Applicability of Secretarial Standards - mandatory under section 118 of Companies Act 2013
Clarification on Applicability of Secretarial Standards Dear Professional Colleagues
The Secretarial Standards on Meetings of the Board of Directors (SS-1) and Secretarial Standards on General Meetings (SS-2) (together referred to as the Secretarial Standards), as approved by the Central Government, have been issued by the Institute of Company Secretaries of India (ICSI) under the provisions of Section 118(10) of the Companies Act, 2013 (the Act), vide ICSI Notification No. 1 (SS) of 2015 dated April 23rd, 2015 and published in the Gazette of India Extraordinary Part III - Section 4. These Secretarial Standards shall come into force w.e.f. 1st July 2015.
The Secretarial Audit Report issued pursuant to the provisions of Section 204 (1) of the Act read with Rule 9(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, shall be in Form No. MR-3 (Secretarial Audit Report) and shall inter-alia mention about the examination conducted by the Secretarial Auditor w.r.t. the compliance by a Company under the applicable clauses of the Secretarial Standards.
Considering the date of effectiveness of Secretarial Standards, the Institute clarifies the following:
1. These Secretarial Standards (SS-1 and SS-2) shall apply to Board Meetings and General Meetings, in respect of which Notices are issued on or after 1st July, 2015.
Other Secretarial Standards issued by ICSI in line with the provisions of the Companies Act, 1956 are under revision to align with the provisions of the Companies Act, 2013. Accordingly, such other Secretarial Standards are not applicable presently.
Companies Act 2013 :Duties of Company Secretary defined, role of CS in service and practice enhanced
1) to provide to the directors of the company, collectively and individually, such guidance as they may require, with regard to their duties, responsibilities and powers;
2) to convene and attend Board, committee and general meetings, and maintain the minutes of these meetings;
3) To obtain approvals from the Board, general meetings, the Government and such other authorities as required under the provisions of the Act.
4) To represent before various regulators, Tribunal and other authorities under the Act in connection with discharge of various functions under the Act;
5) to assist the Board in the conduct of the affairs of the company;
6) to assist and advise the Board in ensuring good corporate governance and in complying with the corporate governance requirements and best practices; and
7) to discharge such other duties as may be assigned by the Board from time to time
8) Such other duties as have been prescribed under the Act and Rules.
SECRETARIAL AUDIT
Companies Act 2013 has given a prominent role for company secretary in practice as well as company secretary in employment.
FUNCTIONS OF COMPANY SECRETARY
The functions of the company secretary shall include,—
(a) to report to the Board about compliance with the provisions of this Act, the rules made thereunder and other laws applicable to the company;
(b) to ensure that the company complies with the applicable secretarial standards;
Explanation.—For the purpose of this section, the expression "secretarial standards" means secretarial standards issued by the Institute of Company Secretaries of India constituted under section 3 of the Company Secretaries Act, 1980 and approved by the Central Government.
INCORPORATION OF COMPANY:
We find mention Company Secretaries in Practice first time after definitions in Section 7 of the Act, which deals with incorporation of companies. Company Secretary in Practice has to compete here with other professionals. For incorporation of a company there is a requirement that a declaration is to be given by company secretary practice, which is engage in formation of the company that all the requirements of Act and rules related to registration, matter precedent and incidental thereto.
Any person making false declaration shall be liable for action under Section 447.
ANNUAL RETURN:
Section 92 of the Act contains provisions about Annual Return of the Companies. Every company shall prepare annual return containing details as mentioned in Sub – section (1) of this section.; like registered office, principle activities, shareholding pattern, members, debenture – holders, Promoters, Directors, Key Managerial persons, meetings, managerial remuneration, penalty punishment and other matters as prescribed. This Annual Return shall be signed by a director and company secretary of the company. Where there is no company secretary, it shall be signed by Company Secretary in Practice.
In case of listed companies and certain other companies determined on the basis of paid – up capital and turnover; this annual return shall be certified by company secretary. The company secretary shall certify that annual return discloses all facts correctly, adequately and in compliance with all provision of the Companies Act.
