There are three types of authorities in a company: managing authorities, supervisory authorities, and judicial authorities. Managing authorities include the directors who are responsible for running the day-to-day operations of the company. Directors have duties like preparing annual member lists, calling shareholder meetings, enforcing calls for unpaid stock, declaring dividends, and presenting financial reports. They also have powers granted by the articles of association like raising capital, issuing shares and debentures, investing company funds, and approving employee bonuses. Directors serve three-year terms and can be removed by shareholder resolution.

1. Objective
To Learn
1. The concept of authorities in
company
Introduction:
Company is artificial person having
no physical existence so some
natural person are required to run
the function and affairs of the
company
Those functionaries will be given
some authorities for the efficient
management
There are different authorities in
company
Managing authorities
Supervisory authorities
Judicial authorities
Duties of director:
 performed all the duties imposed by
ordinance and AOA
 Prepare the Annual list of Member
 To hold a statutory meeting
 Forward the statutory report to every
member
 To call for an extra ordinary GM on
the request of member
 To appoint the first Auditor
 To enforce the call
 To declare the dividend
 Propose for the reserve fund
 To present profit and loss account
before meeting .etc
Powers of director:
- In AOA one clause is power management
Clause
- Can call for money
- Can issue the share
- Can issue debenture
- Can invest the fund of the company
- Can make loan
- Can approve bonus to employee
- Can announce the dividend etc
(The share holder may enlarge the power)
Removal:
- By resolution in GM
Retirement:
- Duration is three year
- The first director on the date of 1st AGM
- Subsequent director after every three year
- They shall perform their function until their
Successor are elected
- Must be reported to the registrar with in
Fifteen days
Director
Definition:
The person or group of persons who act as
a agent and handle the managing activities
of the company
Typology:
Initial director
Appointed by the promotes at the time
of formation
Subsequent director
Appointed in AGM
Appointment:
First directors are to be determined by
the majority of the subscriber
Subsequent directors will be in AGM by
passing a resolution
Qualification :
Natural person
- What is fixed by the AOA?
- Like holding at least one share
- The qualification must be disclosed
in prospectus
Disqualification:
- Minor
- Un sound mind
- Insolvent
-Convicted by moral turpitude
- Debarred from holding such office
- Is not a member
- Failed to obtain qualification share
- Failed to pay call
- Holding office of profit in the company
- Absent from meeting
Consent of director:
Written consent will be filed with the
Registrar
*(Not in the case of Private Company)
Liability:
May made unlimited if provided by AOA.
Remuneration:
Usually provided in AOA by express
agreement
It must be stated in prospectus
May be paid from the capital
(Even if no profit is obtain)
Subject: Company Law
Standard: LL.B second year
Topic: Authorities in Company
MUNIR HUSSAIN KTK
Lecturer
UNIVERSITY LAW COLLEGE
QUETTA
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