
vi. Website√
(Any 5√x1mark=5marks)
d. At the EGM held to remove Dato’ Tan Kaw Kaw, Dato’ Tan Kaw Kaw demands that the
motion of removing him is by a poll basis. Advise (with reasons) the Chairman in the
meeting, whether he/she should allow the demand from Dato’ Tan Kaw Kaw.
(5 marks)

SUGGESTED ANSWER:
Any member or members present in person or by proxy and representing not less
than one tenth of the total voting rights of all the members having the right to vote at
the meeting have a right to demand a poll. √√
Dato’ Tan Kaw Kaw has a right to demand a poll, although the motion is to remove
him. √
This is his rights as a shareholder. √ Otherwise, the Chairman can demand a poll. √
(5√x1mark=5marks)
(Total: 20 marks)
END OF SOLUTION

CONFIDENTIAL 1 AC/JUN 2019/CRG660
SUGGESTED ANSWERS
PART A
1. State FOUR (4) characteristics of a private company, in accordance with the

Companies Act 2016.
(4 marks)
The characteristics according to Companies Act 2016 are:

• It must have a share capital, i.e. a company limited by shares√
• Restrict the rights to transfer its shares√
• Limit the number of members to not more than 50√
• Prohibits any invitation to the public to subscribe for any shares in or debentures of
the company√
• Prohibits any invitation to the public to deposit money with the company for fixed
periods or payable at call, whether interest-bearing or interest-free. √
(Any 4√ x1 mark = 4 marks)
2. Define the meaning of limited liability and unlimited capacity in relation to a company
limited by shares.
(4 marks)
Limited liability – the shareholders of the company are legally responsible for the
debts of a company only to the extent of the nominal value of their shares. √√
Unlimited capacity - The company can carry on any lawful business or activity
together with full rights, powers and privileges unless the constitution provides
otherwise. √√
3. Outline FOUR (4) particulars to be provided in the MyCoID 2016 portal as required by
section 14 (3) of the Companies Act 2016, with regard to the application for registration
of a company.
(4 marks)
The information needed in the MyCoID 2016 portal:
The name of the proposed company√

The status of the company, whether it is private or public√
The nature of business of the proposed company√
The proposed address of the registered office of the proposed company√
The details of the members, directors and secretary of the proposed company√
The details of the class and number of shares to be taken by members (for a company
limited by shares) √
The amount the member undertakes to contribute, in the event the company is wound
up (for a company limited by guarantee) √
(Any4√ x 1 mark = 4 marks)
4. State the circumstances where a person may be disqualified to act as a company

secretary.
(4 marks)
A person shall be disqualified to act as a company secretary if:

i. He is an undischarged bankrupt√
ii. He is convicted, whether within or without Malaysia of any offense mention. √
iii. He has ceased to be a member of the body prescribed by the Minister. √
iv. He ceases to be a holder of a valid license. √
v. He ceases to be a holder of a valid practicing certificate √
5. List FOUR (4) of the statutory books required to be maintained by a company in

pursuant to the requirements of the Companies Act 2016.
(4 marks)
a) The Register of Members√

b) The Register of Directors, Managers and Secretaries√
c) The Register of Debenture Holders√
d) The Register of Substantial Holders – for public companies only√
e) The Register of Directors’ Shareholdings, Debentures and Interests√
f) The Register of Charges√
g) Index of Members for companies with more than 50 members
h) Register of Options to take up Unissued Shares
i) Books of Accounts
j) Records of Resolutions
k) Records of Meetings
6. Briefly explain FOUR (4) features of a non-executive director

(4 marks))
The features of non-executive director are:

• Do not receive salaries and benefits because they do not hold any management
posts√
• Receive director fees which is determined by the member/shareholder at general
meeting √
• Their sole function is to determine/agreed the overall policy of the company,
contribute to discussion and decision making. √
• Carries independent function in BOD√
• MB listing requirements: one-third (or nearest to 1/3) of directors sit on BOD are
independent directors. √
(Any 4√ x1 mark = 4 marks)