In any case, Company Secretary in Practice certify Annual Return otherwise than in conformity with requirement of the section, it shall be punishable with fine of Fifty thousand to Five Lakh rupees.
MINUTES OF APPOINTMENT OF COMPANY SECRETARY IN PRACTICE:
Sub – section (8) of Section 118 has an interesting reading. It say that where the minutes have been kept in accordance with sub-section (1) then, the meeting shall be deemed to have been duly called and held, and all proceedings thereat to have duly taken place, and the resolutions passed by postal ballot to have been duly passed and in particular, all appointments of directors, key managerial personnel, auditors or company secretary in practice, shall be deemed to be valid. Even though, there is no clarity, whether appointment of Company Secretary in Practice will be take place by Board of Directors or Members in General Meeting, but certainly in some meeting as per the above, by implication.
REPORT OF BOARD OF DIRECTORS:
Clause (f) to Sub – section (3) of Section 134 makes it clear that report by Board of Directors shall include an explanations or comments by the Board on every qualification, reservation or adverse remark or disclaimer made by the company secretary in practice in his secretarial audit report. This clearly specifies importance of secretarial audit report in eye of legislature. Now, this is on Company Secretary Community to meet these expectations of legislature and corporate community. Hope, Secretarial Audit report by Company Secretaries will win confidence among stakeholders including investors.
POWER AND DUTIES OF AUDITORS:
Sub – section (14) of Section 143 make it clear that company secretary in practice conducting secretarial audit under section 204 shall have same power and duties as auditor of the company.
Sub – section (1) emphasis on power by saying that every auditor of a company shall have a right of access at all times to the books of account and vouchers of the company, whether kept at the registered office of the company or at any other place and shall be entitled to require from the officers of the company such information and explanation as he may consider necessary for the performance of his duties as auditor.
Sub – section (12) cast very important duty; if an auditor, Company Secretary in practice or Cost Accountant of a company, in the course of the performance of his duties has reason to believe that an offence involving fraud is being or has been committed against the company by officers or employees of the company, he shall immediately report the matter to the Central Government within such time and in such manner as may be prescribed.
This section, in fact, turns auditors into whistle – blowers, which was really a role for them intended by law – makers.
SECRETARIAL AUDIT:
Every listed company and a company belonging to other class of companies as may be prescribed shall annex with its Board's report made a secretarial audit report, given by a company secretary in practice, in such form as may be prescribed. It shall be the duty of the company to give all assistance and facilities to the company secretary in practice, for auditing the secretarial and related records of the company. The Board of Directors, in their report shall explain in full any qualification or observation or other remarks made by the company secretary in practice in his report. If a company or any officer of the company or the company secretary in practice contravenes the provisions of this section, the company, every officer of the company or the company secretary in practice, who is in default, shall be punishable with fine which shall not be less than one lakh rupees but which may extend to five lakh rupees.
SEARCH AND SEIZURE:
Where, upon information in his possession or otherwise, the Registrar or inspector has reasonable ground to believe that the books and papers of a company, or relating to the key managerial personnel or any director or auditor or company secretary in practice are likely to be destroyed, mutilated, altered, falsified or secreted, he may, after obtaining an order from the Special Court for the seizure of such books and papers,— (a) enter, with such assistance as may be required, and search, the place or places where such books or papers are kept; and (b) seize such books and papers as he considers necessary after allowing the company to take copies of, or extracts from, such books or papers at its cost.
This is clear that Company Secretary in practice is considered an important functionary related to company and record at his possession is being considered important evidence. At this point, I request all fellow company secretaries, please maintain proper record at their offices other piecemeal record may cause problem and make them party for unwanted situations.
MERGER AND AMALGAMATION:
Certainly company secretaries have important role as consultants in merger and amalgamation but here under sub – section (7) of Section 232 provide an opportunity after order of approval for merger and amalgamation. Every company in relation to which the order is made shall, until the completion of the scheme, file a statement in such form and within such time as may be prescribed with the Registrar every year duly certified by a chartered accountant or a cost accountant or a company secretary in practice indicating whether the scheme is being complied with in accordance with the orders of the Tribunal or not. Please note that any contravention of this section attract penalty of one lakh rupees. Company secretary has to give an statement that the scheme is being complied.
