Issue of shares at discount

[shakilicma76]

Provision regarding issue of shares at discount, procedure and who is responsible for such arrangements?

[Abdul Majid]

Dear

Company cannot issue shares at discount without the prior approval of SECP.
Special Rsolution from memebers also required for application to SECP,the maximum rate of discount allowed by SECP is 10%.

Further information is given in the Companies Ordinance

Regards,

Majid

[Dard]

Dunno about pakistani law, but in the UK a company can't issue shares at a discount. It is a crime and the directors of the company will be liable. The new shareholders will have to pay the unpaid capital plus any interest

[Abdul Majid]

Dear,

Thanks abount informing about UK Laws.In Pakistan this also very difficult to issue shares at discount,but If SECP approve than a company can issue shares at discount.
This is normally approved when market price of a company share is less than its face value.Maximum rate of discount allowed by SECP is 10%.

Majid

[Arslan01]

S.E.C.P has released an order regarding disclosure about corporate social responsibility activities in financial statements.
Now every public company shall provide descriptive as well as monetary disclosures of the Corporate Social Responsibility Activities undertaken by it during each financial year w.e.f financial year 2009-10

[Imtiaz Abbas]

Mr. Shakil question was not understood by above people who replied him. The question was to let him know about "the provision regarding issue of shares at discount, procedure and who is responsible for such arrangements?".

The answer is to read and apply the Section 84 of the Companies Ordinance 1984 together with "the Guidelines On Issue Of Shares At A Discount" issued by SECP and placed on their website.

For further clarification, please feel free to contact Imtiaz Abbas, Business & Financial Consultant