The Companies and Intellectual Properties Commission (CIPC) has begun implementing a new method to monitor compliance with the Companies Act, by means of a Compliance Checklist.
The Checklist refers to a number of sections of the Companies Act, as well as its Regulations and Schedules, and requires companies to confirm whether they complied with these provisions in the previous calendar year.
As of 1 January 2020, the Compliance Checklist is compulsory, and must be submitted before a company may submit its annual returns. To that end, the CIPC has reminded companies of the following:
1. Failure to file annual returns will result in the deregistration of the company;
2. Section 215(2)(e) read with Section 216(b) of the Companies Act state that it is an offence to knowingly provide false information to the CIPC, with a fine and/or imprisonment up to 12 months.
The Checklist allows the CIPC to monitor and regulate proper compliance with the Companies Act, and serves as an educational tool for directors, company secretaries, auditors and audit firms through a self-assessment model.
The Checklist also applies to non-profit companies.
In order to comply with the checklist, companies must ensure that, among other things, they have:
1. a Memorandum of Incorporation which is compliant with the Act;
2. prepared Financial Statements which satisfy reporting standards;
3. given proper notice of meetings to directors and shareholders, and held their Annual General Meeting; and
4. created and maintained a Securities Register.
To find out more about your company’s compliance responsibilities, or for assistance with implementing the above compliance functions, contact us at (012) 004 1296 or firstname.lastname@example.org.