QUALIFICATION FOR TECHNICAL MEMBER OF TRIBUNAL:
Among other qualifications, practice as a company secretary for at least fifteen years or being a person of proven ability, integrity and standing having special knowledge and experience, of not less than fifteen years, in law, industrial finance, industrial management or administration, industrial reconstruction, investment, accountancy, labour matters, or such other disciplines related to management, conduct of affairs, revival, rehabilitation and winding up of companies is a qualification for appointment as technical member of the National Company Law Tribunal.
MANAGERIAL REMUNERATION:
Section III of Schedule V of the Company Act deals with Remuneration payable by companies having no profit or inadequate profit without Central Government approval in certain special circumstances. Proviso to this section list some conditions to comply by the company before approving managerial remuneration in such circumstances. Two important conditions are:
(i) the auditor or Company Secretary of the company or where the company has not appointed a Secretary, a Secretary in whole-time practice, certifies that all secured creditors and term lenders have stated in writing that they have no objection for the appointment of the managerial person as well as the quantum of remuneration and such certificate is filed along with the return as prescribed under sub-section (4) of section 196
(ii) the auditor or Company Secretary or where the company has not appointed a secretary, a secretary in whole-time practice certifies that there is no default on payments to any creditors, and all dues to deposit holders are being settled on time.
Further, Part III of the Schedule V make a condition from the auditor or the Secretary of the company or where the company is not required to appointed a Secretary, a Secretary in whole-time practice that the requirement of this Schedule have been complied with and such certificate shall be incorporated in the return filed with the Registrar.
Thus, present companies Act, 2012 have many opportunities for Company Secretaries in Practice. They have to grab these opportunities and win confidence of stakeholders, legislature and corporate world. Hope, this confidence will not be broken and make this profession a just another useless employment providing opportunity at the cost of industries.
EXPERT
Company Secretaries has scope of practice as Company Secretaries in practice as such as well as Expert under the Act.
Sub – section (38) of Section 2 of the Act define an expert, as an engineer, a valuer, a chartered accountant, a company secretary, a cost accountant and any other person who has the power or authority to issue a certificate in pursuance of any law for the time being in force.
Certificates to be issued by practising company secretary
MGT 8 to be filed along with Annual Return
Deligence Report issued by practicing company secretary to Lenders
Certificates to be issued by practising company secretary
MGT 8 to be filed along with Annual Return
Deligence Report issued by practicing company secretary to Lenders
DILIGENCE REPORT
To
The Deputy General Manager,
State Bank of Hyderabad,
Hyderabad.
Dear Sir,
I have examined the registers, records, books and papers of BG Tollways Limited (the Company), having its registered office at 5th Floor, Progressive Towers, Khairatabad, Hyderabad – 500 004, as required to be maintained under the Companies Act, 1956 (the Act) and the rules made there under, the provisions of various statues, wherever applicable, the provisions contained in the Memorandum and Articles of Association of the Company as well as the provisions contained in the Listing Agreement/s, if any, entered into by the Company with the recognized stock exchange/s, as may be applicable for the half year ended on September 30, 2011. In my opinion and to the best of my information and according to the examination carried out by us and explanations furnished to me by the Company, its officers and agents, I report that in respect of the aforesaid period:
1. The management of the Company is carried out by the Board of Directors comprising the following persons and the Board was duly constituted:
No.
|
Name
|
Designation
|
Date of Appointment/
Reappointment
|
1
|
B. Seenaiah
|
Director
|
21/01/2010
|
2
|
T. Dayakar
|
Director
|
21/01/2010
|
3
|
U. Jayakodi
|
Director
|
21/01/2010
|
During the period under review, there were no changes in the Board of Directors.
