Explain What Is Meant By An Annual General Meeting, Annual Report And Accounts and Annual Return

Earlier article describe the difference between the Articles Of Association and Memorandum Of Articles.

Below briefly describe in some commonly used-terms in both private and public limited company namely:-company’s annual general meeting, annual report and accounts and annual return:

Annual General Meeting ( abbreviation AGM)

  • Held only by limited company ( not in sole proprietorship or partnership)
  • Is a YEARLY meeting to which all shareholders are invited
  • The directors present the financial statements for the financial year which has just ended.
  • The financial statements are approved at this meeting
  • Some of the agenda specified in an AGM are:-
  • Approval of director fees
  • Appointment of auditors
  • Any vacancies on the board of directors are filled and others
Annual Reports and Accounts:

  • Is a summary of the company’s activities which must be sent to shareholders in both private and public limited companies each year
  • This report must contain at least the minimum of information required by the Companies Act
  • A copy must be filed with the Registrar of Companies
  • Some of the contents include:
  • Directors’ report on the previous year’s financial results
  • The balance sheet as at the end of the trading year
  • The Income statement
  • The Cash flow statement
  • Auditor’s report where external auditor also report on whether the financial statements show a true and fair view of the company’s financial position.
Annual Return:

  • This is the document sent to the Registrar of Companies ANNUALLY
  • This return gives particulars of directors and members plus a copy of the last balance sheet and income statement.

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