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ICSB CS Executive practice questions

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Question 1Company Law

Under the Companies Act, 2013, what is the minimum number of members required to form a public company?

  1. Two
  2. Three
  3. Seven Correct answer.
  4. Fifty

Explanation

Section 3 of the Companies Act, 2013 provides that a public company may be formed by seven or more persons, while a private company requires only two. A one person company requires a single individual. The number fifty relates to the maximum members of a private company, not the minimum for a public company.

Question 2Company Law

A private company wishes to alter its articles. Which document must it file with the Registrar to give effect to the alteration?

  1. An ordinary resolution passed at a general meeting
  2. An application to the Central Government for prior approval
  3. A board resolution certified by the auditor
  4. A certified copy of the special resolution together with the altered articles Correct answer.

Explanation

Section 14 requires a company altering its articles to file a certified true copy of the special resolution along with the altered articles with the Registrar within fifteen days. Alteration of articles generally requires a special resolution, not an ordinary one. Prior Central Government approval is needed only in specific cases such as conversion of a public company into a private company.

Question 3Company Law

Which of the following is a statutory right available to every member of a company limited by shares?

  1. Right to inspect the register of members Correct answer.
  2. Right to veto board decisions
  3. Right to be appointed as managing director
  4. Right to receive a fixed dividend each year

Explanation

Section 88 read with the rules requires companies to maintain registers, and members have a statutory right to inspect the register of members and other statutory registers on payment of prescribed fees. Appointment as managing director, fixed dividends, and veto powers are not statutory member rights and depend on the articles or board decisions.

Question 4Company Law

What is the maximum number of members permitted in a private company under the Companies Act, 2013?

  1. Fifty
  2. There is no ceiling
  3. One hundred
  4. Two hundred Correct answer.

Explanation

Section 2(68) defines a private company as one whose articles restrict the transfer of shares and limit the number of members to two hundred, excluding present and past employee-members. Joint holders are counted as a single member for this purpose. The limit of fifty applied under the earlier Companies Act, 1956 and no longer governs.

Question 5Company Law

Which type of resolution is required for a company to borrow money in excess of its paid-up share capital and free reserves, where the articles do not permit otherwise?

  1. Special resolution Correct answer.
  2. Board resolution only
  3. Ordinary resolution
  4. Resolution of the creditors

Explanation

Section 180 restricts the board from borrowing beyond the aggregate of paid-up share capital and free reserves unless the members approve by special resolution. The same section requires a special resolution for certain other powers such as selling undertakings. An ordinary resolution or a mere board resolution cannot confer this authority.

Question 6Company Law

Within how many days of incorporation must a company hold its first board meeting?

  1. Ninety days
  2. Fifteen days
  3. Sixty days
  4. Thirty days Correct answer.

Explanation

Section 173 requires the first board meeting to be held within thirty days of the date of incorporation. Thereafter, a minimum of four board meetings must be held every year with a gap of not more than one hundred and twenty days between consecutive meetings. The shorter periods listed do not reflect the statutory timeline.

Question 7Company Law

The memorandum of association of a company must contain which of the following clauses?

  1. Employee welfare clause
  2. Audit clause
  3. Dividend clause
  4. Objects clause Correct answer.

Explanation

Section 4 requires the memorandum to state the name clause, registered office clause, objects clause, liability clause, capital clause and, where applicable, the subscription clause. Dividend, audit and employee welfare matters are dealt with in the articles or general law. They are not mandatory memorandum clauses.

Question 8Company Law

Which document governs the internal management of a company and is subordinate to the memorandum?

  1. Prospectus
  2. Annual return
  3. Share certificate
  4. Articles of association Correct answer.

Explanation

The articles of association contain the regulations for internal management and are subordinate to the memorandum. Where the two conflict, the memorandum prevails. A prospectus invites subscriptions, an annual return records statutory particulars, and a share certificate evidences title, so none of these governs internal management.

Question 9Company Law

A company's board wishes to appoint an additional director between two annual general meetings. Which course is legally correct?

  1. Only the members in general meeting may create a new directorship
  2. The board may appoint an additional director for a fixed term of five years
  3. The managing director may appoint an additional director unilaterally
  4. The board may appoint an additional director, whose term lasts until the next annual general meeting Correct answer.

