CIPC Compliance: Accounting- and company-records

Published by Peet Pieterse

May 21, 2020

The Companies Act requires a company to maintain certain records. These records must be accessible from the company’s registered office. If they are not accessible from the company’s registered office a notice to this effect must be filed with CIPC.

What documents must be available?

Every company must maintain—

(a) a copy of its Memorandum of Incorporation, and any amendments or alterations to it, and any rules of the company made in terms of section 15(3) to (5);

(b) a record of its directors;

(c) copies of all—

(i) reports presented at an annual general meeting of the company;

(ii) annual financial statements required by the Act; and

(iii) accounting records required by the Act.;

(d) notice and minutes of all shareholders meetings

(e) copies of any written communications sent generally by the company to all holders of any class of the company’s securities; and

(f) minutes of all meetings and resolutions of directors, or directors’ committees, or the audit committee, if any.

 In addition to the requirements above, every profit company must maintain:

(a) a securities register or its equivalent, as required by section 50; and

(b) a record of the details of the company’s auditor/company secretary, if applicable.

How long should these documents be kept?

The general rule applicable is 7 years, but longer periods may apply.

Who can access these records?

There are rules in how the documents can be accessed. All documents above, excluding the accounting records, can be accessed by any shareholder or any additional party as mandated by the company MOI.

Furthermore, access can be sought in accordance with the Public Access to Information Act, Section 32 of the Constitution or any other applicable public regulation.

Application to SMME business

Directors are often unaware of the records that must be kept and that certain parties can have access to these records. Especially share registered (securities register) and the relevant records of the directors are not kept as required. This is often the case where there is only one share holder and director. Directors should bear in mind that the Act requires these registers to be kept, even if there is only one entry.

As part of the new CIPC requirements, directors will need to declare annually that the company adheres to these sections. PPHC Global have the relevant expertise and tools to maintain these registers on behalf of our clients and to provide these in electronic format to them to be kept at their registered office.

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