Chapter 5 - COMPANY COMPLIANCE

Question 1

What must companies file with the Registrar / Companies house each year (at a minimum)?

Answer 1

The confirmation statement

The financial statements

Question 2

The creation of a company can be described in what three interchangable ways?

Answer 2

Formation
Incorporation
Registration

Question 3

What are the four types of company available to be incorporated under the act?

Answer 3

Public (plc)
Private Limited (Ltd)
Private Unlimited (Unltd)
Private by Guarantee

Question 4

What is the process whereby a company is incorporated and becomes a legal entity separate from its owners i.e. the members

Answer 4

Registration

Question 5

What must be lodged with registrar to incoporate a company?

Answer 5

Memorandum of Association (shares)
Articles of Association
Form IN01 (name, registered office address, directors and secretary (if using), plus their service addresses)
Name approval (if required)
Registration fee (payment)

Question 6

What three key pieces of info are listed on the certificate of incorporation?

Answer 6

Date of incorporation
Company number
Company type

Question 7

When can a private company commence business?

Answer 7

As soon as it is incorporated

Question 8

What are the two additional requirements for the registration of a public company - in addtion to:

Memorandum of Association (shares)
Articles of Association
Form IN01 (name, registered office address, directors and secretary, plus their service addresses)
Name approval (if required)
Registration fee (payment)

Answer 8

At least two directors and a company secretary

Application for a borrowing certificate (to trade)

Share capital confirmation (shares must be paid up to a min of 25% of nominal value and 100% of any premium)

Question 9

Hard copy, paper filing is available for all statutory forms and documents. What other methods of filing these documents are there?

Answer 9

Online filing
WebFiling
Software filing

Question 10

Is it sufficient to post documents to Companies House prior to the expiry of the appropriate filing period?

Answer 10

No – the requirement is that they must be received, and be acceptable for filing, prior to the deadline

Question 11

Where breaches of legislation in relation to filing / misconduct are found and where the only victims are the company itself or its members, who is liable?

Answer 11

The officers

(Directors, managers, company secretary)

Question 12

Where breaches of legislation in relation to filing / misconduct are found and where the victims are persons other than the company or its members, where does liability rest?

Answer 12

The company

Question 13

What roles usually constitute an officer defined according to the Act (s 1121)

Answer 13

Directors, managers and/or company secretary

Question 14

When was the current version of the UK Corporate Governance Code published?

Answer 14

July 2018

Question 15

What are the five sections of the UK Corporate Governance Code?

Answer 15

Board leadership and company purpose
Division of responsibilities
Composition, succession and evaluation
Audit, Risk and internal control
Remuneration

Question 16

What other Coporate Governance Code is in force in the UK for asset owners and managers - published by the FRC?

Answer 16

The UK Stewardship Code

Question 17

What is the comply or explain principle?

Answer 17

Listed companies should apply the principles of the UK Corporate Governance Code and explain any non-compliances with the provisions of the Code

(recognising that what constitutes best practice might not be appropriate for all companies)

Question 18

The City Code applies to what type of company?

Answer 18

All public companies or companies that have been public in the previous 10 years

Question 19

What is the significance of a share offer being conditional on reaching acceptance of 50%, 75% or 90% of the issued shares?

Answer 19

These thresholds provide different degrees of control:
50% allows the holder to pass all ordinary resolutions and is treated as the holding company for accounting provisions
75% permits the passing of special resolutions as well as ordinary resolutions and gives control to the holder
90% is the level at which dissenters in a takeover can be compulsory acquired under procedures in the Companies Act
2006

Question 20

What common phrase refers to ensuring good culture and corporate governance practices within a company?

Answer 20

Set the tone from the top

(Setting standards of behaviour but also acting in accordance with those standards - all employees have ownership and responsibility)

Question 21

What term refers to a solvent winding up after which the directors have prepared a stat dec that they are of the opinion the company will be able to pay its debts in full within a period not exceeding 12 months from commencement of winding up?

(declaration of solvency)

Answer 21

members’ voluntary winding up

Question 22

How long after ceasing to trade can an application for dissolution of a company be made?

Answer 22

Three months