Very Short Question and Answers - Types of Companies

A private company is a company that restricts the right of its members to transfer shares, has a minimum of 2 and a maximum of 200 members (excluding employees), does not invite the public to subscribe to its securities, and must include 'Private Limited' in its name.

The minimum number of members required to form a private company is 2.

The maximum number of members allowed in a private company is 200.

No, a private company cannot invite the public to subscribe to its securities.

A private company must include 'Private Limited' at the end of its name.

A private company can be formed with only two members, whereas a public company requires at least seven members.

No, a private company does not need to issue a prospectus since it does not invite the public to subscribe.

A private company requires a minimum of 2 directors.

No, a private company is not required to keep an index of its members.

A public company is defined as a company that has at least 7 members, no limit on the maximum number of members, and is not prohibited from inviting the public to subscribe to its securities.

The minimum number of members required to form a public company is 7.

There are no restrictions on the transfer of shares in a public company.

Yes, a public company can invite the public to subscribe to its securities.

The maximum number of directors allowed in both a public and private company is 15.

A public company requires a minimum of 3 directors, whereas a private company requires only 2 directors.

A private company has fewer regulatory requirements compared to a public company.

No, there is no maximum limit on the number of members for a public company.

A public company must prepare a prospectus when inviting subscriptions from the public.

A private company has restrictions on the transfer of shares, whereas a public company does not.

An index of members is necessary for public companies to maintain transparency and proper record-keeping of their shareholders.