ACCA LW · Chapter 9 · Question 7 of 11
Which of the following is a requirement for a private company to reduce its share capital without applying to the court?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) A special resolution supported by a solvency statement made by all the directors
Explanation
Under s641 Companies Act 2006 a private company may reduce its capital by special resolution supported by a solvency statement in which every director confirms the company can pay its debts. Alternatively, any company may reduce capital by special resolution confirmed by the court, which is the only route for a public company. The Registrar registers the documents but does not approve the resolution in advance.
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