Signs you need a secretary

Signs you need a secretary

Typically, a company secretary is employed to decrease the workload of directors by assisting with day-to-day management duties and responsibilities. Outlining your personal and business requirements should help you determine whether you need a secretary.

The laws on secretaries

If you’re a newly founded business, it is important to determine which section of the Companies Act you fall under before you even consider hiring a secretary. Since 6 April 2008, unless there is a definite need in your articles of association, the Companies Act 2006 no longer requires private limited companies to employ a secretary by law (CA 2006 section 270). The decision for hiring a secretary rests directly a private limited company’s shoulders – a choice many still choose to uptake in practice.

This differs from public companies, which, in accordance with CA 2006 section 271require a secretary’. For public limited companies, the secretary must meet one or more of the following qualifications:

  • Have held the office role of company secretary for a public company for at least three out of the five years immediately before their appointment as secretary;
  • Be a barrister, advocate or solicitor;
  • Be a member of certain bodies, for example, the Institute of Chartered Accountants in England and Wales.

As for private limited companies, there are very few restrictions defining who can and cannot be employed as your secretary, with the only limitations being:

  • Company auditors cannot also act as secretary;
  • The employee must not be an undischarged bankrupt unless provided leave by a court.

Other than these, an individual, partnership and even the company director are allowed to act as secretary. Although the secretary of a public limited company does not require any formal qualifications, it is essential they are capable and knowledgeable enough to take on a huge level of responsibility.

The responsibilities of a secretary

Arranging Meetings

If you’re struggling to tactically arrange, prepare for important meetings then employing a secretary will ensure all attendees are informed and all necessary information is provided; allowing your meetings to run smoothly.

A company secretary is responsible for arranging board meetings; this also includes drafting a schedule, providing supporting papers/notices and deciding the total duration of meetings. They will ensure compliance with any requirements surrounding the conduct of board meetings, including annual meetings if applicable.

Conforming with Legal Matters

The secretary is liable to have strong knowledge of your company’s article of association – a document that outlines the purpose of your business and the duties of each employee. Furthermore, they should ensure the business complies with the Companies Act 2006 and other lawful matters. This will be beneficial if any legal disputes arise with an employee, for a secretary will be able to outline the claims and determine whether a cause of action is required.

Filing annual returns

All limited companies in the UK are required to submit an Annual Return form (AR01) to Companies House annually. These are essential for outlining general information about your company, including details of share capital, shareholdings, directors and even the secretary. Failing to fill out this could result in a fine of up to £5,000, so if you don’t have enough time then employing someone to undertake this task is probably your best option.

Upholding the registered office address

Communication is at the heart of almost all businesses, and if the details of address should change, it is the secretary’s responsibility to notify Companies House of the new address. Additionally, this includes ensuring the registered office addresses and any further company details are updated on, for example – the company website, business stationery, email signatures and order forms.

Keeping company documents secure

Legal documentations, such as a certificate of incorporation, company seal and share certificates, allow businesses to operate, these cannot be misplaced. A secretary is responsible for keeping these safe.

Signing legal documents

The company secretary must provide the signature for all official documents on behalf of the directors, this includes signing cheques and other bank papers. Forgetting to sign important documents can lead to legal issues and unhappy suppliers if you fail to pay.

About the author

Gina Hutchings is digital marketing consultant with more that ten years of marketing experience in B2B and B2C markets. She guest writes for a number of magazines and has also been featured in The Daily Mail and Forbes.

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