6.1 LO1 Test your knowledge of various aspects of limited liability companies. Match the terms in 1–10 in the first list with the corresponding definitions A–J in the second list.

1 Share 2 Ltd 3 Pty Ltd 4 Equity 5 Dividend 6 Reserves 7 Preference shares 8 Rights issue 9 Bonus issue 10 Audit A Shares distributed by the company to shareholders ‘for free’
B Independent examination of a company’s finances C Signifies a public limited company D Shares given preference when dividends are distributed E Includes profits built up over time within the company F Signifies a private limited company G Opportunity for shareholders to buy more shares H The sum of all the reserves and ordinary share capital I Part of reserves distributed to shareholders J One unit of a company’s ownership