Explanation:

The company may before declaration of dividend in any financial year transfer such part of its profits for that financial year to Reserve as the Board of Directors thinks appropriate. This is a paradigm shift from the Companies Act, 1956.Now there is no compulsion for transfer a fixed percentage of Profit to Reserve. It enables the Company to have more fund for dividend.

There is no such provision regarding this. So there is no need of special authority is not needed either in the memorandum or in the articles