DUTIES AND RESPONSIBILITIES OF COMPANY DIRECTORS
Summary of Duties and Responsibilities
WHAT ARE THE DIRECTORSí POWERS, DUTIES AND RESPONSIBILITIES?
- The directorsí are responsible for the management of the company.
While their powers can be restricted by the company's articles they can in most cases can do anything that the company can do.
With these powers come responsibilities.
- Since the directorsí can act as and for the company, they must ensure that the company does everything that is is obliged to do by law and that the decisions they make are in the best interests of the company (i.e. the shareholders as a whole).
- Directorsí must :-
- Carry out duties diligently and honestly
- Not carry on the business with intent to defraud creditors or for any fraudulent purpose
- Not knowingly allow the company to trade while insolvent. Directorsí who do so may have to pay for the debts incurred while insolvent
- Not knowingly deceive the shareholders
- Have a regard for the interests of employees in general
- Comply with the requirements of the Companies Acts, such as the preparation and circulation of accounts to the members and submission to Registrar of Companies within the time allowed
RESPONSIBILITIES OF DIRECTORSí
- Responsibilities of directorsí and managers of a Company are to ensure accounting records and other documents related to the transaction and financial position of the Company are properly record and to enable production of true and fair view of profit and loss accounts, balance sheets and other necessary document.
- For company with subsidiaries the directorsí must make sure that the financial year of each of its subsidiaries coincide the holding companyís financial year within two years after any corporation becomes subsidiaries unless application is made to SSM to have the subsidiaries with different financial year.
- At every annual general meeting of the company, the directorsí requested to present before the company once in every calendar year an audited accounts made for the period since the proceeding accounts made up to a date not more than 6 months before the date of the meeting.
- To prepare a report in accordance with a resolution of the directorsí to be attached to every balance sheet laid before the company in general meeting.
- Every director must act honestly at all times and reasonable in performing duties of his office
- Cannot misuse information obtained by virtue of his office to gain advantage for himself directly of indirectly
- Cannot make improper use of any unpublished price sensitive information to gain personal benefit
- To make a disclosure or notice to the shareholding and change thereof
- Must disclose his interest in the contract or proposed contract made by the company
- Must make sure that the minutes book and register of members of the company kept up to date
- Responsible for holding of AGM or EGM
- Registration of certain resolutions and agreements
- Make sure the Annual Return is prepared and lodged to SSM
- Responsible for keeping proper accounting records
- Responsible for circulation of accounts, balance sheet and directorsí report and etc, to members
- Responsible for appointment of first auditors
- Responsible for complying the SSMís instruction to change the company name
- Responsible for complying with the restriction, limitation or prohibition of private company
- Responsible for registration of transfer of shares and issuing of share certificates
- Responsible for maintaining registered office
- Responsible for publication of company name and company number
- Responsible for appointment qualified person as secretaries
- Responsible for in the case of voluntary winding up, it is the duty and responsibilities of the director to make a declaration of solvency
- Responsible for make sure that the payment of dividends are out of profit only
- Responsible for registration of charges