PART A

Answer ALL questions

1. State any FOUR (4) functions of the Companies Commission of Malaysia (CCM)
I. Section 17. Functions of the Commission. :The functions of the Commission shall be—
a. to ensure that the provisions of this Act and the laws specified in the First Schedule are
administered, enforced, given effect to, carried out and complied with;
b.   to act as agent of the Government and to provide services in administering, collecting and
enforcing payment of prescribed fees or any other charges under the laws specified in the
First Schedule;
c.   to regulate matters relating to corporations, companies and businesses in relation to the laws
specified in the First Schedule;
d.   to encourage and promote proper conduct amongst directors, secretaries, managers and other
officers of a corporation, and self-regulation by corporations, companies, businesses, industry
groups and professional bodies in the corporate sector in order to ensure that all corporate and
business activities are conducted in accordance with established norms of good corporate
governance;
e.   to enhance and promote the supply of corporate information under any laws specified in the
First Schedule and to create and develop a facility whereby any corporate information
received by, or filed or lodged with, the Commission may be analysed and supplied to the
public;
f. to carry out research and commission studies on any matter relating to corporate and business
activities;
g.   to advise the Minister generally on matters relating to corporations, companies and
businesses in relation to the laws specified in the First Schedule; and
h.   to carry out all such activities and do all such things as are necessary or advantageous and
proper for the administration of the Commission, or for such other purpose as may be
directed by the Minister.

(4 MARKS)

2. What are the factors to consider before choosing a name for an intended company?
The following principles should be observed when deciding on a name of a company:

(a) Correct spelling and proper grammar must be used;

(b) The use of mixture of Bahasa Malaysia and English is allowed if the use is
to describe the type of business and must follow proper grammar.

(c) If a name contains words other than the Malay or English Languages,
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 the meaning of such words must be given;

(d) Names which are not blasphemous or likely to be offensive to members of

the public;

(e) Names which do not resemble elements of religion;

(f) Refrain from using words which are too general, for example
“Technology Sdn. Bhd.” or “International Sdn. Bhd.”;

(g) Only names of directors who are specified at the application form for
incorporation can be used as company names. Proof of relationship must
be given if other individual names are proposed to be used. Similarly, consent
letter must be obtained from the group of companies whose individual
names are proposed;

(h) The meaning of created or coined words must be given;

(i) The name refers to the name of the director or owner

(j) Use symbols that are allowed to be used in the name of the company is
limited to 5 symbols only and must be appropriate to the use of:

(i) “&” (include “dan”, ‘and” and “N”)

Example : D&T Services Sdn. Bhd.

(ii) “.” (“dot” symbol)

Example : Mr. John Trade Sdn. Bhd.

(iii) “-“ (“hyphen” symbol).

Allowed only for double words or common words that use
hyphen.
Example : Kupu-Kupu Design Sdn. Bhd.
Focus Re-Engineering Sdn. Bhd.

(iv) “( )” bracket symbol

Example : ZY Advertising (2017) Sdn. Bhd.

(v) “ ’ ” ( “apostrophe” symbol)

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 Example : Mum’s Recipe Sdn. Bhd.
Dato’ Yusoff Yahaya Trading Sdn. Bhd.

(4 marks)

3. What are the characteristics of an exempt private company and state the exemptions
given to such company.
THEREFORE, ITS CHARACTERISTICS ARE:

• ITS SHARES ARE HELD BY INDIVIDUALS AND NOT COMPANIES.

• IT HAS A MEMBERSHIP OF NOT MORE THAN 20 PERSONS.

EXEMPTED FROM:
 IT IS REQUIRED TO PREPARE A BALANCE SHEET AND A PROFIT AND LOSS
ACCOUNT FOR THEIR SHAREHOLDERS, BUT IS EXEMPTED FROM HAVING TO FILE
THEM WITH THE CO’S ANNUAL RETURN WITH THE ROC (REGISTRAR OF
COMPANIES) - SUBMITTING IT FINANCIAL STATEMENTS WITH ITS ANNUAL
RETURN WITH CCM
 IT CAN ALSO GIVE LOANS TO THE DIRECTORS. - RESTRICTIONS ON LOANS TO
DIRECTORS AND PERSONS CONNECTED TO DIRECTORS UNDER SECTIONS 224 AND
225 OF THE ACT.

