1. Chapter 5 Forming a Company and Issuing Shares

2. Lecture Topics Formation of companies Accounting for share capital Undersubscription and oversubscription Issue of different types of shares Subsequent share issues Forfeiture of shares and reissue

3. Lecture References Text - Chapter 5 Corporations Act 2001

4. Key Concepts Registration Company constitution Underwriting Prospectus Stock exchange listing Share capital

5. Key Concepts Subscription Share option Forfeiture of shares

6. Formation of Companies Registration – Application – ASIC Constitution – Replaceable rules – Adoption and changes

7. Formation of Companies Initial administration – Appointment of officers – Record-keeping Minutes Registers Underwriting

8. Raising Equity Capital The disclosure document – Prospectus content – Other disclosure document – Regulated vs unregulated offers Trading in securities – Listing on the ASX – Regulation of secondary trading

9. Share Capital Types of shares – Ordinary – Preference repayment of capital participation in surplus assets and profits dividends voting Classification of shares for financial reporting

10. Share Capital Components of share capital – Issue price – Called-up amount – Paid-up amount Share issue procedure – Offer – Application – Allotment of shares

11. Accounting for Share Capital Direct Method Application Public applies for shares via prospectus DrTrustaccountxx CrApplicationxx

12. Accounting for Share Capital Direct Method Allotment Directors approve share allocation DrApplicationxx CrPaid-up capitalxx Dr Bankxx Cr Trust accountxx

13. Accounting for Share Capital Direct Method Additional amount payable on allotment DrAllotmentxx CrPaid-up capitalxx DrBankxx Cr Allotmentxx

14. Accounting for Share Capital Direct Method Calls – call made on partly paid shares DrCallxx CrPaid-up capitalxx Dr Bankxx Cr Callxx

15. Oversubscription Excess application monies returned Dr Applicationxx Cr Trust accountxx

16. Over Subscription Excess retained and offset against amount due on allotment Dr Applicationxx CrAllotmentxx DrBankxx CrTrust accountxx

17. Over Subscription Excess retained and off-set against amount due on calls Dr Applicationxx Cr Calls in advancexx DrCalls in advancexx CrPaid-up capitalxx

18. Issue of Different Types of Shares Issue of both preference and ordinary shares Public applies for shares via prospectus DrTrustaccountxxx CrApplication- ordinaryxx CrApplication - preferencexx

19. Issue of Different Types of Shares Allotment DrApplication- ordinaryxx Dr Application - preferencexx Dr Paid-up capital - ordinaryxx CrPaid-up capital - preferencexx Dr Bankxxx Cr Trust accountxxx

20. Issue of Different Types of Shares Share issue costs – Asset or expense? – AASB 1015 – UIG Abstract 23 – Mechanics of the process Transaction costs arising of the issue of equity instruments

21. Subsequent Share Issues Rights issue Unregulated share issue Bonus issue Share options – The ‘usual’ treatment – Financial reporting and the substance of the option

22. Forfeiture of Shares Effect of forfeiture – Unpaid calls – Reissue – Costs of forfeiture and reissue Accounting for forfeiture

23. Forfeiture of Shares Call made by directors DrCallxx Cr Paid-up capitalxx Call monies mostly received DrBank xx CrCall xx

24. Forfeiture of share with calls outstanding DrPaid-up capitalxx CrCallx CrPaid up cap. - forfeited shares x Amount called up Amount unpaid Amount paid Forfeiture of Shares

25. Reissue of Shares DrBankx Dr PuC forfeited sharesx CrPaid-up capitalxx Return of surplus to original s/holder DrPaid-up capital xx CrBank xx

26. Where to get more information Other courses List books, articles, electronic sources