UK companies, why bother keeping written records of meetings? Read on...
Updated: Oct 27, 2019
In the course of my work experience I have come across many companies which didn't keep written records of the directors' meetings, this being simply due to the perception of it as unnecessary and some lack of organisation.
"Why bother? We know what we discussed, we know what we decided", one might think.
This is actually a rather common misconception, especially found amid small companies perhaps with two or three directors.
Yet, the reality is that not only is it very good practice to have minutes of all board meetings, but it is also a LAW REQUIREMENT for all UK companies.
For obvious reasons, having a written record of what was discussed and resolved can only be of great help. Can you imagine, in case of disputes, having to prove or even remember after a couple of years which directors agreed or disagreed on this or that matter? Who was present when that damned decision was made? Who made that resolution?
But even more importantly it is required by law.
As provided by Section 248 of the Companies Act, all companies must create written records (called minutes) of the directors' meetings and keep them for at least ten years.
Failure to comply is an offence committed by EVERY OFFICER and is punishable with a summary conviction to a fine up to level 3, so basically £1,000 – obviously for each offender. And if the offence is continued further charges may be levied.
Surely everyone agrees the above two reasons are good enough for being compliant. And if you haven't done that before, it is good to start now. If something has not been done in the past there is no reason why you should not change today: changing for the better is always a good thing!
The taking of minutes can be delegated to someone else, usually a company secretary, who is a professional specialised in this kind of regulatory matters.
So, here's that question again: why bother keeping minutes of meetings? You have the answer now.
The question now is: if you have not kept minutes in the past why not start being compliant from today?
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