Annual General Meetings in Singapore
In Singapore, annual meetings are mandatory and are to be held in compliance with the Companies Act of Singapore, which is issued by the Accounting and Corporate Regulatory Authority (ACRA). Failure to hold an annual meeting will see shareholders and its directors be held accountable. ACRA can impose penalties to be settled in court, which could throw a wrench into a company's business operations.
Hence, it is imperative that annual meetings are scheduled on time for participants to know in advance. Proxies can be sent in their place in the event they are unable to attend. This way, the annual meeting will push through with enough people and a number of voters.
1. What is An Annual General Meeting (AGM)?
An AGM is a mandatory meeting organized by a company to convey its business health to shareholders. Shareholders will be served with financial statements, where they can raise questions pertaining to the company’s financial performance and status and pass important decisions for the company’s well-being.
In Singapore, it is mandatory as per the Company Act for every newly developed company to conduct its first AGM within 18 months of incorporation. Subsequent AGMs are to be conducted once every economic year. Following meetings are to be held at least 15 months from preceding AGMs. This is a requirement of every local and international company registered in Singapore to strictly pay attention to. The company must submit a well-written notice 14 days prior to the AGM meeting.
2. How to Hold An AGM?
A legally valid quorum must be formed prior to the AGM, consisting of a few persons who will be present during the meeting. In case the Memorandum and articles association do highlight this quorum, any two members/proxies at the meeting are free to join. The AGM is to be directed by the meeting chairman and the board of directors’ chairman, who have to ensure that the meeting runs smoothly. Below is a summary of how to hold an AGM meeting.
Quorum formation and meeting
Meeting conducted by chairman
Laying the years account
Discussion of matters in the AGM’S notice
Meeting minutes include passed resolutions, declared interest transactions and officers’ appointments which are to be signed by the chairman. Meeting minutes are to be recorded in the minutes’ book.
3. FYE, AGMs, and Annual Returns
Importance of the FYE
Financial year-end is stipulated to be at the end of the accounting period and happens every 12 months. FYE deadlines are set for filings required for AGMs. Even if you dispense AGMs, you must prepare documents for annual returns. You must not worry because it is the job of the company secretary alone.
Every company with an exemption from conducting AGMs should send a copy to all shareholders within 5 months of the FYE. Depending on what type of company you own, you must either submit it to ACRA with the Annual Return or not.
If there are less than 20 shareholders and none is a corporation, you are not obliged to send a financial statement to ACRA. Businesses that other businesses partially own must turn in their financial statements, including insolvent companies.
These are documents indicating the company’s status and financial health. Filing can only take place after all shareholders sign the resolution to approve the financial statements. Under ACRA regulations, you are required to lodge it within 7 months of the FYE.
4. Dispensation of Annual General Meeting
In accordance with section 175(A) of the Singapore Companies Act, Private limited companies can choose not to conduct an AGM only when shareholders and members have unanimously passed the written resolution. So long as the decision in regard to the dispensation of the AGM has been passed, all set matters for discussion during the AGM are combatted by distributing written resolutions to every member.
The following obligations are to be followed after dispensation:
Preparation of company’s financial statements at the end of every financial year.
Sending members and shareholders updated financial statements and other relevant documents, alongside the Directors’ Report and statement.
Passing across AGM associated, written resolutions passed by the shareholders.
5. In Case Your Company Needs an Extension
In the event your company is unable to hold an AGM within a specific time-frame, you may file an application for an Extension of Time (EOT) at ACRA. The company’s officer or firm can file an application for EOT. As with all other transactions with ACRA, this application is also sent through the Bizfile portal. ACRA will grant a maximum of 2 months extension, at an application cost of S$200.
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