ICCSSL Business Law Practice Questions - ICCSSL Business Law Module (Subject 2306) Exam

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What is the statutory requirement for the board of directors immediately after a company makes a distribution (such as a dividend) under Section 56 of the Companies Act No. 7 of 2007?

They must obtain approval from the Registrar of Companies within 7 days. The directors who voted in favor must sign a certificate stating that in their opinion, the company will satisfy the solvency test immediately after the distribution. They must publish the distribution in at least three national daily newspapers. They must file a declaration of solvency with the Commercial High Court of Colombo.

Correct Answer:

The directors who voted in favor must sign a certificate stating that in their opinion, the company will satisfy the solvency test immediately after the distribution.

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