Explanation

Section 161 permits the board to appoint additional directors at any time, provided the total does not exceed the authorised strength. Such a director holds office only up to the date of the next annual general meeting. Members in general meeting may then regularise the appointment.

Question 10Company Law

A director of a company fails to disclose his interest in a contract at a board meeting. What is the consequence under the Companies Act, 2013?

  1. The contract automatically becomes void and unenforceable by either party
  2. The contract may be voidable at the option of the company and the director may be liable to account Correct answer.
  3. The Registrar cancels the company's certificate of incorporation
  4. The director is automatically disqualified for ten years

Explanation

Section 184 requires a director with an interest in a contract to disclose it at the board meeting. Where disclosure is not made, the contract becomes voidable at the option of the company and the interested director may be required to account for any gain. The other consequences described are not the statutory result of non-disclosure.

Question 11Company Law

Which of the following persons is disqualified from being appointed as a director of a company under Section 164?

  1. A chartered accountant in practice
  2. An undischarged insolvent Correct answer.
  3. A non-resident foreign national
  4. A person aged forty years

Explanation

Section 164 disqualifies a person who is of unsound mind, an undischarged insolvent, has been convicted of certain offences, or has failed to pay prescribed penalties. Age above forty, professional practice, and foreign residence do not by themselves disqualify a person. A person must attain the minimum age of eighteen to be eligible.

Question 12Company Law

A company wants to issue sweat equity shares to its employees. Which approval is required?

  1. Approval of the stock exchange alone
  2. Ordinary resolution of members only
  3. Board resolution without any member approval
  4. Special resolution of members and compliance with prescribed conditions Correct answer.

Explanation

Section 54 permits a company to issue sweat equity shares after passing a special resolution and subject to conditions such as the class of shares, number, price and consideration. The issue must also comply with the prescribed rules. A mere board resolution or ordinary resolution does not satisfy the statutory requirement.

Question 13Company Law

What is the minimum amount of contribution required to be made by a member of a One Person Company?

  1. Ten lakh rupees
  2. No minimum contribution is prescribed; any amount may be contributed Correct answer.
  3. Five lakh rupees
  4. One lakh rupees

Explanation

The Companies Act, 2013 does not prescribe any minimum capital contribution for a One Person Company or any other company. Capital is determined by the memorandum and the shares subscribed. The figures mentioned have no statutory basis as minimum contribution requirements.

Question 14Company Law

A shareholder of a listed company wants to inspect the minutes of board meetings. Which statement is correct?

  1. Members may inspect board minutes freely at any time
  2. Members are not entitled to inspect board minutes, though they may inspect minutes of general meetings Correct answer.
  3. Only directors may inspect minutes of general meetings
  4. Board minutes must be published on the company's website

Explanation

Section 118 allows members to inspect the minutes of general meetings but does not extend that right to minutes of board meetings. Board minutes are confidential and accessible only as the Act permits. Publication of board minutes on a website is not a statutory requirement.

Question 15Company Law

Which of the following constitutes a valid quorum for a general meeting of a public company with 5,000 members?

  1. Thirty members present in person or by proxy Correct answer.
  2. Two members present in person
  3. One hundred members present in person
  4. Five members present in person

Explanation

Section 103 prescribes the quorum for general meetings: five members for a company with up to one thousand members, fifteen for up to five thousand, and thirty for more than five thousand. For a company with five thousand members, the requirement is fifteen, and thirty satisfies it. The other options either fall short or are not the prescribed figure.

Question 16Company Law

A company declares a dividend out of profits. Which statutory requirement must be satisfied before such declaration?

  1. Obtaining the consent of every creditor
  2. Providing for depreciation in accordance with the Act Correct answer.
  3. Publishing the dividend in the Official Gazette
  4. Approval of the Registrar of Companies

Explanation

Section 123 permits dividend declaration only out of profits after providing for depreciation in accordance with Schedule II. It also allows declaration out of accumulated profits and, in limited cases, out of free reserves subject to rules. Consent of creditors, Registrar approval, and Gazette publication are not prerequisites.

Question 17Company Law

Which body is empowered to appoint the first auditor of a company, other than a government company?

