Do you understand your obligations when it comes to statutory books and records? For businesses in the UK, this is an aspect of your company’s recordkeeping that shouldn’t be overlooked. Find out everything you need to know about managing the statutory books of a company, right here.
Understanding statutory books
The statutory books of a company consist of several important registers and documents that need to be maintained under the Companies Act 2006. Put simply, they provide evidence of your firm’s current constitution and history. Your company’s statutory books and registers will consist of the following documents related to shareholders and directors:
Register of members
Register of directors
Register of secretaries
Register of directors’ usual residential addresses
Register of people with significant control
Minutes of directors’ and shareholders’ meetings and resolutions
Furthermore, your business may also retain registers of allotments and transfers and a register of mortgages and charges. You’ll need to ensure that all of these statutory books and registers are kept up to date, and if any significant changes occur at your company, they will need to be amended to reflect that.
The register of members explained
One of the essential elements of your business’s statutory books is the register of members, so it’s important to understand it in a little greater depth. Essentially, the register of members is a definitive record of the company’s shareholders, as well as everyone who is entitled to exercise all of the legal rights associated with your business’s shares. If you choose to sell the company, the register of members will be investigated thoroughly.
Errors in your firm’s statutory books and registers
There are many different ways that errors can be introduced into the statutory books of a company. Some of the most common types of errors include:
Company records not matching Companies House records following shareholder movements or changes in the nominal value of shares.
Company entered onto the register of members following a share buyback, when the shares could potentially be cancelled immediately.
Shareholders entered on the register of members prior to a stock transfer form being duly stamped for the payment of stamp duty.
Bottom line: there are lots of different errors that can creep into your statutory books and registers. So, what happens if your firm makes a mistake and you breach the statutory books requirements?
Statutory books requirements
As we mentioned, you are obligated to keep your company’s statutory books and records updated at all times. If you fail to keep your company’s statutory registers up to date, then your business may be subject to fines. While the severity of the fine is likely to vary on a case by case basis, the following penalties may apply:
Late filing of accounts can lead to fines of £100-5,000.
Failure to submit accounts can lead to fines of £5,000.
Failure to file a confirmation statement can lead to fines of £5,000.
Failure to hold an AGM can lead to fines of £5,000.
Failure to notify any changes of officers can lead to fines of £5,000.
It’s important to note that adherence to statutory books requirements is necessary for the fulfilment of your company directors’ statutory duties. As such, breaches can result in more significant fines for directors themselves.
Who can see your statutory books and records?
Anyone is entitled to view copies of your statutory books. They must be available to inspect either at your company’s registered office, Companies House online, or another address. However, you should remember that if you keep your statutory books and records at Companies House, some confidential information will be made available to the public.
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