7. Give FOUR (4) rights conferred to the holders of ordinary shares in a company as
stated in the Companies Act 2016.
(4 marks)
The FOUR (4) rights conferred are:

• Attending and voting at the company’s annual general meetings (AGMs), general
meetings and meetings of members (MOMs). √
• Election and removal of auditors√
• Receiving and adopting annual audited financial statements and reports. √
• Rights to information about the company√
• Rights to receive notices of meetings√
• Appointment and removal of auditors√
8. Describe the FOUR (4) ordinary businesses transacted during an Annual General
Meeting (AGM).
(4 marks)
The FOUR (4) ordinary business transacted during an AGM are:

• To table the audited Accounts, balance sheet and auditors report√
• The appointment and the fixing of the fee of directors √
• The election of directors in place of those retiring √
• Any other resolutions / Appointment and fixing of the remunerations of Auditors√
(4√ x1 mark = 4 marks)
9. Briefly explain about a company's Constitution in place of Memorandum and Articles of

Association.
(4 marks)
In place of M&A a company may choose to have a single document to be referred to

as a company’s constitution. √ It is a single document that contains the basic
information about the company√ and other matters regarding the company’s internal
management. √ It is also optional for companies limited by shares to have a
constitution. √
(4√ x 1mark = 4 marks)
10. State FOUR (4) circumstances in which a company may be wound up by the Court.
(4 marks)
The Court may order the winding up if:

i. the company by special resolution resolved that the company be wound up by
the Court √
ii. the company does not commence business within a year from its
incorporation or suspends its business for a whole year √
iii. the company has no members √
iv. the company is unable to pay its debts √

v. the directors have acted in the affairs of the company in the directors’ own
interests rather than in the interests of the members as a whole or acted in
any other manner which appears to be unfair or unjust to members√
vi. when the period, if any, fixed for the duration of the company by the
constitution expires or the event, if any, occurs on the occurrence of which the
constitution provide that the company is to be dissolved√
vii. the company is being used for unlawful purposes or any purpose prejudicial
to or incompatible with peace, welfare, security, public interest, public order,
good order or morality in Malaysia√
viii. the Court is of the opinion that it is just and equitable that the company be
wound up√
ix. the company has held a licence under the Financial Services Act 2013 or the
Islamic Financial Services Act 2013, and that the licence has been revoked or
surrendered√
x. the company has carried on a licensed business without being duly licensed
or the company has accepted, received or taken deposits in Malaysia, in
contravention of the Financial Services Act 2013 or the Islamic Financial
Services Act 2013, as the case may be√
xi. the company defaults in lodging the statutory declaration under subsection
190(3) √
xii. the Minister has made a declaration under section 590. √
(Total: 40 marks)

PART B
QUESTION 1
Nina started a small business of supplying stationeries for schools around Kangar about five
years ago. She then decided to convert her small business to a company named QQ
Stationery Sdn Bhd. Being the only director of the company, Nina invited his friend Ayu to
join her company and appointed Ayu as an executive director of QQ Stationery Sdn Bhd.
Both of them then decided to hire Mia, a young graduate to act as the company secretary for
QQ Stationery Sdn Bhd in order to aid them with administrative matters.
After several months of operating, QQ Stationery Sdn Bhd successfully secured a contract
with the Ministry of Education to supply stationeries to all government schools in Perlis. Their
business started flourishing as the sales volume accelerated tremendously. Nina and Ayu
started to realize that they need extra hands to help them in managing the company
effectively. They discussed this issue with Mia and she advised them to appoint another
person to act as a managing director. The managing director will be responsible in handling
the management of the company. As a result, Nina and Ayu would have more time to think
about the best strategic actions to conquer the market.
Required:
a. Discuss the procedure in appointing Mia as the company secretary of QQ Stationery

