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Small Businesses – Don’t forget the importance of keeping your statutory books.

This is an area that is largely neglected by most small business owners – especially owner ,managed businesses.

However:

  • the Companies Act 2006 does require every company to maintain a set of registers and failing to do so is an offence under the Act that can be punishable by a fine
  • companies are required by law to keep their statutory registers available for inspection
  • The most common registers include a register of members, register of Directors, and other things such as share transfers, company reorganisations etc.
  • A directors minute register should also be kept along with:
  • A list of all shareholder resolutions
  • A list of all Director resolutions

One thing most businesses also do not do especially personal service companies is issue ‘dividend vouchers’ and note an minute the resolution approving the annual or interim dividends.

Statutory books can be used as evidence in legal disputes. In the event of a legal dispute, such as a shareholder dispute or a lawsuit, the statutory books can provide valuable evidence to support the company’s position. The books can be used to prove ownership of shares, demonstrate compliance with regulatory requirements, and show the history of the company’s activities.

Statutory books can be used to demonstrate good corporate governance. Keeping accurate and up-to-date records demonstrates that the company is well-managed and adheres to the highest standards of corporate governance. This can help to build trust and confidence among stakeholders, including investors, customers, and employees.

Disclaimer: Paul Stankiewicz is the owner and principal at Paul Marks & Co Chartered Accountants which is the trading name of Paul Marks Ltd a Limited Company registered in England and Wales (registered number 4487645).This article is designed for the information of readers only and is the opinion of the author only. Readers should not act on any of the information contained in this article without seeking professional advice. Nothing in this article constitutes advice, nor does the transmission, downloading or sending of any information or the Material create any contractual relationship. Links to third party websites are provided as a convenience to the reader, Paul Marks Ltd does not control and is not responsible for any of those websites or their content. Paul Stankiewicz and Paul Marks Ltd accepts no liability or responsibility whatsoever for any loss or damage suffered by any user of the information contained on or accessed through this article or the Material downloaded.