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Q1) The holders of 900,000 of the 1,000,000 ordinary shares of Change plc vote on a poll to alter the company’s name. Each share carries one vote.
The minimum number of votes which must be cast in favour of the resolution to give effect to it is A 600,000
B 675,000
C 675001
D 750000The answer is b. The answer key states that actual votes cast need to be considered, and we need 75% votes on special resolution so 900000 *75%. I want to relate it to next question now
Q2) The holders of 900,000 of the 1,000,000 ordinary shares of Change Ltd vote on a written resolution to alter the company’s name. Each share carries one vote.
The minimum number of votes which must be cast in favour of the resolution to give effect to it is
A 600000
C 675000
B 675,001
D 750,000Here the answer is 750000. Why are the actual votes cast not considerEd here? (Like 900k *75%) Answer says Bcz for a written resolution we need 75% (special majority) for the kind of business being passed
I don’t understand the explanation
This is a great question!
Below are two extracts from the Companies Act 2006. Section 288 tells us that a written resolution is passed when it has received the approval of the same proportion of eligible votes as if it had been proposed at a general meeting – so 75%
BUT, in the case of a written resolution, it is passed when that required percentage has been reached approving the resolution. So there needs to be 750,000 votes in favour to pass a written resolution.
To extend your line of thought, say only 10,000 eligible members out of 1,000,000 voted … AND THEY ALL VOTED IN FAVOUR. Does that mean that the written resolution is passed by a unanimous vote in favour?
288(5)A written resolution of a private company has effect as if passed (as the case may be)—
(a)by the company in general meeting, or …296Procedure for signifying agreement to written resolution
(1)A member signifies his agreement to a proposed written resolution when the company receives from him (or from someone acting on his behalf) an authenticated document—
(a)identifying the resolution to which it relates, and
(b)indicating his agreement to the resolution.
(2)The document must be sent to the company in hard copy form or in electronic form.
(3)A member’s agreement to a written resolution, once signified, may not be revoked.
(4)A written resolution is passed when the required majority of eligible members have signified their agreement to it.OK now?
No, written resolution can be either ordinary majority or special depending on the business being passed. Since it’s the alteration of company name it needs 75%.
1)Why not 75% of 900000 like the the first question? Why 75% of 1000000?
2) why in the first question 75% of 900000? Why not 75% of 1000000?Are there differnet rules for special and written resolution kindly explain
Ok so can you confirm this?
Written resolution need approval of 50%+ or 75% of those ENTITLED TO vote
Where as special resolution needs 75% majority of votes actually cast.You’ve got it! I thought that that was what I indicated in my last post.
In my previous post I gave you the possibility that a written resolution could be passed with a 100% majority if only 10,000 out of a million were cast. And that clearly is a nonsense.
But if that resolution were put to a general meeting and only 10,000 out of 1 million votes were cast, then the resolution would be passed with only 7,500 votes in favour.
OK now?
I’m sorry again, so this “Written resolution need approval of 50%+ or 75% of those ENTITLED TO vote
Where as special resolution needs 75% majority of votes actually cast.” Was correct?I’m sorry again, so regarding my previous reply? I was correct? Special res needs 75% of actual casted votes in favour to pass. Written needs 50-75% of those entitled to vote. What about ordinary resolution, same as special?
You write “I’m sorry again, so regarding my previous reply? I was correct? Special res needs 75% of actual casted votes in favour to pass.”
This is correct
You also write “Written needs 50-75% of those entitled to vote.”
I don’t like the way you have combined the 2 resolutions! If the written resolution is a SPECIAL resolution, it needs the approval of not less than 75% of the ENTITLED votes.
If the written resolution is an ORDINARY resolution, it needs the approval of one more vote than 50% of the ENTITLED votes.
The situation is different when the resolution is put to a general meeting of the company.
In both cases, the resolution would be passed where the required percentage of the VOTES CAST is achieved.
Better?
Hi Mike, I found this question in ACCA specimen:
À written ordinary resolution requires the approval of which of the following?
More than 50% of those actually voting
More than 50% of those entitled to vote
Unanimous approval of those entitled to voteAcca says on website answer is B. And it’s correct as to how you explained me in the last reply. But bpp says answer is A. I presume it’s wrong. And I should follow acca website?
The correct answer is B. I would like for you to confirm that you have not misread the BPP question stem.
As I acceded in an earlier response this evening, BPP (and other publishers) do make errors. Thankfully, the incidence of such mistakes is rare.
I confirmed, Kaplan and acca website match.but Bpp says A. So thankyou for clearing.
Additional question (sorry ask too many) if this was just an ordinary resolution it would be then be A right?‘Additional question (sorry ask too many) if this was just an ordinary resolution (NOT A WRITTEN RESOLUTION AND THEREFORE PROPOSED AT AN ACTUAL PHYSICAL GENERAL MEETING OF THE COMPANY) it would be then be A right?’
Correct
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