ACCA F4 - Corp and Business Law (ENG)

Part F Management, administration and regulation of companies  19: Other company officers 301

Chapter Roundup

 Every public company must have a company secretary, who is one of the officers of a company and may
be a director. Private companies are not required to have a secretary.

 Every company (apart from certain small companies) must appoint appropriately qualified auditors. An
audit is a check on the stewardship of the directors.

 The Companies Act provides statutory rights for auditors to enable them to carry out their duties.

 Auditors may leave office in the following ways: resignation; removal from office by an ordinary
resolution with special notice passed before the end of their term; failing to offer themselves for re-
election; and not being re-elected at the general meeting at which their term expires.

 However auditors leave office they must either: state there are no circumstances which should be brought to
members' and creditors' attention; or list those circumstances. Auditors who are resigning can also:
circulate a statement about their resignation to members; requisition a general meeting; or speak at a
general meeting.

Quick Quiz

1 A private company with a sole director is not legally required to have a company secretary, but if it does,
the sole director cannot also be the company secretary.

True^

False

2 State two reasons why a person would be ineligible to be an auditor under Companies Act 2006.

(1) ............................................................................................................................................................

(2) ............................................................................................................................................................

3 Which of the following is NOT a recognised qualification that allows an individual to act as a company
secretary?

A ACCA
B Solicitor
C Business Studies degree
D Employment as a company secretary for three of the five preceding years

4 Zee plc is a retailer of sportswear. Last year its turnover was £3million and its balance sheet total was
£1.5million.

Zee plc is exempt from audit.

True^

False

5 Which of the following resolutions is required to remove an auditor of a private company?

A Ordinary resolution with usual notice
B Ordinary resolution with special notice
C Special resolution with usual notice
D Special resolution with special notice