2. The shareholding pattern of the Company as on September 30, 2011 was as under:
No.
|
Name
|
No. of
Shares |
% of
stake
|
1
|
Promoters Holding (A)
|
12,47,506
|
100
|
2
|
Foreign Companies’ Holding (B)
|
NIL
|
NIL
|
3
|
Indian Companies’ Holding (C)
|
NIL
|
NIL
|
TOTAL [A +B+ C]
|
12,47,506
|
100.00
|
During the period under review there were no changes in the shareholding pattern.
3. The Company has not altered any of the provisions of the Memorandum and Articles of Association of the Company during the period under review.
4. The Company has entered into transactions with business entities in which directors of the Company were interested as detailed in Annexure 1 – Related Party transactions are enclosed.
5. The Company, during the period under review, has not advanced loans, given guarantees and provided securities to its directors and /or persons or firms or companies in which directors are interested.
6. The Company has not made any loans and investments; or given guarantees or provided securities to other business entities.
7. The amount borrowed by the Company from its directors, members, financial institutions, banks and others were within the borrowing limits of the Company. Such borrowings were made by the Company in compliance with applicable laws. The breakup of the Company’s domestic borrowings was as detailed in Annexure 2 - Outstanding Loans as on 30.09.2011 are enclosed.
8. The Company has not defaulted in the repayment of public deposits, unsecured loans, debentures, facilities granted by banks, financial institutions and non – banking financial companies.
9. The Company has during the period under review not created, modified or satisfied charges on the assets of the Company.
10. Investments in wholly owned Subsidiaries and/or Joint Ventures abroad made by the Company are NIL.
11. Principal value of the Forex exposure and Overseas Borrowings of the Company as on date is NIL.
12. Company has not issued, offered and allotted any securities during the period under review.
13. The Company has insured all its secured assets.
14. The Company has complied with the terms and conditions, set forth by the lending bank/financial institution at the time of availing any facility and also during the currency of the facility.
15. The Company has not declared and paid any dividends to its shareholders during the period under review.
16. The Company has insured fully all its assets – Not Applicable
17. The name of the Company and / or any of its Directors does not appear in the Defaulters’ List of Reserve Bank of India.
18. The name of the Company and / or any of its Directors does not appear in the Specific Approval List of Export Credit Guarantee Corporation.
19. The Company has paid all its statutory dues and satisfactory arrangements had been made for arrears of any such dues.
20. The funds borrowed from banks / financial institutions have been used by the Company for the purpose for which they were borrowed.
21. The Company has complied with the provisions stipulated in Section 372A of the Companies Act, 1956 in respect of its Inter Corporate loans and investments.
22. It has been observed from the Reports of the Directors and the Auditors that the Company has complied with the applicable Accounting Standards issued by the Institute of Chartered Accountants in India.
23. There is no unpaid dividend and hence credit to the Investor Education and Protection Fund does not arise.
24. Prosecutions initiated against or show cause notices received by the Company for alleged defaults/offences under various statutory provisions and also fines and penalties imposed on the Company and/or any other action initiated against the Company and/or its directors in such cases are NIL.
25. The Company is NOT a listed company and hence the provisions of Listing Agreement are not applicable
26. The Company has deposited within the stipulated time both Employees’ and Employers’ contribution to Provident Fund with the prescribed authorities – Not Applicable.
Signature
Place: Hyderabad
Date:
XBRL makes the data readable, with the help of two documents:
SECRETARIAL COMPLIANCE CERTIFICATE for a Pvt Ltd Co
To
The Members
NEW ENERGY PRIVATE LIMITED
SECUNDERABAD
I have examined the registers, records, books and papers of M/s. NEW ENERGY PRIVATE LIMITED (The company) as required to be maintained under the Companies Act, 1956, (the Act) and the rules made there under and also the provisions contained in the Memorandum and Articles of Association of the Company for the period ended on 31st March, 2014 In my opinion and to the best of my information and according to the examinations carried out by me and explanations furnished to me by the Company, its officers and agents, I certify that in respect of the aforesaid financial year:
1. The Company has kept and maintained all registers as stated in Annexure ‘A’ to this certificate, as per the provisions and the rules made there under and all entries therein have been duly recorded.
