Company directors have many responsibilities towards the businesses they run, and not just on an operational basis. There are a number of statutory considerations of which new directors must be aware, including the need to hold an annual general meeting of the shareholders.
In some jurisdictions, holding an AGM is not always required. However, it is mandatory in Singapore and ACRA, the country’s companies registry, is trying to bring the 10% of non-complying companies in line. To this end, it has introduced the Directors Compliance Programme (DCP), which covers the full range of company directors’ responsibilities. For example, the course covers statutory duties like holding an AGM and filing annual returns, as well as directors’ fiduciary duties towards the companies they manage.
Attending the DCP is optional for directors, and any company director may attend the $250 course to learn more about how to fulfil their responsibilities. However, where the director concerned is an officer of a company in default (e.g. not up to date with its statutory requirements such as holding an AGM), the regulator may wave the fines or penalties payable if the director(s) attend the DCP. In this way, the scheme is somewhat similar to drivers’ education courses whereby motorists can reduce their penalty for breaking traffic rules.
Penalties for non-compliance
Where directors continually fail to ensure that their company meets its statutory obligations, whether or not they have attended a DCP course, ACRA will prosecute the officers responsible. The penalties can include fines (which may be compounded for repeat offences), disqualification from acting as a director, and even deregistering the company. Ensuring that these simple compliance rules are met is therefore vitally important.
The value of a good company secretary
A qualified and experienced company secretarial provider can ensure that a company’s statutory duties are fulfilled on time and in full, saving your management team from fines and unnecessary administrative overhead. Healy Consultants Group has experience acting as the company secretary for hundreds of companies in Singapore and around the world, and can manage your firm’s legal obligations while you focus on running the business. Visit our website to learn more about our company secretarial services, along with our company formation capabilities and other corporate outsourcing services.
Photo by Camilo Rueda López, available under a Creative Commons Attribution 2.0 Generic (CC BY 2.0) license.