  1. The members at the first annual general meeting
  2. The Comptroller and Auditor General
  3. The board of directors within thirty days of incorporation Correct answer.
  4. The audit committee of the company

Explanation

Section 139 provides that the first auditor of a company, other than a government company, is appointed by the board within thirty days of incorporation. If the board fails to do so, the members appoint the auditor at an extraordinary general meeting within ninety days. The Comptroller and Auditor General appoints auditors only for government companies.

Question 18Company Law

A director of a company secretly makes a personal profit by using a business opportunity that rightfully belongs to the company. What is the director's liability?

  1. The director is liable only to pay a nominal penalty to the Registrar
  2. The director is absolved if the board later ratifies the act by simple majority
  3. The director may retain the profit if no loss was caused to the company
  4. The director must account to the company for the profit made Correct answer.

Explanation

Directors owe a fiduciary duty not to divert corporate opportunities for personal gain. Where a director exploits such an opportunity, the company may require the director to account for the profit, irrespective of whether the company suffered a measurable loss. Ratification of a breach of fiduciary duty is not available by simple majority where it amounts to oppression or fraud on the minority.

Question 19Company Law

Under the Companies Act, 2013, which of the following is a class of company recognised on the basis of control?

  1. Dormant company
  2. Foreign company
  3. Holding company Correct answer.
  4. Section 8 company

Explanation

A holding company is defined by reference to control over the composition of the board or more than half of the total voting power of another company. Section 8 companies are classified by their charitable objects, foreign companies by incorporation outside India, and dormant companies by inactivity. Control is therefore the defining criterion only for holding and subsidiary companies.

Question 20Company Law

What is the maximum period for which an independent director may hold office on the board of a company, on a continuous basis?

  1. One term of five years only
  2. Two consecutive terms of five years each Correct answer.
  3. Ten consecutive years without any break
  4. Three consecutive terms of five years each

Explanation

Section 149 provides that an independent director may hold office for up to two consecutive terms of five years each, subject to approval by special resolution. A cooling-off period of three years is required before reappointment. A single term or three terms would not reflect the statutory maximum.

Question 21Company Law

A company proposes to give a loan to a director. Under which provision is such a loan regulated?

  1. Section 188, which deals with related party transactions
  2. Section 185, which generally prohibits loans to directors subject to specified exceptions Correct answer.
  3. Section 179, which deals with board powers
  4. Section 186, which permits loans freely to any person

Explanation

Section 185 prohibits a company from advancing loans to its directors or to persons in whom directors are interested, subject to limited exceptions such as loans approved by special resolution for a director's business. Section 186 regulates loans and investments generally, while Section 188 governs related party transactions. Section 179 deals with board powers requiring member approval.

Question 22Company Law

A company's articles contain a clause that conflicts with a mandatory provision of the Companies Act. What is the effect of that clause?

  1. The clause is void to the extent of the inconsistency Correct answer.
  2. The clause is valid if approved by three-fourths of the members
  3. The clause is valid if approved by the board
  4. The clause prevails over the Act

Explanation

The articles are subordinate to the Companies Act, and any provision inconsistent with a mandatory statutory requirement is void to the extent of the inconsistency. Member or board approval cannot override a mandatory provision of the Act. The memorandum and the Act prevail over the articles.

Question 23Company Law

A company fails to file its financial statements with the Registrar within the prescribed period. Which consequence applies to the company and its officers?

  1. Additional fees and penalties, with the company and officers in default liable to punishment Correct answer.
  2. Conversion of the company into a limited liability partnership
  3. Automatic dissolution of the company
  4. Cancellation of the directors' DIN by the Registrar

Explanation

Section 137 requires filing of financial statements within thirty days of the annual general meeting, and delay attracts additional fees under Section 403. The company and every officer in default are also punishable with fine. Failure to file does not cause automatic dissolution, DIN cancellation, or conversion into an LLP.

Question 24Company Law

A member holding shares in a company transfers them without executing a valid instrument of transfer. Which statement best describes the legal position?

  1. The transfer is complete when the board records it in the register, even without an instrument
  2. The transfer is complete once the transferee pays consideration
  3. The transfer is complete on mere delivery of the share certificate
  4. The transfer is not complete until a proper instrument of transfer is executed and delivered as required Correct answer.

Explanation

Section 56 requires a transfer of shares to be effected by a duly executed and stamped instrument of transfer in the prescribed form, delivered to the company along with the share certificate. Mere delivery of the certificate or payment of consideration does not perfect title. Registration by the board presupposes a valid instrument.

