Difference between Memorandum of Association (MoA) and Articles of Association (AoA)

What is Memorandum of Association (MoA)?

It is said to be the principal document of the company. In this document, the character of the company is mentioned. MoA describes the power, objective, and operations of the company. The company can undertake those activities written under MOA. It describes the boundaries beyond which the actions of the company cannot exceed. MOA helps the shareholders and creditors interact and deal with the company. So, before moving ahead as a private limited company registration it is important to know the exact business of the company and its limits. The boundary beyond which the company cannot take action and give an overview of the company’s powers and objectives. In the case of a private limited company, an MoA is signed by at least two subscribers. However, in the case of a public limited company, an MoA is signed by seven members....

What is Article of Association (AoA)?

Article of Association specifies the rules and regulations of a company’s internal affairs dealing with its management. It also defines the purpose of a company and outlines the ways in which the company should accomplish its tasks. The tasks include preparation of financial records, and management of financial records. In simple terms, an AoA is a user’s manual of an organization stating its purpose and strategies for the fulfillment of its long and short-term objectives. The main focus of an AoA is to give its readers, information regarding the methods used by the organization to accomplish its daily, quarterly, monthly, and yearly objectives. The document generally consists of the legal name of the company, address of the company, financial provisions of the company, purpose of the formation of the company, provisions related to the shareholders’ meetings, and equity capital of the company,...

Difference between Memorandum of Association (MoA) and Articles of Association (AoA)

Basis of Comparison Memorandum of Association (MoA) Articles of Association (AoA) Meaning A document including every fundamental information essential for the incorporation of an organization. A document including everyrules and regulations governingan organization. Purpose The purpose of MoA is defining objectivesand conditions of an organization and its incorporation. The purpose of AoA is defining rules and regulations governing the internal management of the organization for the accomplishmentof its goals.  Status MoA is subordinate to the Companies Act. AoA is subordinate to MoA. Defines An MoA defines the objectives, powers, andlimits of an organization. An AoA defines the powers, rights,duties, and liabilities that comes with the members of the company. Relationship An MoA connects the outsiders with theorganizations.  An AoA connects the members of anorganization with the company itself. Retrospective Effect An organization cannot amend its MoA. An organization can amend its AoA. Registration MoA is a document compulsory for every organization irrespective of its nature and type. It is mandatory for a private company.However, a public company limited byshares can adopt Table F of the CompaniesAct, 2013.  Compulsion It is mandatory to fill MoA. It is not mandatory to fill AoA. Alteration An organization can alter MoA after passing a SR (Special Resolution) in the Annual General Meeting. Besides, it also require a previous approvalof Company Law Board and Central Government. An organization can alter the Articles after passing SR (Special Resolution) at the AnnualGeneral Meeting (AGM) of the company.  Contents An MoA consists of six clauses. An AoA is drafted by an organization as perits choice....