?The Four Requirements for Annual Compliance

It is critical that companies comply with the South African Companies Act, particularly with regard to keeping the company up to date at the Companies and Intellectual Property Commission (CIPC) and maintaining statutory registers. A company that fails to do so may be removed from the register by CIPC, with far-reaching consequences for the directors and the company.

If there are no changes in the company, it must at a minimum adhere to the following four requirements laid out in the Companies Act on an annual basis.

Annual returns to be lodged with CIPC

All companies (including external companies) and close corporations are required by law to lodge their annual returns with CIPC within a certain period every year. An annual return is a statutory return in terms of the Companies and Close Corporations Acts and compliance is therefore compulsory.

Click here to read more on how to lodge the annual returns, what documents need to be submitted and the fees payable to CIPC.

Directors’ Interest in Contracts

We assist companies by keeping or updating the annual or semi-annual disclosure, in advance, by members of the board and prescribed officers of their personal financial interests, as well as those of related persons, regardless of whether such interests give rise to a conflict of interest.

Prior to the commencement of each board meeting, we ensure that the Chairperson of the Board requests all directors and prescribed officers to disclose any personal financial interests relating to any matter on the agenda. Moreover, we ensure that such disclosures are diligently recorded.

This register is always available to the board of directors.

Annual general meeting/ Directors’ meetings

Every company is required to prepare Annual Financial Statements, which must be approved by the Board of directors and adopted by the Shareholders at an Annual General Meeting. There are also additional matters which must be decided on by the shareholders and directors on an annual basis. ?

The Annual General Meeting (AGM) is an important Governance process for the members of an organisation. It can ensure transparency, provide updates and gives members an opportunity to vote on a range of matters. New meeting technology and “virtual attendance” products offer the potential to change the format of the AGM.

Annual review of company registers

The Companies Act 71 of 2008 requires all companies to maintain their records for a period of 7 years and keep their company registers up to date. Rand Corporate Consultants will ensure that company registers are updated and are made available to shareholders, auditors or other interested parties in the manner as prescribed by the Companies Act.