Sdn Bhd with reference to the Companies Act 2016.
(6 marks)
SUGGESTED ANSWER:
According to s236(3) of the Companies Act 2016, a company should appoint a person as its
company secretary only if he is qualified√
The qualified company secretary should fulfill the criteria as a company secretary under
s235 and s241 of the Companies Act 2016, for example:
A natural person
18 years of age and above
A citizen or permanent resident of Malaysia
A member of prescribed professional bodies in the Fourth Schedule of the
Companies Act 2016
A person who registers and obtains a practicing certificate from the Registrar of
Companies (s241)
(Any 2√)
For the first company secretary, the name of the company secretary should be given in the
application for incorporation of the company (s18(5))√
However, s236 (2) requires the Board of Directors to appoint the first company secretary
within 30 days from the incorporation of the company√

For the subsequent company secretary, the appointment is made by the Board of Directors.
The board should determine the terms and conditions of the appointment√
b. Explain the administrative matters that Mia should handle as prescribed in the
Companies Act 2016.
(6 marks)
SUGGESTED ANSWER:
The administrative matters as prescribed in the Companies Act 2016:
Maintenance of registered office

As a full time employee, the company secretary should be present at the company’s
registered office at the company’s place of business√
As a secretarial firm or company, the company secretary may use the secretarial
firm’s place of business as its registered office√
According to s46(2) of the Companies Act 2016, the company secretary or his agent
should be present at the registered office during ordinary business hours√
Under s48 of the Act, the company secretary should provide assistance especially for
inspection purposes by the ROC on documents and records kept at the registered
office√
(Any 3√)
Maintenance of register of members

Based on s102(1) of the Companies Act 2016, among the company secretary’s
duties is to ensure the register of members is properly kept and maintain regularly√
Lodgement of documents
Generally, the company secretary is the person to lodge company’s documents such
as the particulars of directors, manger and secretaries and thereto (s58 of the Act)
and the company annual returns (s68 of the Act) √
Meetings
At the instruction of the Board of Directors, the company secretary should issue the
notice of the company’s meetings as well as attend the meeting as recorder of the
minutes (by implication under s221(8)) √
(6√x 1 mark = 6 marks)
c. Assuming Nina and Ayu agreed with the suggestion to appoint a managing director,
prepare a notice of a board of directors meeting to include such agenda.
(8 marks)

SUGGESTED ANSWER:
QQ Stationery Sdn Bhd√

(Incorporated in Malaysia)√
(Company no: 12345X)√
NOTICE OF BOARD OF DIRECTORS’ MEETING√
NOTICE IS HEREBY GIVEN THAT the Board of Directors’ Meeting of the company√ will be
held on Tuesday√, 2 January 2019√ at 10.00 am√ at Conference Room 1, Putra Palace
Hotel, Kangar, Perlis√ for the purpose of transacting the following business:
1. To appoint a Managing Director√√
2. To transact any other business√√
By order of the Board√

Mia√
Company Secretary
Date: 26 December 2018√
(note: the day, date, venue and place of the meeting based on students’ own creation)
(16√x ½ mark = 8 marks)

(Total 20 marks)
QUESTION 2
KreamCheezy Bhd (the company) is a public company listed on the ACE market of Bursa
Malaysia. Its company secretary is Ms Lim Bee Ling, a partner of Ling and Azmah
Consultancy. The company is planning on creating a fund (scheme) for the purpose of
providing financial assistance, through giving out loans, to its employees and eligible
directors. Ling and Azmah Consultancy has been asked to hold a half-day briefing to the
directors of the company regarding the legal and secretarial issues related to the creation of
the fund (scheme).
You have just recently been employed by Ling and Azmah Consultancy and have been
asked by Ms Lim to handle the half-day briefing on behalf Ling and Azmah Consultancy.
Required
Answer all the following issues and support your answers with reasons:
a. During the Question and Answer session, some directors asked the following
questions:
i. Tuan Razali Tuan Razi, the managing director asked if he would be eligible to
borrow from the company to finance the renovation of his house when the
scheme has been duly approved and implemented.
(3 marks)

