Explain the circumstances under which a company may issue bonus shares

 Circumstances in which a company may issue bonus shares:
 There must be authority in the articles.
 It must be authorised by an ordinary resolution of members in general meeting.
 It must be recommended by the board and approved by the general meeting.
 Bonus issues can be financed by reserves or by share premium account.
 Its nominal share capital must be sufficient.

A return of allotment must be delivered to the Registrar within one month of allotment.
 Must be issued in the proportion prescribed by the articles.

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