Maintenance of records Flashcards
Name 5 statutory registers that must be kept
The registers must be kept up-to-date and details of changes notified to who?
Where must they be kept?
In what format must they be kept?
What must the statutory records be? (3)
- Register of members
- Register of directors
- Register of Directors’ residential addresses
- Register of Secretaries (same details required as ROD but no nationality, occupation, or residential address)
- Register of PSCs
Companies House within 14 days
At the RO or SAIL address, or, in the case of a private company, on the central register
No specified format in law = may be kept in hard copy (bound or loose-leaf books), soft copy (on computer), or using specialised system
A. secure
B. confidential
C. capable of being made available for inspection and for copies to be taken
What are the 8 details that must be kept for each current and former director in the register of directors?
Why must directors provide both a service address and residential address?
- Name (and former name)
- Service address
- County of residency
- Nationality
- Business occupation (if any)
- Date of birth
- Date of appointment
- Date of termination (if relevant)
In case letters addressed to the service address are returned undelivered = the registrar will the send mail to the residential address
What 6 things must the register of members contain?
Who should be registered as members?
What happens if documentation is received to register shares in
the name of a trust or partnership?
When can information about a former member be removed from the register of members?
S.113 CA2006:
1. name
2. address
3. A statement of shares held distinguishing each share by its number and class (if the company has more than one class);
4. A statement of the amount paid;
5. The date on which the person was registered as a member; and
6. The date at which the person ceased to be a member
(any acquisition or disposal of shares)
Only individuals or legal entities (Scottish partnerships are legal entities but English partnerships aren’t!)
Documentation should be rejected = shares should be registered in the names of 2 or more of the partners or trustees (join holders usually restricted to 4)
10 years after the date on which they ceased to be a member
What is CREST?
What does it enable?
Which companies is it required for?
Where a company’s shares have been admitted to CREST, what happens to the register of members?
What is the difference between a CREST stock deposit and stock withdrawal?
= the electronic settlement system used by UK regulated markets
CREST enables digital settlement of securities, including delivery of the shares being traded
Only for those companies with their shares listed on a public market
Split into 2:
* CREST responsible for an uncertificated, dematerialised, electronic sub-register
* Company or its share registrar are responsible for the certified register
A stock deposit is the movement of shares from the certificated part of the share register to the uncertificated, dematerialised part of the register
A stock withdrawal is the opposite of a stock deposit
Who is a Person with Significant Control?
What are the 3 types of ownership structures whose details must be entered into a company’s PSC register?
What are the 8 details for an individual person that must be recorded on the PSC register? (Excluding date cease to be a member)
Which companies are exempt from keeping a PSC register and why?
Schedule 1A, Part 1 CA2006 = a person who:
1. Holds directly or indirectly more than 25% of the shares;
- Holds directly or indirectly more than 25% of the voting rights;
- Holds directly or indirectly the right to appoint or remove a majority of directors;
- Otherwise have the right to exercise, or actually exercises, significant influence or control over the company; or
- Has the right to exercise, or actually exercises, significant influence or control over the activities of a trust or firm which is not a legal person, the trustees or members of which would satisfy any of the four conditions above
Individuals, registerable relevant legal entities, and other registerable persons (e.g. sole traders)
A. date individual became a registerable person
B. full name
C. country of residence
D. nationality
E. service address
F. residential address
G. date of birth
H. nature of control over company
Listed companies (but not their subsidiaries) because they and their shareholders are under the DTR 5 obligation to disclose interests in excess of 3%
What is the registered office address?
Where must the registered office be situated?
What is a SAIL address?
Which forms are required for a SAIL address?
What is the central register?
How can companies wishing to take advantage of the central register keep their register(s) on the central register?
What is the disadvantage of the central register and how can this be avoided?
S.86 CA2006 = all companies must have an address at which legal documents can be served (given on Form IN01 and changes made on Form AD01)
In the company’s country of registration
Any company may elect to hold one or more of its registers at a Single Alternative Inspection Location (can only be 1 alternative location and has to be in same country as RO)
Form AD02 = to notify where the SAIL address is
Form AD03 = to notify which registers and records and held at the SAIL address
Private companies can elect to hold ROM, ROD, RODRA, ROS, & PSCR on the central register maintained by the Registrar of Companies at Companies House
= giving notice to the Registrar in respect of each register they wish to hold on the central register (can give notice to opt out too)
Disadvantage = directors’ residential addresses are shown on public record = any person can apply to have residential information suppressed by opting in and providing an alternative address (cannot be used if registered office is a residential address)
Who can inspect the statutory registers?
What are the 2 ways someone can inspect the registers?
What is due notice? (Ltd only)
Requests to inspect the ROM and PSC register (by either method) must be accompanied by a statement - What 3 things must the statement contain?
If the company does not believe that the request to inspect the registers is being made for a proper purpose, what can it do?
How is the fee payable for members and non-members to be provided with a copy of the ROM calculated?