Question 25Company Law

A company has accumulated losses and wishes to declare a dividend out of free reserves. Which condition must be satisfied under the Companies Act, 2013?

  1. The rate of dividend must not exceed the average of the rates declared in the three immediately preceding years Correct answer.
  2. The company must obtain prior approval of the Securities and Exchange Board of India
  3. The company must first reduce its share capital
  4. The dividend must be paid only in the form of bonus shares

Explanation

The rules framed under Section 123 permit declaration of dividend out of accumulated profits or free reserves in the event of inadequacy of profits, subject to conditions. These include a cap on the rate of dividend at the average of the three preceding years and a limit on the amount drawn from reserves. SEBI approval, bonus-share-only payment, and capital reduction are not statutory conditions.

Question 26Company Law

A private company is formed by two individuals. What is the maximum number of members such a company may have under the Companies Act, 2013?

  1. No limit
  2. Fifty
  3. One hundred
  4. Two hundred Correct answer.

Explanation

A private company is defined by its articles restricting the right to transfer shares and limiting the number of members to two hundred, apart from present and former employees who are members. This ceiling of two hundred members is a defining statutory characteristic of the private company form.

Question 27Company Law

Which of the following is a statutory duty of an auditor of a company?

  1. To prepare the annual financial statements of the company
  2. To make a report to the members on the accounts examined Correct answer.
  3. To approve the annual budget of the company
  4. To declare dividends on behalf of the board

Explanation

The auditor's central statutory function is to examine the accounts and report to the members on whether the financial statements give a true and fair view. Preparation of accounts and declaration of dividends are functions of the management and the board, not of the auditor.

Question 28Company Law

Which of the following is a recognised mode of winding up of a company under the Companies Act, 2013?

  1. Voluntary winding up by resolution of the board alone
  2. Compulsory winding up by the Registrar of Companies
  3. Administrative dissolution by the Central Government
  4. Winding up by the Tribunal Correct answer.

Explanation

The Companies Act, 2013 provides for winding up of a company by the Tribunal, and the old concepts of voluntary and compulsory winding up were replaced by the Insolvency and Bankruptcy Code process. Winding up is a judicial function exercised by the National Company Law Tribunal.

Question 29Company Law

What is the minimum number of directors required for a public company under the Companies Act, 2013?

  1. Three Correct answer.
  2. Five
  3. Seven
  4. Two

Explanation

A public company must have at least three directors, a private company at least two and a One Person Company at least one. These minimums are prescribed in the Act and apply regardless of the size of the company's operations.

Question 30Company Law

A company wishes to alter its object clause to enter a new line of business. Which approval is required for the alteration to take effect?

  1. Approval of the board of directors only
  2. Special resolution of the members and approval of the Registrar Correct answer.
  3. Ordinary resolution of the members only
  4. Consent of the company's bankers

Explanation

Alteration of the object clause requires a special resolution of the members, and the altered memorandum must be filed with the Registrar, who registers the change. Board approval alone or an ordinary resolution is insufficient for this fundamental change.

Question 31Company Law

Which of the following statements about the liability of members of a company limited by guarantee is correct?

  1. Members are liable only to the extent of their unpaid share capital
  2. Members have unlimited liability for all company obligations
  3. Members undertake to contribute a fixed amount only on winding up Correct answer.
  4. Members are liable for the debts of the company as they arise

Explanation

In a company limited by guarantee, each member undertakes to contribute a specified amount to the assets of the company in the event of winding up. This liability arises only on winding up and is capped at the guaranteed amount.

Question 32Company Law

A company wishes to keep its registered office at a place other than that stated in its memorandum. What must it do?

  1. Change its name to reflect the new location
  2. Notify the Registrar within the prescribed time and verify the office Correct answer.
  3. Obtain prior permission of the Central Government
  4. Pass a special resolution and seek court approval

Explanation

A company may shift its registered office within the local limits by notifying the Registrar in the prescribed manner and filing verification of the office. Prior central government approval and court involvement are not needed for a change within the same limits.

Question 33Company Law

Which of the following is the correct description of a proxy in relation to a general meeting?