SUGGESTED ANSWER:
Yes√, an executive director is a full-time employee of the company. √ He is allowed

to borrow from a scheme approved by members in general meeting. √This is in
accordance with section 224 (2)(d) of the Companies Act 2016.
ii. Encik Supardi Osman, an executive director has been borrowing from the
company in the past to cover his expenses made for the company’s business
purposes. He explained that all this while he has to make a list of the
expenditure to be approved via a resolution in the Annual General Meeting.
He inquired whether he still will need to do the same in the future if he
borrows from the fund.
(3 marks)
SUGGESTED ANSWER:
No√, borrowing under an approved scheme requires no prior members’ approval√ for
an executive director’s expenses to meet the expenditure incurred or to be incurred
for the purpose of the company.√ This can be referred to section 224(2)(b) of the
Companies Act 2016.
iii. Encik Chua Lee Da, a non-executive director asked if he would be eligible to
borrow from the scheme to finance the purchase of shares in a subsidiary of
KreamCheezy Bhd for his own investment purposes.
(3 marks)
SUGGESTED ANSWER:
No√, a non-executive director is not a full-time employee of the company. √

They are not allowed to borrow under the scheme. √
b. During the tea break, Dato’ Sagoff, a member of the Board of directors of
KreamCheezy Bhd, asked if he would be eligible for reappointment in the next
Annual General Meeting which will be held next month. He was 70 years of age at
that time and was told by his friend that he will no longer be eligible to be a director of
a public listed company.
He is also curious about the position of his alternate director, Stephen Young, if he is
no longer eligible to be a director of the company at the next annual general meeting.
(6 marks)
SUGGESTED ANSWER:
Is Dato’ Sagoff eligible for reappointment?:

Yes. He can be reappointed √. Age limit for public companies no longer applies in
CA2016. √ √ √

Position of alternate director, Stephen Young:

His appointment ends with with the retirement of Dato’ Sagoff. √ √
c. Explain who is a family member for the purpose of “a person connected to a director”
under section 197 of Companies Act 2016.
(5 marks)
SUGGESTED ANSWER:
Under section 197 of the Companies Act 2016, “a person connected to a director”:
• His spouse√
• His child (natural/adopted/step) √
• His parent√
• His brother or sister√
• The spouse of his child, brother or sister√
(5√ x 1 mark = 5marks)
(Total 20 marks)
QUESTION 3
OMMA Sdn. Bhd. (OSB) is a private company. The chairman of the company is seeking your
view on the following matters:
a) One of the shareholders, Puan Ziha would like to give her shares worth RM25, 000 to
her son Encik Ahmad. However, she is confused between the transfer and
transmission of shares. Explain with examples, the differences between transfer and
transmission of shares.
(6 marks)
SUGGESTED ANSWER:
Transfer
• Ownership of the share changes by voluntary act √
• The action involves only, the transferor, transferee and the company √
• Example: Owner sells his share to the new owner, giving away as a gift √
Transmission
• Ownership of the share changes by operation of law √
• The transmission might also involve other parties such as administrator, receiver,
and even a court order may also be required. √
• Example: transmission of shares due to death, bankruptcy or lunacy √
(6 √ x 1 mark each = 6 marks)
b) A prospective investor, Encik Nadzri has written to the company to inform his interest
in purchasing 20,000 shares of the company. In exchange for the shares, Encik
Nadzri will provide the company two vans valued at RM60, 000. Describe the
procedure for Encik Nadzri’s application of new shares.
(8 marks)
SUGGESTED ANSWER:
• The company will request Encik Nadzri to complete an application form for
submitting together with application monies. √
• A board meeting shall be convened the directors to approve the application.√
• Where no such power of the allotment of shares given to the directors, Meeting of
Members (MOM) shall be convened√ either to give the power of allotment to the
board√ or to allot the shares and authorizing the board to issues shares, share
certificate and common seal.√
• The meeting shall authorized director to issue share certificate (if requested by
Encik Nadzri).√
• The company will ask its company secretary to update the Register of Members.
√
• The company secretary will lodge with ROC the return of allotment of shares
within 14 days from the allotment. √
c) Based on the latest OSB board of directors’ meeting, all directors have agreed
unanimously to distribute a 10% final dividend to the shareholders. Advise the board
on the distribution of the dividends in accordance with the requirements of the
Companies Act 2016.
(6 marks)
SUGGESTED ANSWER:
• Distribution out of profit

