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    Question

    The Board of Directors of a company need approval at the

    company general meeting for contribution, to bona fide charitable and other funds, exceeding _________________ of its average net profits for the three immediately preceding financial years.
    A 5% Correct Answer Incorrect Answer
    B 15% Correct Answer Incorrect Answer
    C 25% Correct Answer Incorrect Answer
    D 51% Correct Answer Incorrect Answer

    Solution

    Under section 181 of the Companies Act, the Board of Directors of a company may contribute to bona fide charitable and other funds; for contributions exceeding 5% of its average net profits for the three immediately preceding financial years, approval at company general meeting is required.

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