  1. A director appointed to chair the meeting
  2. A person who may speak and vote at the meeting on behalf of a member Correct answer.
  3. A member who attends and votes on behalf of another member
  4. A person appointed by a member to attend but not to vote

Explanation

A proxy is a person appointed by a member to attend and vote at a general meeting on that member's behalf. Unless the articles provide otherwise, a proxy cannot speak at the meeting, but the proxy can vote.

Question 34Company Law

A company proposes to issue shares to a person other than the existing members. Which of the following is normally required before such an issue?

  1. Approval by the Registrar of Companies
  2. Consent of the company's auditors
  3. An offer to existing members in proportion to their holding Correct answer.
  4. Publication of the offer in the Official Gazette

Explanation

Section 62 requires that where a company increases its subscribed capital by issuing further shares, those shares must first be offered to existing equity shareholders in proportion to their paid-up capital. This pre-emptive right protects members against dilution.

Question 35Company Law

A company wishes to buy back its own shares out of free reserves. Which condition must be satisfied?

  1. The buy-back must be approved by the Registrar
  2. The company must have no secured creditors
  3. The buy-back must be completed within thirty days
  4. The buy-back must not exceed twenty-five per cent of the aggregate paid-up capital and free reserves Correct answer.

Explanation

Section 68 permits buy-back out of free reserves or securities premium, subject to limits such as the cap of twenty-five per cent of the aggregate of paid-up capital and free reserves. The resolution and other conditions must also be met.

Question 36Company Law

A director of a company is also a partner in a firm that supplies goods to the company. What is the director's obligation?

  1. To obtain prior approval of the auditors
  2. To transfer his shares to the company
  3. To disclose the nature of his interest at a board meeting Correct answer.
  4. To resign from the board immediately

Explanation

A director who is directly or indirectly interested in a contract or arrangement with the company must disclose the nature of that interest at a meeting of the board. Non-disclosure can render the contract voidable and expose the director to penalties.

Question 37Company Law

Which of the following is a consequence of a company failing to convene its annual general meeting within the prescribed time?

  1. The company loses its certificate of incorporation
  2. The company is automatically wound up
  3. The directors are automatically disqualified for life
  4. The Tribunal may order the calling of the meeting on application by a member Correct answer.

Explanation

If a company defaults in holding its annual general meeting, the Tribunal may, on the application of any member, direct that the meeting be called and held. The company and its officers may also face penalties for the default.

Question 38Company Law

A company's articles provide that the chairman shall have a casting vote at general meetings. How is this provision treated?

  1. It is void because the Act prohibits casting votes
  2. It requires the approval of the Tribunal to operate
  3. It is valid if the articles so provide and the votes are equal Correct answer.
  4. It is valid only in a private company

Explanation

Where the articles provide for a casting vote, the chairman may exercise it in the event of an equality of votes. In the absence of such a provision, the resolution is not carried because a majority has not approved it.

Question 39Company Law

A company wishes to appoint an alternate director during the absence of a director from India. Which statement is correct?

  1. An alternate director may hold office for the whole term of the original director
  2. An alternate director may be appointed only if authorised by the articles or a board resolution Correct answer.
  3. An alternate director may be appointed for any period, however short
  4. An alternate director must be a member of the company

Explanation

The board may appoint an alternate director to act for a director during his absence for a period of at least three months from India, where the articles authorise it or the board resolves to do so. The alternate holds office only so long as the original director is absent.

Question 40Company Law

A company wishes to remove an auditor before the expiry of his term. Which procedure applies?

  1. The auditor may be removed by the audit committee alone
  2. The auditor may be removed by an ordinary resolution after prior approval of the Central Government Correct answer.
  3. The board may remove the auditor by a simple resolution
  4. The auditor may be removed only by the Tribunal

Explanation

An auditor may be removed before the expiry of his term only by an ordinary resolution of the members, after obtaining the previous approval of the Central Government. This safeguard protects auditor independence.

Question 41Company Law

A company declares a final dividend at its annual general meeting. Within how many days must the dividend be paid or the warrant despatched?

  1. Thirty days Correct answer.
  2. Sixty days
  3. Fifteen days
  4. Forty-five days

Explanation

Once a dividend is declared, the company must pay it or despatch the warrant within thirty days of the declaration. Failure to do so can attract penalties and interest for the period of delay.

Question 42Company Law

A company is unable to pay its debts and a creditor petitions the Tribunal. Which ground may the Tribunal consider for ordering winding up?

