COMPANY PROMOTION.

Auckland Star, Volume LIX, Issue 250, 22 October 1928, Page 4

COMPANY PROMOTION.

EXTRAORDINARY CASE IN SYDNEY,

Attention lias been drawn in these columns frequently to the abuses that are possible frequently tinder our present company laws, and the "Wild Cat Monthly" publishes the following report of an actual occurrence in Sydney, where the legal requirements are likewise somewhat slack. The "Wild Cat" says:—

"What is possible under the New South Wales companies law has just beep illustrated by the documents issued in connection with the liquidation of Advance Accommodations, Ltd., a company registered in Sydney. This concern began trading as a company with a capital of £30,000 in £1 shares. As a matter of fact 29,993 shares were unallotted. The company had to have seven shareholders to gain registration, and it got them—seven holders of one share each. But the balancesheet issued as at September 30 shows that not one penny of capital was actually paid, the "assets" including: "Debtorssubscribers' shares unpaid, £7." Thus this company, with a capital of £30,000 (authorised), began trading with no money of its own; even its registration had apparently to be paid for with money obtained by loan or otherwise. It is not surprising in the circumstances that, after a very brief career, it called a meeting of its creditors, with Jiabilties totalling £771 and 8/3 to pay them with.