Q&A-4.1
Paper 4 Corporate Restructuring And Insolvency
Syllabus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.2
Bird's-Eye View . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.4
Line Chart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.8
Frequency Table Showing Distribution of Marks . . . . . . . . . . . . . . . . . . Q&A-4.9
Frequency Table Showing Marks of Compulsory Questions . . . . . . . . . Q&A-4.10
Legends for the Graphs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.11
Study Material Based Contents
1. Study (I) Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.13
2. Study (II) Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.23
3. Study (III) Mergers and Amalgamations . . . . . . . . . . . . . . . . . . . . . Q&A-4.35
4. Study (IV) Takeovers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.85
5. Study (V) Funding of Mergers and Takeovers . . . . . . . . . . . . . . . Q&A-4.113
6. Study (VI) Valuation of Shares and Business . . . . . . . . . . . . . . . . Q&A-4.125
7. Study (VII) Corporate Demergers and Reverse Mergers . . . . . . . . Q&A-4.142
8. Study (VIII) Post Merger Re-organisation . . . . . . . . . . . . . . . . . . . . Q&A-4.170
9. Study (IX) Financial Restructuring . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.176
10. Study (X) Revival and Restructuring of Sick Companies . . . . . . Q&A-4.198
11. Study (XI) Case Studies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.210
12. Study (XII) Legal Documentation . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.215
13. Study (XIII) Securitization and Debt Recovery . . . . . . . . . . . . . . . . Q&A-4.224
14. Study (XIV) Winding-Up . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.245
15. Study (XV) Cross Border Insolvency . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.267
16. Objective Questions . . . . . . . . . . . . . . . . . . . . . . . . . . . Q&A-4.276
Question Paper of December, 2011 . . . . . . . . . . . . . . Q&A-4.287
Question Paper of June, 2012 . . . . . . . . . . . . . . . . . . . Q&A-4.289
Question Paper of December, 2012 . . . . . . . . . . . . . . Q&A-4.294
Question Paper of June, 2013 . . . . . . . . . . . . . . . . . . . Q&A-4.299
Q&A-4.2
SyllabusPaper 4 (100 marks)
Corporate Restructuring and Insolvency
Level of knowledge : Expert knowledge.
Objectives : To provide an in-depth understanding of all aspects of law and
practical issues relating to corporate restructuring and insolvency.
Part A : Corporate Restructuring (70 marks)
Detailed contents :
1. Introduction
Meaning of corporate restructuring, need, scope and modes of restructuring,
historical background, global scenario, national scenario.
2. Strategies
Planning, formulation and execution of various corporate restructuring
strategies - mergers, acquisitions, takeovers, disinvestments and strategic
alliances, demergers and hiving off.
3. Mergers and Amalgamations
Meaning and concept; legal, procedural, economic, accounting, taxation and
financial aspects of mergers and amalgamations including stamp duty and
allied matters; interest of small investors; merger aspects under competition
law; jurisdiction of courts; filing of various forms; Amalgamation of banking
companies and procedure related to Government companies; Cross border
mergers.
4. Takeovers
Meaning and concept; types of takeovers; legal aspects - SEBI takeover
regulations; procedural, economic, financial, accounting and taxation aspects;
stamp duty and allied matters; payment of consideration; bail out takeovers and
takeover of sick units; takeover defences; cross border takeovers.
5. Funding of Mergers and Takeovers
Financial alternatives; merits and demerits; funding through various types of
financial instruments including equity and preference shares, options and
securities with differential rights, swaps, stock options; ECBs, funding through
financial institutions and banks; rehabilitation finance; management
buyouts/leveraged buyouts.
6. Valuation of Shares and Business
Introduction; need and purpose; factors influencing valuation; methods of
valuation of shares; corporate and business valuation.
7. Corporate Demergers and Reverse Mergers
Concept of demerger; modes of demerger - by agreement, under scheme of
arrangement; demerger and voluntary winding up; legal and procedural
Q&A-4.3
aspects; tax aspects and reliefs; reverse mergers – procedural aspects and tax
implications.
8. Post Merger Re-organisation
Factors in post merger reorganization: integration of businesses and
operations, financial accounting, taxation, post merger valuation, human and
cultural aspects; assessing accomplishment of post merger objectives;
measuring post merger efficiency.
9. Financial Restructuring
Reduction of capital; reorganisation of share capital Buy-back of shares –
concept and necessity; procedure for buy-back of shares by listed and unlisted
companies.
10. Legal Documentation.
11. Case Studies.
Part B – Corporate Insolvency (30 Marks)
12. Revival, Rehabilitation and Restructuring of Sick Companies
Sick companies and their revival with special reference to the law and
procedure relating to sick companies.