(4 marks)

4. List any five (5) factors to be considered before deciding on the most appropriate form
of business.
 the nature of business of the proposed company;
 the proposed address of the registered office of the proposed company;
 the status of whether the company is private or public; a name;
 one or more members, having limited or unlimited liability for the obligations of the
company;
 in the case of a company limited by shares, one or more shares; and
 one or more directors.
 Name of company

(5 marks)
PART B
Question 1
Kamal and Kamil are partners of a small business selling mutton. As business has been good,
they intend to expand and become a wholesaler to distribute mutton throughout Malaysia.
They apply to CMB Bank Berhad for a bank loan, however, the bank manager has identified
the following areas of weaknesses in their existing set -up and advise them to restructure it:

 Kamal and Kamil are personally liable for the business’s debts if the business is unable to pay
its creditors.
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 If one of them dies or becomes bankrupt or withdraws from the business, the current structure
will have to be terminated.

 The accounts of the business as prepared and signed by Kamal and Kamil are not audited by
any qualified accountant.
In view of the above weaknesses, Kamal and Kamil consulted you, a company secretary on
the best form of business to carry out the wholesale business.
(Assume Kamal and Kamil intend NOT to have more than 50 members in the proposed form
of business)

Required:
As a company secretary, you are required to:
(a) Explain to Kamal and Kamil on the most appropriate form of business that will
address the weaknesses of the existing business set up.
The suitable form of business is Private limited / shares capital Private companies as
Kamal and Kamil are personally liable for the business’s debts if the business is
unable to pay its creditors. By this form the company will liable by limited of
investment.
Apart from that Company limited by shares is one which the liability of its members
is limited by the memorandum of association to the amount if any unpaid on the
shares taken by them i.e. the liability of the members to contribute towards the assets
of the company on winding up is limited as is suitable for one of them dies or
becomes bankrupt or withdraws from the business, the current structure will have to
be terminated.
Its exempted to present to SSM account report but it will tabled audited accounts at
AGM

Companies with shares capital Private companies

1. A private companies has the following 5 characteristics:
 It has share capital
 Its Constitution (if restricts the right to transfer shares
 Limit the no to 50
 Prohibits making public issue of its shares or debenture
 Prohibits any invitation to the public to deposit money with the company.

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 (10 marks)
(b) Explain in detail the process of registering such form of business.

REGISTRATION PROCEDURE
1. Business may be registered using personal name or using a trade name. The
business name using personal name as stated in the identity card is not required to
apply for business name.
a. Example: Ruslan bin Mohamed, Siow Ah Thai or, Ramasamy a/l Mutusamy
b. Trade Name is the name of the proposed business and must obtain prior
approval from the Registrar of Business.
i. Example: Kedai Dobi Mewah, Lucky Star Catering or, ABS Unggul
Enterprise.

c. Complete the Business Registration Form (Form A) with the following

information:
i. Business name
ii. Commencement date of business
iii. Principal place of business
iv. The address of the branch of business (if any)
v. Information of owner and partners
vi. Type of business carried out
vii. Provide a copy of the Partnership Agreement (if any)

d) Every business owner and partners must sign the completed Form.
e) Owner / all partners to be present at the counter for registration.
f) Documents to be attached are as follows:
i. Permit, licence or supporting letter for the type of business

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 e.g Nurseries (Department of Social Welfare), Kindergarten,
Tuition Centres, Schools/College (Ministry/ Department of
Education); and
ii. Approval or Supporting Letter from relevant agency if required by the
Registrar of Business.

2. GENERAL GUIDE
I. Register the business not later than thirty (30) days from the date of
commencement of business.
II. A new business registration may valid for a period of one (1) year and
does not exceed five (5) years on each registration.
III. The nature of the registered business should not contravene any laws
or likely to be used for unlawful purposes or any purpose prejudicial to
or incompatible with the security of the Federation, public order or
morality.
IV. Business Registration Certificate can be obtained within one (1) hour
from the payment transaction is made.
V. A person who carries on business without registering a business
commits an offence under the ROBA 1956 and if found guilty be fined
not exceeding RM50,000.00 or imprisonment for a term not exceeding
two (2) years or both.
VI. Even though businesses have been registered with SSM, business
owners are responsible to obtain licenses, permits or approval letters
from other relevant authorities in order to operate their businesses.
(10 marks)
(Total: 20 marks)