Agm agenda - dividend as second item in notice

Kannan

Very very good question. Indeed thought provoking. I shall try to give a feedback after consultation with my seniors.

Regards,

Hello,

Indeed its a very noticable point. The suggestion given is also good to consider. 

But i want to just comment upon the situation that shareholder doesnt have a right to increase the dividend and i think it is practically doesnt happen that their is a reduction in Dividend rate.

Further in Act they have mention that four business in a particular sequence but i dont think that its mandatorily or legally to be followed. The other way can also b accepted. 

Contrary views are wlcomed.

Nidhi

Dear Kannan,

          i would like to add some points on the practical basis. If you are a shareholder of the X ltd co., you would like to receive return for your investment. so once the dividend is declared by the board of directors, then the shareholders just approve because practically the shareholders expect more returns and there is no option to increase the dividend by the shareholders. whether anyone wants to reduce his income when the directors approved to declare the dividend. thus there is no confusion among the agenda.

          You may ask why not the shareholders reduce the dividend for the future development of the company? The directors of the company must analyse the past, present result to predict the future expections and the requirements and also contingencies. Thus the directors fix the rate of dividend for the shareholders as a least one. So that the dividend declared by the directors always accepted by the shareholders.

        If any further doubts or clarifications i always available for you. Thank You

Let me look at the issue this way. Audited accounts contain only a provision made as on the end of the year for payment of dividend, as per the recommendation of the Board of Directors.

If at all the dividend to be paid is less than provision (which is already created in the financial statements approved by the members before considering the resolution of dividend), then the provision will be reduced or adjusted in the subsequent financial years.

In this scenario, I do not envisage any bottlenecks with the sequence of consideration of items in the shareholders meeting.

Regards,

I agree with Dipjyoti ji as auditor has to cumpulsorily made provisions for proposed dividend as directed by AS 5 so if in AGM, dividend is declared less than that what has been provided for then it will be reduced in following year accordingly no effect in current year accounts.so no such matte of sequencing of items in agenda.