The Companies and Intellectual Property Commission (CIPC) has announced new requirements for companies when completing their Annual Returns.
From 1 January 2020 it will be mandatory for the following companies to complete a compliance questionnaire when submitting their Annual Return:
- Incorporated – Inc (21)
- Proprietary Limited -(Pty) Ltd (07)
- Limited – Ltd (06)
- State Owned Company – SOC (30)
- Non-Profit Company – NPC (08)
- The Rationale for the questionnaire
The CIPC will use the questionnaire to assess areas of non-compliance within the Companies Act (“the Act”) and will take action where it sees the need to address any weaknesses.
It also serves to ensure that directors and officers of companies know and understand the mandatory compliance aspects of the Act.
If you do not complete the questionnaire, then you will not be able to file the Annual Returns.
- What is in the questionnaire?
You are asked to state whether you comply with a list of important areas of the Companies Act.
The main areas covered are:
- Did the company meet solvency and liquidity requirements?
- Does your MOI and shareholders agreement or changes thereto comply with the Act?
- Have you compiled Annual Financial Statements in line with the Acts requirements?
- Do you handle financial assistance to directors correctly?
- Is your shareholder register compliant?
- Do directors run the company along the stipulations set out in the Act?
- Do you have a company secretary?
It is an offence to make false declarations to the CIPC.
These answers need to be true and accurate. It is critical that the person completing the questionnaire understands the Act and the requirements of the relevant sections of the Act and applies their mind to the answers provided.
- Why the compliance checklist
To ensure compliance of the mandatory requirements of the Companies Act such as described in Section 15 – requiring every company to have an MOI.
Serves as an educational tool for directors and company secretaries, in guiding them with regards to their responsibility in terms of the Companies Act.
CIPC will utilized the Checklist to monitor and regulate proper compliance with the Companies Act and if trends of non-compliance appear, to act accordingly.
4. When to submit your Annual Return
Companies are required to submit their Annual Return in the thirty (30) business days after the anniversary of their date of incorporation – i.e. if the company was incorporated on 10 June then you have thirty business days from 11 June to complete the return.
- If you fail to submit an Annual Return, the CIPC will take this to mean your company is no longer active and will begin company deregistration proceedings.
If Nwanda attends to your company’s annual returns, there is no need to be concerned as we will deal with the new requirements on your behalf.
If you are not a client and would like Nwanda to handle these requirements for your company, please contact Samantha@nwanda.co.za