Book closure

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

02 July 2012 Whether it is necessary for a Ltd company to close books for declaring dividends.... As per my interpretation the company need not require to close its books... Correct me if m wrong ???
Please clarify me as soon as possible.....

Ajay Mishra

Ajay Mishra (Expert)
Follow

02 July 2012 Hi

For Listed Company it is mandatory to close books of the company and intimate the same to the stock exchange.

In case of non-listed company, section 154 of the Companies Act, give power to close register of members once in a year.

As you says, that no need to close books of the company for declaring dividend. Suppose Mr. A is members of company before declaring dividend and one day before the date of declaration he transfer his shares to Mr. X and intimated the same to the company, if you says that no need to close books then hou you decide that who is members of the company at the time of declaraing of dividend.

For removing this doubt, the Board of director fix the date from which any new activity regarding transfer or other will not be accepted for deciding the number of shareholders and list of members who will be entitled to collect the dividend if declared by company.

So for this reason book closure is required.

Regards

Querist : Anonymous

Querist : Anonymous (Querist)

03 July 2012 Thanks for your reply...
BUt please clarify if we decide one record date in board meeting then this problem will be solve.... please confirm me whether m correct ???

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now