P2 - 9. Maintenance of records

Question 1

What is the difference between a CREST stock deposit and stock withdrawal?

Answer 1

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

Question 2

Must the statutory records be kept at any specific location?

Answer 2

Yes, at one of the registered office, the SAIL address or, in the case of a private company, on the central register

Question 3

Must the statutory books be books or are other formats permitted?

Answer 3

The statutory records may be held in hard copy or electronically and there is no specific format provided the required information is kept

Question 4

Why must directors provide both a service address and residential address?

Answer 4

The residential address is required in case letters addressed to the service address are returned undelivered then the registrar will send mail to the residential address

Question 5

What is the fee to obtain a copy of the register of members for a company with 500 shareholders?

Answer 5

£65

Question 6

Can a request for a copy of a register specify that the information is to be provided in the form of an Excel
spreadsheet?

Answer 6

No – the request can require delivery in hard or soft copy but not the format of the soft copy

Question 7

Should minutes of all meetings involving directors be minuted?

Answer 7

Yes

Question 8

Can directors’ and members’ minutes be kept together?

Answer 8

Yes, but not recommended as members’ minutes must be available for inspection while the directors’ minutes need not

Question 9

How long must a company keep its original minutes of meetings?

Answer 9

10 years

Question 10

Directors have no statutory right to access board papers, why is this?

Answer 10

They have the right of access to all records and so do not require a specific right to board papers

Question 11

Is there any statutory requirement to retain notices of either directors’ or members’ meetings?

Answer 11

No

Question 12

Companies must keep accounting records with sufficient detail to enable the directors to assess what?

Answer 12

To show and explain transactions, disclose with reasonable accuracy the company’s financial position and enable the directors to prepare accounts and financial statements as required by the Companies Act

Question 13

For how long must companies keep minutes of meetings of their directors and members?

Answer 13

10 years

Question 14

Do a company’s members have to pay a fee to inspect the registers or documents that must be available for
their inspection?

Answer 14

No

Question 15

Why is the register of members important?

Answer 15

Show who owns shares in the company as to be a member requires consent from the individual and details being entered in the register of members

Question 16

Where must statutory registers be kept?

Answer 16

At the registered office or single alternative inspection location or, some of the registers may be held on the central register

Question 17

Name some of the registers are companies required to keep under the CA 2006?

Answer 17

• register of members – CA2006 ss. 114 & 128D;
• register of directors – CA2006 s. 162;
• register of directors’ residential addresses – CA2006 s. 165;
• directors’ service contracts – CA2006 s. 228;
• directors’ indemnities – CA2006 s. 237;
• books containing minutes of directors’ meetings, resolutions in writing of directors and decisions of a sole director – CA2006 s. 248;
• register of secretaries – CA2006 s. 275;

Question 18

Which statutory registers must be kept?

Answer 18

Directors
Directors’ residential addresses
Secretaries
Members

Question 19

Who is a PSC?

Answer 19

person who:
* holds, directly or indirectly, more than 25% of the shares;
* holds, directly or indirectly, more than 25% of the voting rights;

• holds the right, directly or indirectly, to appoint or remove a majority of directors;
• otherwise has 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.

Question 20

What are the three locations for company records?

Answer 20

Registered office
SAIL address (Single Alternative Inspection Location)
Central register

Question 21

Which things are companies required to keep a record of under the CA2006 ss. 355 and 359?

Answer 21

• all resolutions passed by members other than at general meetings;
• minutes of all proceedings of general meetings;
• details of decisions of sole members; and
• class meeting minutes, resolutions and decisions.

Question 22

Director access rights?

Answer 22

No specific statutory right of access to minutes of directors’ meetings

Can exercise the authorities of the company and accordingly have the general right and are entitled to have access to any records they wish to view.

Question 23

Members and class member rights?

Answer 23

No right of access to minutes of meetings of the directors

Right to inspect the members’ and class minutes and records free of charge. If they require copies of any of the records there is a fee payable (CA2006 ss. 358(3), 358(4) and 359).

Question 24

What must the accounting records that each company must keep sufficiently show?

Answer 24

• show and explain company transactions;
• disclose with reasonable accuracy, at any time, the financial position of the company; and
• enable the directors to prepare accounts and financial statements required by the Act (CA2006 ss. 386, 387).