o A company may only make a distribution to the shareholders out of profit of
the company available if the company is solvent. √√
• Distribution only if company is solvent

o Before a company makes a distribution, the directors of the company shall
authorize the distribution. √
o The directors may authorize a distribution at the time and amount as the
directors feel appropriate. √
o The company remains as solvent within 12 months after the distribution
made. √
o However, if the distribution is authorized and the directors think the company
may not be solvent, then the directors shall take necessary actions to prevent
the distribution. √
(6√ x 1 mark each = 6 marks)
(Total: 20 marks)
END OF QUESTION PAPER

QUESTIONS
CRG660 – TEST
DATE: 2 JANUARY 2020
PART B
GROUP:
STUDENT ID:
FULL NAME:
LECTURER’S NAME:
PLEASE READ, UNDERSTAND AND CHECK ALL BOXES:
I declare that I have observed and will adhere to the Faculty Online Assessment
Regulations or any of the Chief Invigilator/ Invigilators’ instructions. If found otherwise,
I can be barred from taking the assessment or can be brought to the Student
Disciplinary Action Board.
I do understand that I can be penalised under Rules 48, Act 174 of the Educational
Institutions (Discipline) Act 1976, and can be punished with a maximum penalty from
the University if I am found guilty of a disciplinary offence.
READ THE INSTRUCTIONS BELOW:

1) ANSWER ALL QUESTIONS:
PART A (30 QUESTIONS)
PART B (2 QUESTIONS)
2) PLEASE WRITE THE ANSWER
3) READ THE QUESTIONS CAREFULLY
4) SUBMIT THE QUESTIONS AS INSTRUCTED BY YOUR LECTURER
QUESTION 1
Ulung Bistari Bhd has been active in manufacturing personal health care products and health-
related equipment over the last 10 years. The company has undergone several changes with
the outbreak of Corona Virus 19 (CV-19) to meet a very high demand for products and highly
unique drug specifications.As a result, a specialist, Dr. Siruv Anorococ (Dr. Siruv), has been
appointed as part of the new Board of Directors. Dr. Siruv, being a doctor all his life, is a
stranger to the management of a company and really needs a company secretary's guidance
in his daily decision-making processes when it comes to legal and regulatory matters.
Required:
a) Dr. Siruv asked you about the Director's Training Program, as required by the
Corporate Governance Code of Malaysia. Explain this to him.
(5 marks)
b) Dr Siruv impressed with your knowledge on corporate governance had asked whether
you can join the corporation as one of the directors. Explain to him on this matter with
an example.
(5 marks)
c) Dr. Siruv is confused about the features of alternate and associate directors. Briefly
explain the features of these two portfolios to him.
(5 marks)
d) Dr. Siruv is interested to understand the challenges you face as the company secretary
during this pandemic, while struggling to comply with the pertinent requirements of the
Companies Act 2016. Share the challenges that you have faced during this pandemic
with him.
(5 marks)
(Total: 20 marks)
QUESTION 2
As the Coronavirus disease (COVID-19) pandemic has continued to impact every aspect of
the businesses and lives, Digitaland Bhd have had to change the way shareholder meetings
have been held. The feedback from most of shareholders indicates that company opted for
meetings that were fully virtual in nature by allowing shareholders to dial into calls or video
conferencing platforms from anywhere.
The board of directors of Digitaland Bhd instructed you as a company secretary to hold for an
Extraordinary General Meeting (EGM) virtually. The purpose of the meeting is to pass the
following special business:
i) To amend the company's constitution by adding “To construct, maintain, alter

and improve or subscribe to the construction, maintenance and improvement of
any buildings, factories, roads, ways, water works, canals tramways, railways,
quays, wharves and works of all kinds relating to any business of
the Company necessary or convenient for the purpose of the Company” in the
object clause.
ii) To change its name from Digitaland Bhd to DTL and Bhd.
The board has instructed you as a company secretary to carry out your duties and related
matters for the shareholders’ meeting.
a) In your own words, provide reasons why a company needs to convene an