2. The Company has duly filed the forms and returns as stated in Annexure ‘B’ to this certificate, with the Registrar of Companies, Regional Director, Central Government, Company Law board or other authorities within the time prescribed under the Act and the rules made there under.
3. The Company being a private limited company, has the minimum prescribed paid up capital and its maximum number of members during the said financial year was less than the Maximum Number of Members of Fifty (50) excluding its present and past employees and the company during the year under scrutiny:
ii) Has not invited public to subscribe for its shares or debentures and
iii) Has not invited or accepted any deposits from persons other than its members, directors or relatives.
4. The Board of Directors duly met Thirteen (13) times 30th June 2013, 30th July 2013, 26th August 2013, 12th September 2013, 21st September 2013, 30th September 2013, 11th October 2013, 21st October 2013, 25th November 2013, 20th December 2013, 26th December 2013, 17th January 2014 and 22nd March 2014 in respect of which meetings proper notices were given and proceedings were properly recorded and signed including the circular resolution passed in the Minutes Book maintained for the purpose.
5. The Company has not closed its Registrar of Members during the financial year.
6. The Annual General Meeting for the financial year ended on 31st March 2013 was held on 30th September 2013 after giving due notice to the members of the company and the resolutions passed there at were duly recorded in the Minutes Book maintained for the purpose.
7. No Extra Ordinary General Meeting was held during the financial year under review.
8. The Company being a private company, section 295 of the Act is not applicable.
9. The Company has duly complied with the provisions of the Section 297 of the Act in respect of contracts specified in that section.
10. The Company has made necessary entries in the register maintained under section 301 of the Act.
11. As there were no instances falling within the purview of section 314 of the Act, the Company has not obtained any approvals from the Board of Directors, members or central Government.
12. The company has not issued any duplicate share certificates during the financial year.
13. The Company has:
(i) There was no allotment/transfer/transmission of any securities during the financial year under review.
(ii) The Company has not deposited any amount in a Separate Bank Account as no dividend was declared during the financial year.
(iii) The Company was not required to post warrants for dividends to any member of the company as no dividend was declared during the financial year.
(iv) The Company has not declared any dividend, issued any debentures and has not accepted deposits, the question of transfer of dividend in the unpaid dividend account, application money due for refund, matured deposits, matured debentures and the interest accrued thereon which have remained unclaimed or unpaid for a period of seven years to Investor Education and Protection Fund does not arise.
(v) The Company has duly complied with the requirement of Section 217 of the Act.
14. The Board of Directors of the Company is duly constituted. There was no appointment of additional directors, alternate directors and directors to fill casual vacancy during the financial year.
15. The Company being Private Company, the provisions of Section 269 of the Act with regard to appointment of Managing Director/Whole-time director/ Manager are not applicable.
16. The Company has not appointed any sole selling agents during the financial year.
17. The Company was not required to obtain any approvals of the Company Law Board, Regional Director, Registrar and / or such authorities prescribed under the various provisions of the Act during the financial year.
18. The directors have disclosed their interest in other firms / companies to the Board of Directors pursuant to the provisions of the Act and the rules made there under.
19. The Company has not issued any shares, debentures or any other securities during the financial year under review.
20. The Company has not bought back any shares during the financial year.
21. The Company has not issued any preference shares / debentures and hence the question of redemption of preference shares / debentures does not arise during the financial year under review.
22. There were no transactions necessitating the Company to keep in abeyance the rights to dividend, rights shares and bonus shares pending registration of transfer of shares.
23. The Company being a private Company has not invited/accepted any deposits from public within the meaning of Section 58A and the Rules framed there under except from its members, Directors or their relatives and the requisite declaration has been obtained from them.
24. The company, being a private limited company, the borrowings made during the financial year does not attract the provisions of section 293(1) (d) of the Act. Further the complied with the provisions of Section 180 (1) (c) of Companies Act 2013.
