Page 198 - CA Final PARAM Digital Book.

Answer Sr.No. Query of Mr. Samay Response to Query
1 What documents to be seen in case of loan Mr. Samay should see deed of
given by the company in lieu of Hypothecation or other document
hypothecation of goods from lender as a creating the charge, together with a
security for the purpose of reporting as per statement of stocks held at the balance
clause (a) of section 143(1) of the Companies sheet date in order.
Act, 2013?
2 What shall be the cost of Debentures and For Debentures sold: Where the cost of
Bonus Shares sold by the company for which debentures sold is not ascertainable, the
the cost is not ascertainable for the purpose book value thereof at the date of sale
of reporting as per clause (c) of section 143(1) may be treated as the cost for the
of the Companies Act, 2013? purposes of this clause.
For Bonus Shares sold: When bonus
shares are received, the number of
shares in the portfolio would be
increased by the bonus shares while the
cost of the total portfolio would remain
the same as before. The result would be
that the average cost per unit of the total
holding would come down
proportionately. The usual accounting
practice for apportioning the cost of a
part of the total holding on the sale
thereof is to take it at its average cost.
3 Whether the shares allotted by Waria Ltd. The law on the subject has hitherto been
against a loan taken by it from a NBFC can be that, where the consideration for the
considered to be allotted for cash for the issue of shares is an adjustment against a
purpose of reporting as per clause (f) of bona fide debt payable in money on
section 143(1) of the Companies Act, 2013? demand by the company, the shares are
deemed to have been subscribed in cash
(vide the decision in Spargo’s Case –
1873, 8, Ch. A. 407). According to the
legal opinion obtained by the ICAI, the
expression “shares allotted for cash” may
also include shares allotted against a
debt. Therefore, in cases which are
covered by the decision in Spargo’s case,
no comment is required by the auditor,
even though the company may have in
the Return of Allotment under Section
75, shown such shares as allotted against
adjustment of a debt.
Thus, the shares allotted by Waria Ltd.
against a loan taken by it from a NBFC
can be considered to be allotted for cash.

QNO Sec 143-- EMP having adverse effect on functioning of company Old Course – (M18E)
332.100 TITANIUM CNO—Unique
Give examples of Emphasis of Matters which may have an adverse effect on the functioning of the

company as well as those which may not affect the functioning of the company. ?
Answer Examples of Emphasis of Matters which may have an Adverse Effect on the Functioning of the
Company:

➢ A major Catastrophe that has had, or continues to have, (E.g. Natural calamity)
a significant effect on the entity’s financial position.
➢ The Going concern assumption is appropriate but there (E.g. Sudden death of majority

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