CS Executive Officer flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

Separate legal personality

The company is a legal person distinct from its members, so it owns assets, contracts, and bears liability in its own name, while members' liability is generally limited to unpaid share amounts.

Doctrine of indoor management

Outsiders dealing with a company in good faith may assume its internal procedures were properly followed, unless they had actual or constructive notice of an irregularity.

Ultra vires act

An act beyond the objects stated in the company's memorandum. Such an act is void and cannot be ratified even by unanimous shareholder consent, though directors may be liable.

Oppression and mismanagement

Statutory remedy where company affairs are conducted oppressively toward members or prejudicially to public interest; the tribunal may regulate conduct, remove directors, or order a share buy-out.

Independent director tenure

An independent director may serve two consecutive terms of up to five years each; reappointment requires a cooling-off period of three years before further service.

Statutory registers

Mandatory company records including the register of members, debenture holders, directors, charges, and interested contracts, open to prescribed inspection and retained for specified periods.

Annual return certification

The annual return must be certified by a practising company secretary for listed companies and companies exceeding prescribed paid-up capital or turnover thresholds.

Board meeting gap

At least four board meetings must be held each year, with no more than 120 days between two consecutive meetings, and minutes recorded within 30 days.

Charge registration deadline

A charge created on company assets must be filed with the registrar within 30 days of creation; satisfaction of the charge is filed within 30 days of full satisfaction.

Unpaid dividend account

Dividends declared must be paid within 30 days; unpaid amounts move to a separate unpaid dividend account and, after seven years, to the investor protection fund.

Secretarial standards

Mandatory standards on board and general meetings issued by the professional institute; any deviation must be disclosed in the board report together with the reasons.

Accounting equation

Assets equal liabilities plus equity. Every transaction keeps this balance, and the trial balance verifies arithmetic equality before adjusting entries are posted.

Working capital cycle

Inventory days plus receivable days minus payable days. A shorter cycle lowers the cash tied up in operations and reduces external financing needs.

Degree of operating leverage

Contribution divided by earnings before interest and tax. Higher fixed costs raise operating leverage, making profit more sensitive to changes in sales volume.

Weighted average cost of capital

The weighted average of after-tax cost of debt and cost of equity, weighted by market value proportions. It is the minimum acceptable return for new projects.

NPV versus IRR conflict

When projects differ in scale or timing, NPV and IRR may rank them differently. NPV is preferred because it measures absolute value added to shareholders.

DuPont analysis

Return on equity decomposed into net profit margin, asset turnover, and equity multiplier, showing whether returns come from profitability, efficiency, or leverage.

Threats to independence

Self-interest, self-review, advocacy, familiarity, and intimidation. Safeguards include engagement rotation, independent quality review, and declining conflicting work.

Confidentiality duty

A member must not disclose client information acquired professionally, and the duty survives the engagement's end; disclosure is allowed only with consent or legal obligation.

Insider tipping

Communicating unpublished price-sensitive information to another person is itself prohibited, even if the tipper does not trade and receives no benefit.

Whistleblower protection

A person reporting a genuine concern in good faith to an authorised channel is protected from retaliation, and the reporter's identity must be kept confidential.

Takeover open offer trigger

Acquiring 25% or more of voting rights triggers a mandatory open offer for at least 26% of the voting capital; crossing 5% requires disclosure.

Unpublished price-sensitive information

Information not generally available that could materially affect share price. Trading or communicating it is prohibited unless a specified defence applies.

Minimum public shareholding

A listed company must maintain at least 25% public shareholding; falling below the threshold requires rectification within the prescribed period.

T+1 settlement

Trades in most listed securities settle on the next working day, with pay-in of funds and securities and pay-out of entitlements completed under the prescribed cycle.

Fraudulent trade practices

Manipulative devices, misleading statements, or artificial price movements that create a false market are prohibited and attract civil and criminal penalties.

Fayol's management functions

Planning, organising, commanding, coordinating, and controlling. Gulick's POSDCORB adds staffing, directing, reporting, and budgeting to this framework.

Theory X and Theory Y

Theory X assumes employees dislike work and need close control; Theory Y assumes they seek responsibility and self-direction, shaping contrasting management styles.

Maslow's hierarchy

Needs progress from physiological and safety through social and esteem to self-actualisation; lower needs must be reasonably met before higher needs motivate behaviour.

Porter's five forces

Industry rivalry, threat of new entrants, threat of substitutes, supplier bargaining power, and buyer bargaining power jointly determine industry attractiveness and profitability.

Recovery time and point objectives

Recovery time objective is the maximum tolerable downtime; recovery point objective is the maximum tolerable data loss. Both drive backup and continuity design.

Multi-factor authentication

Authentication using two or more distinct factors from knowledge, possession, and inherence. Two passwords or two one-time codes remain single-factor.