13. Securitisation and Debt Recovery
Securitisation Act :
Overview of the Securitisation and Reconstruction of Financial Assets and
Enforcement of Security Interest Act, 2002; process; participants; Special
Purpose Vehicle (SPV), Asset Reconstruction Companies (ARCs), Qualified
Institutional Buyers (QIB).
Debt Recovery Act :
Overview of the Recovery of Debts Due to Banks and Financial Institutions Act,
1993; Tribunal, Procedure; compromises and arrangements with banks and
creditors.
14. Winding up
Concept; modes of winding up; administrative machinery for winding up.
Winding up process and procedure; managing stakeholders and parties in
liquidation; conducting meetings of shareholders/creditors etc.; dealing with
contracts; mana ging estate; outsourcing responsibi l i t ies to
professionals/service providers such as valuers, security agencies, etc; best
practices in performing liquidation/administrator functions; accountability and
liabilities; Role of liquidators and insolvency practitioners. Consequences of
winding up; winding up of unregistered companies; dissolution.
15. Cross Border Insolvency.
Q&A-4.4
Bird's-Eye View
Paper 4
Corporate Restructuring - And Insolvency
Question Paper Based Contents of Last Five Examinations
Years Q. No. Chapter Page
No.No. Name
2011
June
1. (a)
(b)
(c)
2. (a)
(b)
(c)
3. (a)
(b)
4. (a)
(b)(i)
(ii)
(c)
5. (a)
(b)
(c)
(d)(i)
(ii)
(iii)
6. (a)
(b)
7. (a)
(b)
(c)
8. (a)
(b)(i)
(ii)
(iii)
3
16
9
3
3
6
4
4
5
4
4
3
9
9
12
9
9
9
10
13
14
14
13
15
13
14
15
Mergers and Amalgamations
Objective Questions
Financial Restructuring
Mergers and Amalgamations
" " " "
Valuation of Shares Business
Takeovers
" " "
Funding of Mergers and Takeovers
Takeovers
" " "
Mergers and Amalgamations
Financial Restructuring
" " " "
Legal Documentation
Financial Restructuring
" " " "
" " " "
Revival and Restructuring of Sick Companies
Securitization and Debt Recovery
Winding-Up
" " " "
Securitization and Debt Recovery
Cross Border Insolvency
Securitization and Debt Recovery
Winding-Up
Cross Border Insolvency
78
280
186
37
55
132
110
99
119
99
99
80
186
186
223
187
187
187
202
239
257
257
233
272
237
246
268
2011
Dec.
1. (a)
(b)
(c)
(d)
2. (a)
7
16
3
2
6
Corporate Demergers and Reverse Mergers
Objective Questions
Mergers and Amalgamations
Strategies
Valuation of Shares Business
160
281
55
30
140
Q&A-4.5
(b)
(c)
3. (a)
(b)
4. (a)
(b)
(c)
5. (a)
(b)
(c)
6. (a)
(b)(i)
(ii)
7. (a)
(b)
(c)
8. (a)
(b)
(c)
3
3
4
9
6
3
9
3
3
4
14
13
13
13
14
10
15
13
13
Mergers and Amalgamations
" "
Takeovers
Financial Restructuring
Valuation of Shares Business
Mergers and Amalgamations
Financial Restructuring
Mergers and Amalgamations
" "
Takeovers
Winding-Up
Securitization and Debt Recovery
" "
" "
Winding-Up
Revival and Restructuring of Sick Companies
Cross Border Insolvency
Securitization and Debt Recovery
" "
56
56
111
187
133
57
188
58
58
100
258
225
237
233
258
202
273
239
233
2012
June
1. (a)
(b)
(c)
(d)
2. (a)
(b)
3.
4. (a)
(b)
5. (a)
(b)
(c)
6. (a)
(b)
7. (a)
(b)
(c)
8. (a)
(b)
2
2
3
16
3
5
9
3
5
5
6
7
13
10
14
13
15
14
15
Strategies
" "
Mergers and Amalgamations
Objective Questions
Mergers and Amalgamations
Funding of Mergers and Takeovers
Financial Restructuring
Mergers and Amalgamations
Funding of Mergers and Takeovers
" "
Valuation of Shares Business
Corporate Demergers and Reverse Mergers
Securitization and Debt Recovery
Revival and Restructuring of Sick Companies
Winding-Up
Securitization and Debt Recovery
Cross Border Insolvency
Winding-Up
Cross Border Insolvency
31
31
59
283
59
123
196
80
120
120
133
161
236
203
266
234
273
258
273
Q&A-4.6
2012
Dec.
