Administering a business can be a complex and sometimes thankless task, requiring extensive records and paperwork with little apparent benefit to the business itself. But in a well-managed business, routine company administration and legal paperwork happen largely in the background, without fuss. The directors take their responsibility for company administration seriously, setting up effective systems to ensure that proper procedures are followed in accordance with company law.
In a limited company, administration is the joint responsibility of the directors and the company secretary (if there is one). Although a company secretary is no longer legally required for private companies, many still choose to delegate company administration to one. Routine legal filings and record-keeping can also be delegated to an outside service, though overall responsibility remains with the company officers.
The company secretary typically also takes responsibility for other basic administration: for example, ensuring that the company has the right insurances to licences and permits. Other legal issues such as employment law and health and safety may also be handled by the same individual.
The directors should ensure that there are clear rules on who can sign official documents, such as contracts and the minutes of board meetings. This should include specifying when more than one signature is required.
The company must have a registered office address where official documents can be served on the company. Whether you use a business address or use your advisers (such as an accountant or lawyer) as a registered office, you must be sure that any paperwork will be quickly seen and dealt with. You are legally required to display your business name at your registered office as well as any place of business, and to show details of your company and registered office on business stationery.
Key company decisions are taken at board meetings (by the directors) and general meetings of the shareholders. You must ensure that you follow the proper procedures for calling meetings and taking decisions, in accordance with company law and the company’s articles of association.
Complex rules can apply in some cases: for example, shareholder resolutions requiring more than a simple majority. Procedures for issuing, transferring or buying back shares can also be complex. You should take advice where necessary.
Companies are legally obliged to keep various statutory records – such as the register of shareholders and minutes of meetings. You will also need to keep other important records, such as accounting records and important contracts.
Some company records can be inspected by shareholders, or by members of the general public. You should ensure that you know the rules and set up a system for handling requests to see records.
You are legally required to file an annual return with Companies House. You must also submit a copy of your annual report and accounts, as well as details of various significant changes to the company such as the appointment of a new director.