  1. The company has not appointed a woman director
  2. The company has failed to pay a statutory demand for a debt exceeding the prescribed amount Correct answer.
  3. The company has failed to hold a board meeting in a quarter
  4. The company has changed its name without approval

Explanation

A company may be wound up if it is unable to pay its debts, which is established where it fails to pay a debt exceeding the prescribed threshold within the statutory period after a demand. Other procedural defaults do not by themselves justify winding up.

Question 43Company Law

A company proposes to enter into a contract with a related party. Which approval is generally required where the transaction exceeds the prescribed thresholds?

  1. Approval of the board only
  2. Approval of the company's bankers
  3. Approval of the Registrar of Companies
  4. Prior approval of the members by resolution Correct answer.

Explanation

Related-party transactions exceeding the prescribed thresholds require prior approval of the members by resolution, in addition to board approval. The audit committee's approval is also relevant for listed companies.

Question 44Company Law

Which of the following statements about the doctrine of indoor management is correct?

  1. It allows a company to escape liability where its officers acted beyond their authority
  2. It protects outsiders who deal with a company against internal irregularities of which they had no notice Correct answer.
  3. It applies only to transactions with the government
  4. It requires outsiders to inspect the company's internal records before contracting

Explanation

The doctrine of indoor management, associated with Royal British Bank v Turquand, protects bona fide outsiders dealing with a company from internal irregularities of which they were unaware. It complements the doctrine of constructive notice of public documents.

Question 45Company Law

A company wishes to reduce its share capital. Which of the following is the correct route?

  1. A board resolution followed by an ordinary resolution
  2. A unanimous resolution of the board only
  3. A special resolution and confirmation by the Tribunal Correct answer.
  4. An ordinary resolution and approval of the Registrar

Explanation

Reduction of share capital requires a special resolution of the members and confirmation by the Tribunal, which considers the interests of creditors and members. The process is subject to the Tribunal's scrutiny to protect those interests.

Question 46Company Law

A member of a company alleges that the affairs of the company are being conducted in a manner oppressive to him. Which remedy is available?

  1. A direct suit against the auditors
  2. A petition to the Registrar to wind up the company
  3. An application to the Central Government to remove the directors
  4. An application to the Tribunal for relief against oppression and mismanagement Correct answer.

Explanation

Section 241 allows a member to apply to the Tribunal for relief where the affairs of the company are conducted in a manner oppressive to members or prejudicial to the public interest. The Tribunal may make orders regulating the company's affairs.

Question 47Company Law

Which of the following best explains why the corporate veil may be lifted by courts?

  1. To permit directors to escape personal liability
  2. To prevent abuse of the corporate form for fraud or improper conduct Correct answer.
  3. To enable the company to avoid payment of taxes
  4. To allow members to avoid contractual obligations

Explanation

The separate legal personality of a company may be disregarded where the corporate form is used as a cloak for fraud, improper conduct or to evade legal obligations. Lifting the veil serves public policy rather than the private convenience of members or directors.

Question 48Company Law

A company allots shares and fails to deliver the share certificates within the prescribed period. What is the consequence?

  1. The allotment becomes void automatically
  2. The company and its officers are liable to penalties for the default Correct answer.
  3. The shares are forfeited to the Registrar
  4. The members lose their voting rights

Explanation

The company must deliver share certificates within the prescribed time after allotment, and default attracts penalties on the company and its officers. The allotment itself remains valid; the default is procedural.

Question 49Company Law

Which of the following is a distinguishing feature of a One Person Company under the Companies Act, 2013?

  1. It cannot have a nominee
  2. It must be a public company
  3. It must be a private company with a single member Correct answer.
  4. It must have at least two directors

Explanation

A One Person Company is a private company with only one person as its member, and the memorandum must nominate a person who will become the member on the original member's death or incapacity. It may have a single director.

Question 50Company Law

A director of a company is convicted of an offence involving fraud. What is the effect on his directorship?

  1. He may continue until the next annual general meeting
  2. He is disqualified from being appointed or continuing as a director for the prescribed period Correct answer.
  3. He may continue if the board passes a resolution
  4. He is disqualified only if the company is listed

Explanation

A conviction for an offence involving fraud disqualifies a person from being appointed or continuing as a director for the period prescribed by the Act. The disqualification operates by law and does not depend on board or member approval.