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Question
Explain four advantages of Depository system to the Company.
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Solution
- Up-to-date Information: The up-to-date information about investors is provided by the depository.
- Reduction in costs and efforts: Costs, efforts, and time involved in printing and distribution of certificates in cases of new issues, bonuses, transfers, etc. are saved.
- Better Investor - Company Relationships: The complaints arising out of the loss of certificates, signature differences, long lapses of time in executing requests, etc. are substantially reduced. It leads to better communication with investors and increased goodwill for the company.
- International Investment: Under Depository System, better and quicker services can be provided and this attracts investments from abroad.
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RELATED QUESTIONS
Select the correct answer from the options given below and rewrite the statement.
______ is the institute which facilitates electronic holding of securities.
Depository Act was passed in __________.
Match the pairs.
| Group ‘A' | Group ‘B' |
| a) Bad Delivery | 1) 1956 |
| b) Depository Act | 2) A 12 digit number/code. |
| c) ISIN | 3) Connects Government and Bank. |
| d) Depository participant | 4) Second Depository in India. |
| e) CDSL | 5) The Issuer Company. |
| f) Depository | 6) Problem faced in physical mode. |
| g) Beneficial owner | 7) A 10 digit number/code. |
| 8) Connects Depository and Investor. | |
| 9) First Depository in the world. | |
| 10) Coustodian of securities in electronic form. | |
| 11) Problem faced in electronic mode. | |
| 12) 1996 | |
| 13) Government Organisation. | |
| 14) The Investor. |
State whether the following statement is true or false.
Depository system began in the USA for the first time in the world.
State whether the following statement is true or false.
Depository system is very similar to banking system.
State whether the following statement is true or false.
DP is an agent of Depository.
Find the odd one.
Find the odd one.
Complete the sentence.
First Depository of the world started in the year ______.
Select the correct option from the bracket.
| Group ‘A' | Group ‘B' |
| a) Dematerialization | 1) ____________ |
| b) ____________ | 2) DP |
| c) First depository of world | 3) ____________ |
| d) CDSL | 4) ____________ |
(1999, Agent of Depository, Germany, physical to electronic)
Select the Suitable word for the following.
Dematerialization ____________.
Answer in one sentence.
Give examples of action termed as corporate action.
Correct the underlined word and rewrite the following sentence.
Electronic mode of holding securities is risky.
Explain the following term/concept.
Dematerialisation
Justify the following statement.
The electronic holding of securities is safer than physical holding.
Justify the following statement.
The depository system results in reduced time, cost, and efforts.
Explain the advantages of the Depository System to the companies.
State benefits of the depository to Investors.
