The Accounting and Corporate Regulatory Authority (ACRA) specifies that any business established in Singapore must complete the legal mandate of selecting an administrator within six months of the date the company was incorporated. This need must be met before the firm may start doing business.
In accordance with Section 171 of the Companies Act, the company secretary must have a place of residence in Singapore and will serve as the principal officer responsible for various administrative and reporting responsibilities. These primary purposes include, but are not limited to, the filing of the annual business reports, membership registrations, the transferring of shares, and the record and filing of board resolutions, among other things.
Even though the Companies Act lays out the legislative structure that the secretary and the directors are required to function, it is the duty of the secretary to assist the top executives in making certain that the business conforms with all the requirements now in place.
This article focuses on the legislative necessity for the hiring of a corporate secretary as well as the many jobs and responsibilities that come along with being a secretary.
Key Appointment Provisions
The selection of a new corporate secretary will be the responsibility of the organization’s board of directors.
The applicant who is eventually chosen for the position must, in accordance with Section 171 of the Companies Act,
- A natural person
- A resident of Singapore
Therefore, the secretary must be a natural person who resides permanently in Singapore. This covers both nationals and permanent residents of Singapore as well as those who have an EntrePass.
Any competent individual who has a SingPass and who lives in Singapore permanently is suitable to be appointed as the corporate secretary of a private company. However, a corporation with only one director or shareholder cannot be the company’s secretary.
Additionally, the provision indicates that a resolution voted on and approved by the company directors may be used to appoint the company secretary. However, the board of directors will not choose someone for the post of company secretary if that person is subject to a debarment order from the Registrar on the appointment date.
In addition, this part of the article emphasizes that the position of company secretary should never, under any circumstances, remain vacant for more than six months.
Qualifications of a Company Secretary
Companies based in Singapore must follow certain legal guidelines when selecting a company secretary. In accordance with the Singapore Companies Act, a person must fulfill at least one of the following conditions to be eligible for appointment as a company secretary in Singapore:
- Be familiar with Singapore’s rules and regulations governing companies. To be considered for the position of secretary in a public business, the applicant must have between three and five years of relevant work experience, at the very least. According to ACRA, this type of person may either be a competent person or a registered filling agency.
- Be a certified public accountant registered under the Accountants Act.
- Satisfy the standards set forth by the Legal Profession Act.
- Be a registered member of a recognized accounting organization, such as the Singapore Association of the Institute of Chartered Secretaries and Administrators, Certified Public Accountants of Singapore, the Association of International Accountants, or the Institute of Company Accountants (ICA).
Roles and Responsibilities of the Company Secretary
The corporate secretary in Singapore is given several roles and obligations in accordance with the Company law.
Company secretaries often wear several crowns inside an organization due to the breadth of their responsibilities. The following is a list that describes the many different responsibilities that cooperation secretaries in Singapore hold.
Corporate secretaries are responsible for various administrative responsibilities inside the organization. Some of the administrative responsibilities include making sure that the firm files its yearly returns timely, that it follows the due dates that have been established, and that it abides by any requirements that are relevant to ACRA. Company secretaries’ responsibilities further extends to managing the company’s share register and ensuring its proper upkeep. Therefore, the company directors can devote more time and energy to other aspects of the business.
The corporate secretaries of a corporation are an essential component of the firm’s human resources because of the professional knowledge they possess about Singapore’s legal and compliance frameworks.
First, they determine which set of actions are necessary and communicate these to the directors so that they can make a prudent decision.
Second, they make sure that the changes are processed in a manner that is in accordance with the laws of Singapore. The company constitution may be amended, the company name could be changed, the secretary could be appointed or resign, and additional special resolutions might be passed.
Finally, the upper management depends on the secretary for assistance in business operations. This includes but not limited to the admission of new directors for board resolution matters in accordance with the Companies Act and updates in the business constitution.
Corporate secretaries are responsible for constantly acting in good faith and serving in the best interests of the company. For example, they shall:
- Not divulge information of the company that might result in conflict of interest
- Not act outside the scope of power granted to corporate secretaries as per the Company act
- Not make any covert profit for themselves in the process of performing their duties.
Updating and filing with ACRA
The following responsibilities are within the scope of the corporate secretary:
- Timely filing of the company’s yearly returns.
- Directors’ information is updated whenever a change occurs, such as a new director’s appointment, a resignation, or a death.
- Filing share transfers and allotments
- Filing changes when there are amendments to the company name or company’s constitution, to name a few.
Maintenance and update of statutory registers
It is the responsibility of the company secretary to ensure that the registers listed below are always kept up to date. The following are the more common ones:
- Register of secretaries.
- Register of directors.
- Register of members.
- Register of the allotment of shares
- Maintains the company’s yearly accounting book and the minutes book for annual and extraordinary general meetings (AGM and EGM)
Organization of board meetings and AGMs
The corporate secretary shall perform the following:
- Administer, prepare and attend board meetings.
- Prepare the board resolutions.
- Keep a record of the minutes of company meetings and board resolutions. They are kept as part of the official records of the firm.
- Keep a record of the reminders for the filing deadlines.
Other responsibilities (depending on the company’s needs and not limited to the following)
- Ensure that the corporate seal is properly managed.
- Update directors on relevant changes in corporate regulations.
- Maintain a registered office – Every business incorporated in Singapore must have a registered address. The address must be included on all of the legal documentations that apply to the firm and must be registered with ACRA.
The secretary’s duties are clearly stated under the Singapore Company Law; however additional responsibilities may be assigned under the terms of a certain employment agreement. In addition, the tasks may differ from one secretary to the other depending on each person’s professional credentials and level of expertise.
If a company secretary breaches their fiduciary obligations in violation of the Companies Act or the company’s constitution, it might lead to serious repercussions for the business and its directors, such as imprisonment, fines, or even the dismissal of the secretary from their position.
Resignation of a Company Secretary
The following are the steps that need to be done by the firm if the company secretary decides to resign from their position.
- It is required that the outgoing corporate secretary submit a letter of resignation to the board of directors.
- The board must pass a board resolution approving the resignation of the company secretary.
- The company must file a cessation of company secretary to ACRA within 14 days of the resignation.
Removal of a Company Secretary from Office
There are situations when the company may decide to dismiss the company secretary from their position. In most cases, the organization will ask the secretary to step down from their position, but if the secretary refuses to comply, the organization may choose to remove him from his office by coercion.
- A resolution from the board of directors is often required to remove the secretary from office. Following the resolution, the company must file a cessation of company secretary to ACRA within 14 days.
Importance of Company Secretaries
From consulting responsibilities to ensuring that the firm remains compliant, the work of a corporate secretary is essential to the organization’s ongoing success. Since errors made in this job might have significant financial repercussions, it is essential to search for qualified and trustworthy candidates before selecting one. If the board of directors is careful in their selection of a company secretary, they will be able to guarantee that their business complies with the rules and regulations imposed by Singapore’s regulatory organizations such as ACRA.
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