Extraordinary General Meeting (EGM)
(2 marks)
b) Explain briefly the persons who have the authority to convene an Extraordinary General
Meeting for Digitaland Bhd.
(4 marks)
c) Prepare the notice of the Extraordinary General Meeting (EGM) of the company by
including all the relevant agenda to be considered at that meeting.
(9 marks)
d) A proxy is a person appointed by a member on his or her behalf to attend, speak and
vote at a general meeting. Provide situations in which the appointment of a proxy
becomes invalid.
(5 marks)
(Total: 20 marks)
(TOTAL: 40 marks)

CRG660 - Full SS 2022 To 2019

Uploaded by

Copyright:

Available Formats

CRG660 - Full SS 2022 To 2019

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

CRG660 - Full SS 2022 To 2019

Uploaded by

Copyright:

Available Formats

FINAL ASSESSMENT

CRG660 – COMPANY SECRETARIAL PRACTICE

Resignation of a company secretary:

b. Assuming Najah does not vacate the office of company secretary of

Exclusion of liability of a company secretary:

• The company secretary is a corporate officer √. As such, he cannot be exempt from,

• A fixed charge is a charge created on a fixed asset of the company. √

Appointment of new directors in public companies must be made in a general

b) The terms of appointment as a Managing Director of the company

The appointment of a managing director is usually provided in the constitution√ and

1) The company is not carrying on business or is not in operation√

PART A – 40 QUESTIONS (40 MARKS)

● Written resolution is not allowed for Syntex Bhd. ( ) In accordance to Section

Winding up a business is not the same as bankruptcy, though it is usually a result of

b. Briefly describe the commencement of a compulsory winding up.

a. List six (6) persons:

c. If the company itself is the petitioner, briefly explain the procedure:

d. Explain three (3) circumstances:

● Ownership of the share changes by voluntary act √

● Ownership of the share changes by operation of law √

b. The statement containing Particulars of a Series of Debentures must be registered with

Briefly explain the particulars of the statement.

b. The FOUR (4) particulars are:

UNIVERSITI TEKNOLOGI MARA

COURSE : COMPANY SECRETARIAL PRACTICE

COURSE CODE : CRG530/660

DATE : 16 FEBRUARY 2021

TIME : 9.00 – 12.00 NOON (3 HOURS)

SUBMISSION TIME : 12.00 NOON – 12.30 PM (30 MINUTES)

i) the Question Paper

4. Answer ALL questions in English.

DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO

© Hak Cipta Universiti Teknologi MARA CONFIDENTIAL

Dato’ Tazzudin Ramzey, a professional engineer and Datuk Kushairie Ahmad, a

a) Briefly explain three (3) criteria of a non-executive director

b) Discuss the items to be included in the declaration a person before he can be

i. He is not an undischarged bankrupt

c) Discuss the effect of disqualification of a person as director of a company.

i A director is guilty of an offence if he still holds office as a director

iv If there is only one director in the company, and he is disqualified,

v Upon disqualification of a director, a casual vacancy is created and the

(Any 6 x 1 mark = 6 marks)

i) No right to attend or vote at meetings and any purported exercise of such

1. Meeting must be properly convened

A notice of the meeting should be issued to every member, director and

2. Meeting must be properly constituted.

Quorum is the minimum number of persons who must be present at the

The constitution usually provided for the appointment of a chairman.

1. In the case for companies having a share capital

a. Is it possible for MSB to apply for deregistration? Explain.

i. What can JBB do to recover its loan?

ii. Explain the process of compulsory winding up.

iii. Explain the effects of a liquidator’s (3 marks)

• the directors' powers will

• any transfer of shares or any alteration in the status of members will be

iv. Explain the functions of a committee of inspection in the dissolution process

i. To advise and assist the liquidator of the company;

c) If the investigation of the liquidator of a company undergoing member’s voluntary

The liquidator will need to arrange for a creditor’s voluntary liquidation