Directors' Responsibilities

4. Duties Under Company Law

Directors are personally responsible for ensuring that the company complies with company law. These duties are usually delegated to the company secretary (if the company has one) or to a director or trusted employee. However, you must ensure that these responsibilities are carried out..

4.1 You must make sure that the statutory returns are filed with the Registrar of Companies on time.

• These include the annual report and accounts, the annual return and notice of changes to directors and secretaries.
• Failure to deliver can result in fines for which you may be personally liable, disqualification or criminal conviction.

4.2 All companies have to file accounts with Companies House.

• In most cases small and medium-sized companies can submit abbreviated accounts. Small companies with a turnover below £6.5 million, or fixed and current assets below £3.26 million, do not need to have their accounts audited and as such are not required to appoint an auditor.
• Directors are required to sign declarations that they have not hidden any material information. If they are later found to have done so, they face fines or imprisonment.

4.3 Most private companies are no longer obliged to hold an AGM, although they must give adequate notice of and hold a general meeting if any director or 5 per cent of members request it.

• Private companies with traded shares must still hold an AGM.
• If you do hold a general meeting, you must give appropriate notice (usually 14 days) and ensure that minutes record all decisions taken. This could protect you if you face legal action later (see 6).

4.4 You are no longer required to circulate copies of the annual accounts for approval at a general meeting. However, members must be sent a copy before they are filed with the Registrar of Companies.

• A director must sign the balance sheet and approve and sign off the directors' report.

4.5 You must ensure that all the company's business stationery carries its name, registered number, country of registration and registered address. These details must also appear on your company website, emails and order forms.