On 6 April 2008 legislation changed such that limited companies are no longer required to appoint a company secretary. However, even though appointing a company secretary is no longer compulsory for limited companies, many still do.
A company’s articles of association can explicitly require a limited company to appoint a company secretary. However, if the company’s directors do not think this is in the best interests of the company, they may seek to remove this provision at any time by passing a special resolution of the company’s shareholders.
Notably, for public companies the requirements are different and section 271 of the CA 2006 states that:
A public company must have a secretary.
What is a company secretary?
A company secretary is responsible for ensuring the smooth administration of the company. They usually assume responsibility for the following important areas:
- compliance with corporate governance and other financial and legal regulations;
- management of shareholder administration and communication; and sometimes
- provision of strategic advice to the company’s board of directors.
If the company does not appoint a company secretary, these important responsibilities must still be met.
Helping you manage your companies, whatever their size
An important part of managing a company is keeping statutory books and Companies House filings up to date.
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If the company does not employ a company secretary, section 270 of the Companies Act 2006 states that these important administrative and compliance tasks become the responsibility of a:
director, or…a person authorised generally or specifically in that behalf by the directors
As a result, many private companies employ a company secretary in order to reduce the administrative and corporate governance burdens otherwise placed on the directors.
What are the core duties of a company secretary?
Whilst company secretary duties are not set out in legislation, responsibilities would usually fall into the following areas:
1 Filing confirmation statements and other company returns
Completing and filing the annual confirmation statement, together with other statutory returns including the annual accounts, directors’ report and auditors’ report where applicable.
2 Maintaining the statutory books
Maintenance of the company’s statutory books and records can be a time-consuming task that is often overlooked. However, failure to keep the statutory registers up to date can incur a penalty of up to £5,000.
3 Arranging directors' and shareholders' meetings
The company secretary would normally be responsible for the arrangement of board meetings, including drafting the agenda, circulating supporting papers and notices and producing the minutes of all meetings. They ensure compliance with any regulatory requirements surrounding the conduct of board meetings, including annual general meetings where applicable. Inform Direct can greatly assist with this role, providing over 300 template board minutes, resolutions and company letters that cover an enormous range of company secretarial transactions, such as our free template first board meeting minutes.
4 Informing Companies House when company details change
Companies House must be informed of any significant changes to the company’s share capital or administration including allotments, appointments and resignations and changes to directors’ addresses and other details.
5 Maintaining the registered office address
The company secretary is usually responsible for maintaining the registered office address as the address for formal communications and for informing Companies House when the address changes. This includes ensuring that the registered office address and other company details are accurate on business stationery, company website, emails and order forms for example.
6 Compliance with legal matters
It is essential that the company secretary has a good working knowledge of the company’s articles of association (the regulations governing the internal management of the company). They should ensure that the company is compliant with the Companies Act 2006 and other legal matters.
7 Security of company documents
8 Communication with shareholders
The company secretary acts as the shareholders’ first point of contact with your company. Circulation of announcements, correspondence regarding dividends, registration of share ownership, transfers and all areas relating to shareholdings normally fall to the company secretary.
9 Signing legal documents
The company secretary may be asked to act as a signatory to legal documents on behalf of the company’s directors. This includes authorising the company’s confirmation statement and signing cheques and other bank documents.
In addition to the core duties detailed above, it is common for company secretaries, particularly in smaller companies, to take on additional administrative tasks. This might include PAYE and payroll, VAT issues, insurance, pensions and dealing with advisers such as accountants and lawyers.
As can be seen therefore, appointing a company secretary can be extremely helpful to the effective running of the company. As an important officer of the company, when a company secretary is appointed, or removed, or their details are changed, this must be reported to Companies House – in the same way that similar changes to the role of director would also be reported.
How does Inform Direct simplify the role of company secretary?
Inform Direct is the perfect tool for anyone carrying out the role of company secretary – even if you have no qualifications or experience in the role. Our online records management software has been designed with the complete novice in mind and will help you keep on top of many of the tasks outlined above, including:
- Changes to company details: easily update shareholder, director and company details using step by step easy to follow flows.
- Submitting the correct forms: working out which paper forms to submit to Companies House after a change to company, director or shareholder details can be confusing to all but the expert company secretary. Our software works it all out for you. Once you have confirmed the change it will automatically file the correct electronic form, ensuring timely compliance and avoiding the hassle of completing paper forms.
- Confirmation statement filing: Inform Direct almost completely removes the burden of filing your confirmation statement. It reminds you as the filing deadline approaches and when you are ready automatically presents your company details in the correct format. Any reportable changes you have made during the year have been saved so there is no time wasted re-entering information. Simply check and confirm the details are correct before submitting your confirmation statement to Companies House electronically. The whole process takes moments.
- Updating statutory registers: your statutory registers are automatically updated as you make changes to company details, saving you a separate task. Always up to date, the company’s statutory registers are available online for inspection, or you could email them in response to enquiries – saving the traditional journey to inspect paper registers held at a company registered office.
- Provision of template documents: Inform Direct can provide you with over 300 fully compliant documents that support an enormous range of company secretarial transactions. We provide template board minutes, resolutions, company letters, forms, certificates and reports, including free resources like our template Consent to Act as officer forms and template stock transfer forms. When you complete a transaction in Inform Direct, our clever software will suggest documents that may be required and pre-populate them with the details you have already entered.
Whether you are undertaking the role yourself or are looking to appoint a company secretary, you can register with Inform Direct to access our free company records software. You’ll find it an invaluable tool to help keep on top of the myriad of tasks that fall to the company secretary.
Inform Direct makes it quick and easy to maintain statutory registers, manage company records and submit filings to Companies House at the touch of a button.
A previous version of this article was originally published on 30 April 2014.