National Association of Boards of Long Term Care Administrator (NAB) CORE Practice Exam

Which of the following is another term for articles of incorporation?

1. Bylaws

2. Governing rules

3. Charter

4. Constitution

The correct answer is: Charter

The term "articles of incorporation" refers to a formal document that establishes a corporation's existence. This document typically outlines the basic details of the corporation, such as its name, purpose, and the number of shares it is authorized to issue. Another term that is commonly used for articles of incorporation is "charter." The prominence of this terminology stems from the fact that the articles essentially serve as the corporation's charter, granting it the legal rights to operate as a corporation within its jurisdiction. The charter is often filed with a governmental authority to legally recognize the entity. By contrast, while bylaws, governing rules, and constitutions may govern or outline the operational framework of an organization, they do not serve the same foundational legal role as articles of incorporation or a charter. Bylaws typically detail the internal management structure and procedures of the corporation, whereas governing rules might refer to broader regulations under which an organization operates. A constitution, on the other hand, generally refers to a foundational document for a nation or organization that outlines its governing principles and framework, but it is not synonymous with articles of incorporation. Thus, understanding the specific legal implications and functions of these terms helps clarify how "charter" directly correlates with "articles of incorporation."