25. The Company being a Private Limited Company, the provisions of Section 372A of the Act is not applicable.
26. The Company has not altered the provisions of the Memorandum with respect to situation of the Company’s registered office from one state to another during the year under scrutiny.
27. The Company has not altered the provisions of the Memorandum with respect to the objects of the Company during the year under scrutiny.
28. The Company has not altered the provisions of the Memorandum with respect to the name of the Company during the year under scrutiny.
29. The Company has not altered the provisions of the Memorandum with respect to Share Capital of the Company during the year under scrutiny.
30. The Company has not altered the provisions of Articles of Association during the year under scrutiny.
31. There was/were no prosecution initiated against or show cause notices received by the company and no fines or penalties or any other punishment was imposed on the company during the financial year, for offences under the Act.
32. The Company has not received any money as security from its employees during the financial year.
33. The Company has deposited both employee’s and employer’s contribution to Provident fund with the concerned authorities in compliance with the provisions of Section 418 of the Act.
Place: Hyderabad V. XXXXXXXXXXX
Date: Company Secretary in Practice
XBRL- EXTENSIBLE BUSINESS REPORTING LANGUAGE
XBRL is a standardized communication language in electronic form to express, report or file a financial statements by a Companies. XBRL is only a method of presentation or reporting. It does not attempt to make any changes in the content to be reported. The idea behind XBRL is simple. Instead of treating financial information as a block of text – as in a standard internet page or a printed document – it provides an identifying label (tag) for each individual line item of data. This data then becomes computer readable.
Benefits:
XBRL offers major benefits at all stages of business reporting and analysis such as: cost savings, greater efficiency, improved accuracy, reliability to all those involved in supplying or using financial data.
So If you wonna measure your company’s business process and achievement effectively. Voluntarily Codify it and get measure it with your or our company’s expert team and Measure it. Always remember – IF YOU CAN’T MEASURE ; YOU CAN’T ACHIEVE AND REACH YOUR DESTINATION.
Statutory Requirement – Applicability of XBRL Filing with Registrars:
Below mentioned class of companies shall file their financial statements and other documents under section 137 of the Companies Act, 2013 with the Registrar in e-form AOC-4 XBRL:
- All public companies listed in a stock exchange in India and their Indian subsidiaries.
- All companies with a turnover of Rs 100 crores or more
- All companies with a paid up capital of Rs 5 crores or more
(other than banking companies, insurance companies, power companies and NBFCs), Graphical Representation as mentioned below for better understanding.
Major Change:
In XBRL Rules 2015 first three categories of applicability of XBRL was same. However, there was one more category i.e. “all companies which were hitherto covered under the Companies (Filing of Documents and Forms in Extensible Business Reporting Language) Rules, 2011”.
Therefore a Company which was required to file financial statement in XBRL under previous rules but not falling under applicability limit as of now. Such Companies are exempted for filing of financial statement in XBRL under Amendment Rules, 2017.
Query : A Company voluntary prepared financial statement into XBRL for some financial year. Whether such Company required preparing the financial statement into XBRL in future also?
Opinion – As Per the applicability of filing of financial statement into XBRL Rules, 2017, it is not mandatory for such companies to file financial statement into XBRL in future. It can file the normal AOC-4 form. Only Companies falling under XBRL Amendment Rules, 2017 required to file financial statement into XBRL.
List of required documents need to be process XBRL for MCA : The following components of Annual reports need to be filed in XBRL Format:
- Balance Sheet
- Profit and Loss Statement
- Cash Flow Statement
- Schedules related to Balance Sheet and Profit and Loss Statement
- Notes to Accounts
- Statement pursuant to Section 212 of the Companies Act, 1956 relating to subsidiaries
- Audit and Annual Report
What if – If you fails to file the copy of the Financial Statements to ROC within prescribed time limit
: Penalty Provisions :
Company: Fine 1,000.00 for everyday till default continue but max. 10,00,000.00
Directors: Fine Min. 1 Lakhs to Max. 5 Lakhs – OR – Imprisonment – Max. 6 months
CFO : Same as in the case of Directors
Authorised Director : Same as in the case of Directors
How does XBRL work ?