Members can inspect all registers free of charge, anyone else may be required to pay a fee of £3.50 per hour (or part thereof) during which the register(s) is/are inspected (RODRA is not available for public inspection)
- In person
A. Companies must make records available between 9am-5pm for plc and 9am-3pm for private (BUT private = only for 2 hours during these times and person wishing to inspect must give due notice) every working day - By requesting copies be sent to them (in hard copy or soft copy but cannot specify format of soft copy)
Ltd members must give due notice to inspect:
A. at least 2 working days if notice given at GM
B. 10 working days in all other cases
Requests must be accompanied by a statement:
i. identifying person requesting information
ii. purpose for which they require the information; and
iii. whether information will be disclosed to another and if so, the name and address of other person and purposes they will use the information
Apply to court (within 5 days of a request being made) for an order to not comply with the request
On a sliding scale:
First 5 entities = £1 each
Next 95 entities = £30
Next 900 = £30
Next 99,000 = £30
Remained of register = £30
What is the minute book? / what are companies required to do?
Where should the minute book be kept and who can inspect it?
What other records are companies required to keep? (4)
Where should there records be kept and who can inspect them?
What format must the minute book and other records be stored in?
How long must the minute book and other records be kept?
Why should minutes of GMs generally be kept separate from board minutes?
S.248 CA2006 = all companies must maintain minutes of all formal director meetings or meetings intended to approve a directors’ resolution (unclear on board committee meetings, but good practice to record minutes)
Any director (and the auditor) and each company can decide where to keep it
S.355 and 359 CA2006:
1. minutes of GMs
2. all resolutions passed by members other than at GM
3. details of decisions of sole members; and
4. class meeting minutes, resolution, and decisions
Members and auditor (free of charge) so must be kept available for inspection at RO or SAIL address
No requirement other than secure format, but should generally be numbered consecutively = hard copy (bound or loose-leaf books), or soft copy (on computer)
For 10 years
Members have a right to inspect minutes of GMs but not of board meetings
Directors have no statutory right to access board papers, why is this?
Why should board papers be issued sufficiently in advance of a board meeting?
What is usually considered sufficient notice?
For communications with members, why do companies need to ensure that their members’ address information is kept up to date?
What are the consequences of not keeping the address information up to date?
They have the right of access to all records and so do not require a specific right to board papers
= to allow directors the opportunity to read and consider the information and seek additional clarification if required
1 week prior to meeting
To ensure members’ communications are sent to the correct address - particularly import for notices of GMs
The legality of a meeting where sufficient notice is not sent or sent to an address company knows or ought to know is wrong, can be called into question
If the meeting has been convened incorrectly due to improper notice, any resolutions approved by that meeting may be declared void (Bradman v Trinity Estates plc [1989])
(Accidental omission to send a notice does not invalidate the meeting)
Each company must keep adequate accounting records that are sufficient to do what 3 things?
Name 3 accounting records that are likely to be kept as a minimum to meet these requirements.
Where must the accounting records be kept and for how long?
Who has the right to inspect the accounting records?
CA2006 = keep adequate accounting records that are sufficient to:
A. show and explain company transactions
B. disclose with reasonable accuracy, at any time, the financial position of the company; and
C. enable the directors to prepare accounting and financial statements required by CA2006
- All items of income and expenditure
- assets purchased by Company
- contractual liabilities e.g. bank borrowing
S.388 CA2006 = either at RO or at such other place as directors think appropriate and for a minimum of 3 years (private) or 6 years (plc)
Directors and auditor have a general right (members have no right)
What are 3 other corporate records that companies must retain in addition to the minutes and accounting records?
- Directors’ service contracts
S.228 CA2006 = must be kept available for member inspection, free of charge, at all times at RO or SAIL address (and kept for 12 months following contract termination) - Directors’ indemnity insurance policy (if company maintains one)
S.237 CA2006 = must be kept available for member inspection, free of charge, at all times at RO or SAIL address (and kept for 12 months following expiry) - Contracts for purchase of own shares
S.702 CA2006 = copy of purchase contract must be kept available for member inspection (and public inspection for plc), free of charge, at RO or SAIL address for at least 10 years
REGISTER OF CHARGERS
Prior to 6 April 2013, what were companies required to keep?
Is this still relevant?
What is the amended procedure post 6 April 2013? (2)
In practice what does this mean?
What is the consequence of failing to comply?
Where must copies of charges (and any amendments) and instruments creating a charge be kept?
A register of charges
Yes = company must maintain a register of chargers for any charges created prior to 6 April 2013 = update if charge released or any changes etc.
- companies are not required to maintain a register for charges after 6 April 2013
- Mortgage register maintained on central registrar kept at CH = details of charges created must be promptly registered at CH and CH notified when charges are released or changed
Companies may have a split register = older charge information kept by the company and new charge information kept at CH
Regardless of when charge was created, it is an offence not to register charges at CH
S.859 = RO or SAIL address
OVERSEAS BRANCH REGISTER
When may a branch register be established?
Which form is required to notify CH of the registers location?
CA2006 = Where a company trades overseas and has a substantial number of shareholders in that overseas country
AD06
Which Act allows private companies to keep their registers on the public central register held by Companies House?
Can the registered office address, SAIL address, and what type of company records are kept there be private?
Small Business Enterprise and Employment Act 2015
No = CA2006 = a person can request a company to confirm its RO, SAIL, and type of company records kept there
Company must respond with the information within 5 business day
