Explain the significance of a prospectus

cbse
formsoforganisations

#1

The prospectus of a company serves the following purposes
(i) Prospectus contains the summary of the company’s past history and present operation.
(ii) It reflects the future programmes and prospects of the company.
(iii) It serves as an invitation to the public to subscribe to the shares and debentures of the company.
(iv) It provides a legal document of the terms and conditions on which shares and debentures have been issued.
(v) It identifies the persons who can be held responsible for any untrue statements made in it.