• The Corporate Secretary
• The Auditor and Audit Committee
• Penalties associated with non-compliance of the Companies’ Act
The Corporate Secretary
Every State Enterprise must have a Corporate Secretary. The Secretary is not the personal secretary of the Chairman of the Board, but is responsible to the Board of Directors. This is a Statutory appointment.
He is an Officer of the Company and as such, is personally accountable for all his actions, particularly in regard to his statutory duties, which, if not observed, will render him liable to all the penalties prescribed by the Companies Act.
The Corporate Secretary is the link between the Board and the Chief Executive Officer and /or the staff, thus ensuring the efficient administration of the Company.
The principal duties of the Corporate Secretary are:
• Prepare the Agenda for Board Meetings.
• Attend all Board Meetings, make notes and keep Minutes of the Meetings.
• Communicate the decisions of the Board to the Chief Executive and Staff.
• Maintain a Register of Members and their shareholding.
• Maintain a Register of Directors’ interests and a Register of charges where appropriate.
• File all the Statutory Returns as required by the Companies’ Act.
• Prepare and send Notices for all shareholders’ meetings (Annual and Extra-ordinary).
• Maintain a separate Minute Book for Shareholders’ meetings and makes them available for inspection by shareholders.
The Corporate Secretary keeps the Board members informed of their legal responsibilities and is the company’s named representative on legal documents.
The Corporate Secretary is appointed by the Board of Directors. They must ensure that the Secretary has the requisite knowledge and competencies to discharge his/her responsibilities effectively. (Reference Section 63 of the Act) The above list is not exhaustive as the Board can assign other duties to the Corporate Secretary.
The Auditor and the Audit Committee
The Auditor of the Company is appointed at every General Meeting of the Company (except where other provisions are made in the Articles or in Statutory Corporations). He holds office for that financial year until the conclusion of the next Annual General Meeting. It is therefore important and necessary for companies to have their accounts completed, audited and approved shortly after the close of the financial year (say within fourmonths or as the Minister directs).
The Audit Committee
Every State Enterprise must have an Audit Committee. The Audit Committee reviews the financial statements of the company before such financial statements are approved by the Board and reports its findings to the Board of Directors.
The Auditor is entitled “to receive notice of every meeting of the audit committee and, at the expense of the company, to attend and be heard thereat; and, if so requested by a member of the Audit Committee, shall attend every meeting of the committee held during the term of office of the auditor”.
The appointment (or removal) of the Auditor to the company is spelt out fully in the Act, including the competencies and qualifications of such company or individual. (Reference Sections 157 to 174 of the Act)
Offences and Penalties under the Companies Act
Sections 507 – 524 detail the offences and penalties associated with contravention of and non-compliance with the Companies Act, 1995.
These range from the payment of fines in the court to payment of fines as well as prison terms.
In short, Directors and Officers of the Company, if found guilty of breaches of the Act, can find themselves liable before the Courts of the land for such breaches and can be penalised accordingly.
The Act, therefore, is required reading for all members of Boards, and a useful reference document for the conduct of the business of Boards.
The Integrity Commission urges all Board members and other senior officers to familiarise themselves with its contents.