First Principles of Business Law
Business organisations in Australia

7. Companies

Question 15. Can a company's assets be used to provide security for a debt?

 

 

 

Read the statements below and select the best one.

(a) A company's current assets can be 'charged' with a debt as a form of security, but this means that the use of the assets by the company is restricted until the debt is paid. In particular, the charged assets cannot be disposed of.

(b) A company's current assets can be 'charged' with a debt as a form of security, but in a way that leaves the company free to use the assets, and even dispose of them, before the debt is repaid.

 

 

 

 

 

 

 

 

 

  
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