Companies Act 1990 Next slide Purpose This act

Companies Act 1990 Next slide

Purpose This act outlines the procedures to be followed, when setting up, running and winding up both private and public companies. Knowledge of public companies not required for Leaving Certificate. Previous slide Next Slide

What is a company? The following words are associated with a company, more details in next slides. § § § Shareholders Authorised Share Capital Issued Share Capital Limited Liability Separate Legal Entity Annual General Meeting or AGM Directors Managing Director EGM Registered office Audited accounts Previous slide Next Slide

What is a shareholder? I put money into the I am invited the AGM I to As. I am a. At reward for not involved Also myrich shares company. So I get and thewould AGM each So bang 1 vote per my money I friends get inhave thecan day togo day The company However my might up in continue to year. go my pension!! share. running of the allocates me shares keep warning me I playvalue. my golf. Dividends Help lifeall without company. incould the company lose Ifor have golf. myinvested. money. . Previous slide Next Slide

Authorised and Issued share Capital When a company is being formed, it must declare the amount money it plans to raise through the sale of shares and pay stamp duty on the same, This is known as the Authorised share capital. Issued share capital is the total number of shares sold multiplied by the initial value of each share and it cannot exceed the Authorised share capital, until the relevant stamp duty has been paid. Previous slide Next Slide

Limited Liability and Separate Legal Entity Limited liability, means that a shareholder can only loose the amount he contributed to purchasing his shares. Companies can also be sued and sue in court themselves rather than the owners being sued or suing on behalf of the company, this is known as the company having separate legal entity. Previous slide Next Slide

AGM This is the meeting all shareholders are invited to attend each year. They have one vote per share. If there is important business during the year an other meetings of shareholders can be called, these are called EGM’s. Previous slide Next Slide

Directors and Managing Director § At the AGM the shareholders appoint Directors. § Directors do not necessary have to be shareholders. § These people will meet on a more regular basis to oversee the running of the company and will appoint from among themselves a company chairperson and company secretary. § In some cases the directors will appoint a Managing Director to run the company on a day to day basis. § Directors must declare their interests in other companies, in case of divided loyalties and fraudulent trading by a director can lead to a director loosing the protection of limited liability. § If a director is involved in a company that has become insolvent, they are known as restricted directors and are prohibited from starting another company unless they can produce a certain amount of capital themselves. Previous slide Next Slide

Registered office Audited accounts • Each company must register an address with the companies office. • Each company must have their accounts checked over (audited) by an auditor each year and a copy of these accounts presented to the companies office each year. Previous slide Next Slide

Private Company § When shareholders are selling their shares, the approval of the other shareholders must be sought, as to who the new shareholders will be. § Shares not sold on the stock exchange. § A private company can have only one shareholder, provided there are two directors. § Maximum number of shareholders that a private company can have is fifty. Previous slide Next Slide

Formation of a private limited company § § Memorandum of Association Articles of Association Form A 1 The appropriate fee to cover stamp duty on authorised share capital and registration fee. Click for result Certificate of Incorporation = Incorporated Previous slide Next Slide

Memorandum of Association § The name of the company with Limited or Teoranta after it. § The objectives of the company. § The names of the subscribers and how much each are contributing. § Each subscriber must sign the memorandum of association. § A statement stating "The liability of the shareholders is limited by shares. ". Previous slide Next Slide

Ultra Vires Memorandum of Association states we have permission to sell confectionery We sell computers Memorandum of Association This is ultra vires Previous slide Next Slide

Articles of Association § Procedure for calling company meetings. § The voting procedure at company meetings. § Details of how the company would be wound up, if this were to happen. § Policy with regard to the payment of dividend, as opposed to putting the profits into reserves. § Details of policy to be followed, if one of the shareholders id selling some or all of their shares. § Procedures for appointing and removing directors. Previous slide Next Slide

Form A 1 § Statement of the amount of the Authorised share capital § Declaration of compliance with the Company's Acts 1963 -1990 § Name of the first company secretary § Names of the first directors § Company's registered office Previous slide Next Slide

RESULT Private Company Previous slide Next Slide

Companies Act 1990 The end Previous slide