TUTORIAL TOPIC 5

STRUCTURE QUESTIONS

1. After a company is incorporated, it needs financial resources to run its business activities.
Describe TWO (2) different sources of company fund that can be acquired by a company
(4 marks)

2. Explain FOUR (4) different types of share capital. Provide example for each type of share
capital (12
marks)

3. S. 69 of the Companies Act 2016 provides that ‘subject to the constitution of the company,
shares in a company may be issued in different classes’. Identify FOUR (4) differences
between ordinary shares and preferences shares. (8
marks)

ESSAY QUESTIONS

1. Mary Kayes Sdn Bhd is a newly incorporated company that plans to raise the capital for their
company through share capital. As a private company is prohibited from offering its shares to
the public, they seek your advice on whom shall they approach to offer to buy the shares in
their company and the consequences if they offer the shares to the public. Advise Mary
Kayes Sdn Bhd by referring to the relevant provisions in the Companies Act 2016.
(8 marks)

2. Ethan is planning to buy shares in Bank Mulia Berhad. He wants to take up a loan from Bank
Mulia to buy the shares. Advise him on whether he is allowed to do so under the law. If the
situation is different e.g. Ethan is planning to take up loan from Norwich Bhd in order to buy
shares in the company, will your advice differs?
 (8 marks)

3. Both Tom and Jerry are being offered to buy shares issued by Cats and Mouse Bhd. They are
given two (2) options; either to buy ordinary shares or preferences shares. Tom is a busy
businessman who has no time to join any shareholders meeting and is only interested to
receive dividends from the share he holds in the company, while Jerry wants to be actively
involved in the management of the company.

Advise Tom and Jerry on the differences between ordinary shares and preferences shares and
suggest which type of shares is suitable for each of them.
(15 marks)