1. (a)
(b)
(c)
(d)
2. (a)
(b)
3.(a) (i)
(ii)
(b)
(c)
4. (a)
(b)
(c)
5. (a)
(b)
(c)
6. (a)
(b)
(c)
7. (a)
(b)
(c)
8. (a)
(b) (i)
(ii)
(c)
3
16
2
2
3
3
6
6
3
7
7
3
12
12
6
12
13
13
14
13
13
13
14
15
13
15
Mergers and Amalgamations
Objective Questions
Strategies
" "
Mergers and Amalgamations
" "
Valuation of Shares Business
" "
Mergers and Amalgamations
Corporate Demergers and Reverse Mergers
" "
Mergers and Amalgamations
Legal Documentation
" "
Valuation of Shares Business
Legal Documentation
Securitization and Debt Recovery
" "
Winding-Up
Securitization and Debt Recovery
" "
" "
Winding-Up
Cross Border Insolvency
Securitization and Debt Recovery
Cross Border Insolvency
60
284
31
31
81
60
133
133
60
161
161
60
219
219
134
219
234
239
259
234
235
235
260
269
238
273
2013
June
1. (a)
(b)
(c)
(d)
2. (a)
(b)
(c)
3. (a)
(b)
(c)
4. (a)
(b)
5. (a)
(b)
(c)
1
2
4
16
3
3
3
8
3
3
7
6
12
4
4
Introduction
Strategies
Takeovers
Objective Questions
Mergers and Amalgamations
" "
" "
Post Merger Re-organisation
Mergers and Amalgamations
" "
Corporate Demergers and Reverse Mergers
Valuation of Shares Business
Legal Documentation
Takeovers
Takeovers
21
32
100
285
82
61
83
173
83
83
162
134
221
100
100
Q&A-4.7
6. (a)
(b)
7. (a)
(b)
(c)
8. (a)(i)
(ii)
(iii)
(b)
13
13
14
15
15
15
13
14
13
Securitization and Debt Recovery
" "
Winding-Up
Cross Border Insolvency
" "
" "
Securitization and Debt Recovery
Winding-Up
Securitization and Debt Recovery
240
236
261
273
273
269
225
246
236
Question upto Dec. 2008 are from CS Final Gr. II Old Course and from June 2009onwards are from CS Professional Programme New Course.
Q&A-4.13
Star Rating
On the basis of Maximum marks from a chapter Nil
On the basis of Questions included every year from a chapter Nil
On the basis of Compulsory questions from a chapter j
1 Introduction
This Chapter Includes : Meaning of corporate restructuring, Need, Scope and
modes of restructuring, Historical background, Global scenario, National scenario.
Marks of Short Notes, Distinguish Between, Descriptive & Practical Questions
SHORT NOTES
2004 - June [8] (b) Write short notes on the following:
(ii) Disinvestment policy of the government (3 marks)
Answer :
Y The term ‘disinvestment’ refers to the act of transfering public sector undertaking
to private sector.
Q&A-4.14 O Solved Scanner CS Prof. Prog. M-II Paper 4
Y Disinvestment is thus a method for privatisation which is one of the three objectives
(LPG-Liberalisation, Privatisation and Globalisation) covered under the New
Economic Policy (NEP).
Y An advisory body in form of Disinvestment Commission was set up on 23rd August
1996 so as to give advice in relation to disinvestment of public sector undertaking.
Y The process undertaken for disinvestment is as follows :
C Proposals for disinvestment by Disinvestment Commission.
C Proposals reviewed by Cabinet Committee on Disinvestment (CCD)
C Clearance of proposal by CCD & appointment of advisor
C Advertisement & shortlisting of tentative bid
C Consent of Inter Ministerial Group over the share purchase & shareholders
agreement.
C Evaluation by Comptroller & Auditor General (CAG)
2007 - June [8] Write notes on the following:
(i) Restructuring. (4 marks)
Answer :
Restructuring
Y The term ‘restructuring’ means to rebuild or rearrange.
Y Restructuring is a means whereby the organisational structure is changed so that
the organisation accomplishes its objectives.
Y ‘Corporate Restructuring’ is a term of wider importance and covers in its ambit
restructuring or reorganizing or financial restructuring of any organisation done in
order to operate more effectively and efficiently.
DESCRIPTIVE QUESTIONS
2003 - Dec [1] {C} (a) "On-going corporate restructuring is a must for survival due to
globalisation, liberalisation and economic reforms." Discuss. (12 marks)
Answer :
Y “On going corporate restructuring is a must for survival due to globalisation,
liberalisation and economic reforms”, The statement is quite apt taking into account
the present scenario.
Y Rapid economic reforms have been witnessed recently both at the national and
international levels.
Y Globalisation has gained momentum over these years and as a result the Indian
economy has integrated with the world economy, proving the whole world to be
‘global village’.
Solved Scanner CS Executive ProgrammeTax Laws and Practice Paper-4 Dec 2013
Publisher : Shuchita Prakashan ISBN : 9789350347492 Author : Dr. Arun Kumarand CA Raj K Agrawal
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