Chapter 9: Companies - Recordkeeping, Filing, and Disclosure

Question 1

What obligation comes with the benefit of limited liability status for companies and shareholders?

Answer 1

An obligation of transparency as regards certain company information and its financial affairs.

Certain information is required to be made publicly available to enable anyone interested in investing in the company to find out relevant information to facilitate their investment decision.

Question 2

What registers must private companies keep?

Answer 2

The Companies Act 2006 requires private companies to keep the following registers:
i. register of members,
ii. register of directors,
iii. register of secretaries,
iv. register of charges against the company’s assets, and
v. a register of people with significant control.

Question 3

What is required of the registers of a private company?

Answer 3

The registers are required to be kept available for inspection by members (for free) or the general public (for a fee) at the company’s registered office (or in the case of the register of director or members, at Companies House if the company so elects).

Question 4

How long must minutes from all general shareholders’ meeting be kept for?

Answer 4

Must be kept for at least 10 years + made available for the shareholders to inspect free of charge.

Question 5

How long must directors’ service contracts be kept?

Answer 5

Copies of directors’ service contracts must be kept for at least 1 year beyond each director’s service + made available for members to inspect.

Question 6

What is an annual confirmation statement?

Answer 6

Company is required to submit an annual confirmation statement to CH.

Statement confirms, annually, that the information held by Companies House for the company is up to date.

Question 7

When must a company deliver a statement of capital with the confirmation statement?

Answer 7

A company with share capital must deliver a statement of capital with the confirmation statement if there has been a change since the last confirmation statement was delivered.

Question 8

What is required re annual confirmation statement if no changes have taken place at the company?

Answer 8

A company must make a ‘no change’ confirmation statement even if there have not been any changes during the review period.

Question 9

What is the review period covered by a company’s first confirmation statement?

Answer 9

The review period covered by a company’s first confirmation statement begins on the date of incorporation and ends 12 months later.

Question 10

What is the effect of failing to file the confirmation statement?

Answer 10

It is a criminal offence to fail to file the confirmation statement within 14 days of the end of the company’s review period.

Question 11

When must charges against a company’s assets be registered?

Answer 11

Charges against the company’s assets must be filed at Companies House within 21 days of creation.

Question 12

What does the Companies Act 2006 require re accounts?

Answer 12

The Companies Act 2006 requires the preparation and filing of accounts with Companies House, with more relaxed requirements as to what is required to be filed for small companies.

Question 13

When must private companies send copies of their accounts to Companies House?

Answer 13

Private companies must send copies of their accounts to Companies House no later than 9 months after the relevant accounting period.

Question 14

When must public companies send copies of their accounts to Companies House?

Answer 14

The filing period is 6 months after the relevant accounting reference period.

Question 15

What is the effect of filing accounts are Companies House?

Answer 15

Once filed, the accounts are a matter of public record + are searchable on the Companies House website.

Question 16

What director approval requirements are there for company accounts?

Answer 16

The directors must approve the accounts, verifying their belief that they are satisfied that the accounts give a true + fair view of the assets, liabilities, financial position, and profit/loss of the company

Question 16

What are the contents of the accounts?

Answer 16

1. Company’s registration number,
2. Company’s nature (public/private and limited by shares/guarantee).
3. Indicate the part of the UK in which the company is registered,
4. A balance sheet as of the last day of the financial year, and
5. A statement of profit and losses

Each must give a ‘true and fair view’ of the company for the financial year.

Question 17

When may an audit report be required?

Answer 17

Except in small companies, accounts must be reviewed by an independent auditor.

Question 18

What is the effect of failing to file the accounts on time?

Answer 18

Failure to file accounts on time will incur financial penalties, can lead to possible criminal sanctions + could result in disqualification of directors

Question 19

Who must file an annual directors’ report?

Answer 19

Medium + large companies (companies with more than 50 employees or turnover of about £10 million or more) must file an annual directors’ report

Question 20

What does an annual directors’ report do?

Answer 20

This report names the directors + states the amount (if any) that the directors recommend should be paid by way of dividend

Question 21

Who must file an annual strategic report?

Answer 21

Medium + large companies

Question 22

What is the purpose of an annual strategic report?

Answer 22

Purpose of the strategic report is to inform members of the company + help them assess how the directors have performed their duty to promote the success of the company.

Question 23

What does an annual strategic report do?

Answer 23

This repot provides a balanced and comprehensive view of the development and performance of the company’s business.

Question 24

When must Companies House be notified of changes within a company?

Answer 24

When there are changes with respect to:
i. a company’s board of directors,
ii. capital structure, or
iii. articles

Usually within 14 or 15 days.

Failure by the directors to make the appropriate filing is an offence.

Question 24

What updating is required upon the appointment or termination of a director or officer?

Answer 24

Requires updating the locally kept register + filing a notice of change with Companies House within 14 days of the change.

A notice of change in residential information also must be filed within 14 days.

Question 24

When must an ordinary resolution be filed at Companies House?

Answer 24

An ordinary resolution giving directors the power to allot new shares must be filed with Companies House within 15 days of approval.

Question 25

What must be sent to Companies House along with a copy of the resolution to reduce share capital?

Answer 25

The resolution must also be accompanied by a statement of solvency

Question 26

When must special resolutions be filed at Companies House?

Answer 26

Special resolutions that have been approved must be filed with Companies House within 15 days of approval, including a special resolution to reduce share capital.

Question 27

When must Companies house be notified of the issuance of new shares?

Answer 27

CH must be notified of the issuance of new shares within 1 month (in addition to filing any shareholder resolution giving directors the power to allot new shares).

Question 28

When will a change of address of the company’s registered office be effective?

Answer 28

Will not be effective until filed with Companies House.

Question 29

What internal changes will be required following a change of registered office?

Answer 29

Change company documentation, letterhead, website etc.

Question 30

What must be filed if a company change their accounting reference date?

Answer 30

File a Change of Accounting Reference Date form at Companies House

Question 31

What internal updates will be needed when appointing new directors?

Answer 31

Update register of directors & directors’ residential addresses

Question 32

What internal updates will be needed when removing a director?

Answer 32

Update the Register of Directors and Directors’ Residential Addresses

Question 33

What filing requirements are needed when removing a director?

Answer 33

File a Termination of Appointment of Director form at Companies House within 14 days

Question 34

What internal updates are needed for transfer of shares?

Answer 34

Update the Register of Members,
Issue new share certificate within 2 months

Question 35

What internal updates are needed for the issuance of shares?

Answer 35

Update the Register of Members + new share certificate within 2 months

Question 36

What filing requirements are there for the issuance of shares?

Answer 36

File a Return of Allotment of Shares form at Companies House within 1 month, and
Any necessary shareholders’ resolutions within 15 days

Question 37

What must be filed if the articles are changed?

Answer 37

Special resolution + new articles must be filed at Companies House within 15 days

Question 38

What must be filed to change the company’s registered name?

Answer 38

1. Special resolution,
2. Change Your Company’s Name By Resolution form, and
3. Fee

Question 39

What must a company disclose on its company letterhead?

Answer 39

1. Registered name,
2. Part of the UK in which the company is registered,
3. The company’s registered number, and
4. The address of the company’s registered office.
5. If a company chooses to display the name of any director on its letterhead, it must include the name of every director on the letterhead.

Question 40

What must a partnership disclose on its letterhead?

Answer 40

1. The name of the partnership,
2. The name of each member of the partnership,
3. The partnership’s business address

Question 41

What must a sole trader disclose on their letterhead?

Answer 41

1. Their business name,
2. Their real name if ti is different than the business name, and
3. Their business address