ICAEW BL · Chapter 8 · Question 10 of 10
Which of the following statements about the differences between a private and a public company limited by shares is correct?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) A public company must have at least two directors, whereas a private company may have only one
Explanation
Under s154 Companies Act 2006, a private company must have at least one director and a public company at least two, so option A reverses the rule. Private companies are prohibited from offering their shares to the public (s755), which is a main reason to become a public company. Public companies must hold an AGM every year (s336), whereas private companies generally need not.
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