- Taxonomy
- Instance Document.
Taxonomy contains description and classification of business & financial terms, while the instance document is made up of the actual facts and figures. Taxonomy and Instance document together make up the XBRL documents.
Steps involved in XBRL to file statements with MCA:
- Mapping
- Tagging
- Review, verify and validate the XBRL instance document
- Scrutiny through tool
- Creating a XBRL docs and filling as an attachment in ROC Form.
What is the Role of
the Company Secretary in Board Meeting
The role of
the company secretary is to act as the chief advisor
on corporate governance to the board, so the role of the company
secretary at board meetings goes well beyond administrative
operations and taking the board minutes.
Duties
of the Company Secretary and Preparing the Meeting
Tact and sensitivity are
key to a company secretary's success in this aspect of the job. That's because
it involves dealing with directors, the chair and top management – all of these
must be brought together in a civil discussion so that decisions can be made.
Preparing the focus of
the board meeting is a collaboration between the company secretary and the
chair. While the chair will run the board meeting, the company secretary may
advise the board on governance issues that derive from the meeting focus, or
enter into debates with a corporate governance perspective.
It is the company
secretaries duty to oversees the process of structuring board meetings, helping
to determine the focus and purpose of those meetings. In this, the company
secretary works closely with the chair to ensure that the most critical and
timely issues are under discussion at the meeting. A board meeting has to cover
a lot of ground; it would be difficult to achieve all that is necessary in an
unstructured, informal chat.
Any compliance
requirements that must be addressed at the time of the meeting will be added to
the agenda by the company secretary, who will also include any new legal or regulatory
changes of which the board should be made aware.
It then falls to
the company secretary to
discuss the meeting focus with all the other board members, and to take into
consideration their ideas while preparing the final agenda. This document will
then be shared among all the board members for any further updates or issues,
as well as with the administrator, who will manage the practical details, see
that the necessary equipment is made available, etc.
The company secretary
should also ensure that board members have all the materials they
need for preparation for this specific meeting, including, of course, board
papers, but also other types of background.
Helps Manage the Board
Meeting
The chair conducts the
meeting, and the company secretary helps in various ways to manage it.
As a company
secretary represent the interests of the company, its management and its
investors, he must be prepared to intervene in board
discussions when some aspect of these interests seems to be neglected or
ignored.
To do this requires emotional
intelligence and attention to detail — a company secretary who is too intrusive
or who hasn't made the necessary preparation will soon find that directors have
little patience for his/her interventions.
The company secretary
must see that all matters needing to be discussed are discussed, and that
enough time is allowed to reach each decision with the appropriate level of
concentration. The company secretary should also intervene with background
points should they be ignored or neglected.
With all this, the
company secretary must take notes to prepare the board meeting minutes
expertly. Minutes that carefully reflect board meetings are a legal obligation. The company
secretary should take care to include all relevant material, and
especially all decisions, as well as a clear list of votes in each case. An
electronic board portal makes taking the minutes easy and
secure.
Must Finalise the Board
Meeting
When the meeting is over,
the company secretary should discuss with individual board members any issues
that still need to be resolved, and possibly consider them for the agenda of
the next meeting. If necessary or desirable, it is useful to arrange informal
discussion in between board meetings so that ongoing issues can be moved
forward. It may also be necessary to arrange discussions between board members
and management, or board members and external advisors.
Then it will be time to
write up the board minutes – it's best to do this as soon as possible after the
meetings so that all the details are fresh in mind. Then the draft minutes
should be shared with the chair for approval, and the chair's signature should
be obtained for the approved board minutes from the previous meeting.
Often, at board meetings,
there are action points decided which are the responsibility of a specific
board member, a committee chair or management. The company secretary is
responsible for following up on these, sending reminders when necessary and
putting the outcomes up for discussion at the next meeting.
All of
the company secretary's tasks can be facilitated by with Modern
Governance tools included in high-quality company secretarial software: from taking the minutes
to arranging meetings with board members, to storing relevant documents and
data.