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resolutions

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA LW Exams › resolutions

  • This topic has 3 replies, 2 voices, and was last updated 3 years ago by MikeLittle.
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  • January 19, 2022 at 5:23 pm #647045
    AlinaaF
    Participant
    • Topics: 31
    • Replies: 17
    • ☆

    I am stuck on where to use the ordinary resolution and special resolution?

    Do we have to memorize each situation where these resolutions need to be passed?

    And these resolutions can be passed by either public or private companies (or both?)

    Thanks for your previous replies 🙂 Have a good day!

    January 19, 2022 at 9:27 pm #647064
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23316
    • ☆☆☆☆☆

    Alina ( a lovely Lithuanian name!) no, there’s no need to remember all the situations where each of these resolutions needs to be applied

    Take it as though the ordinary resolution is the default category leaving just the special resolutions (and the ordinary resolutions that require special notice) as ones to remember

    The special notice ordinary resolutions are just 5 in number – 1 relating to directors and the other 4 relating to auditors so that’s surely easy enough to remember

    As for special resolutions – if you consider that, as a generalisation, these are required where there is a change in the constitution of the company, you’ll not go far wrong

    The law about the applicability of each type doesn’t distinguish between public and private companies. Having said that, the HUGE majority of private companies won’t have auditors so the 4 ordinary resolutions requiring special notice are largely irrelevant for the private companies

    Is that better?

    January 20, 2022 at 6:22 pm #647150
    AlinaaF
    Participant
    • Topics: 31
    • Replies: 17
    • ☆

    Thanks, BUT I need to know this too.

    Could you tell me the 5 situations where ordinary resolution with special notice is used (I know only two such as):

    1) Removal of director
    2) Removal of auditor

    Please mention the rest of it so that I can remember them.

    Secondly, I just have to remember that special resolution is used whenever there is a change in the constitution of the company (i.e. articles of association).

    BUT I am still stuck that what comes in the constitution of the company such as whether the change in company’s name OR change in memorandum of association?

    ANYTHING else that does not need the constitution of the company to be changed then we need ordinary resolution to be passed.

    January 20, 2022 at 8:07 pm #647153
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23316
    • ☆☆☆☆☆

    Page 97 of the course notes – ignore the ‘overage director’ situation – the last of 6 identified ordinary resolutions requiring special notice – it no longer applies

    Alina, there are approximately 32 matters that require the approval of a special resolution

    You can NEVER be asked for the detail of those 32 matters

    You are correct in identifying change of name and change of objects. These, I suggest, are the 2 major matters but I’m struggling to find a likely situation where you will need to select ‘special resolution’ as the answer to a multi-choice question. It really is unlikely to happen

    Members passing a resolution to apply to the Court for a compulsory winding up would be another. Or passing a resolution to approve the appointment of multiple directors in a single resolution would be another. But, trust me, we’re heading off into fringe areas here

    Should you come across a question in the revision kit that you’re using that specifically asks for the appropriate resolution in the circumstances detailed in the question, I would be mightily surprised

    But, if you do, please let me know!

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