Filing of Company Annual Returns in Kenya

Have you filed your company’s annual returns?

If not, then you are at a greater risk of getting penalized by the registrar of companies. You may even lose your company in the end (as your company might be deregistered by the registrar of companies).

So, what are these Annual Returns?

These are the changes that take place in a company during the year. These include changes in company governance, directors, secretary, shareholding and even the company’s registered office.
Taking a closer look at the Section 125 of the Companies Act; it states that:

Every company with a share capital shall make a return at least once every year. The return should be made within fourteen days after the date of the Annual General Meeting (AGM).

When is the right time to finalize your Annual Returns?

This should be conducted at least once, every year.
It is important to finalize your Annual Returns within forty-two days (42 Days) after the annual general meeting for a given year. The company must then submit a copy of the Annual Return to the registrar of companies. The copy must be signed by both the secretary and a director of the company.

Failure to adhering to these requirements, the company officers (directors) will be held responsible. This will lead to a fine by the registrar of companies. A complete Annual Returns form is submitted at the Registrar of companies accompanied by the required fees before it’s accepted for filling. There is a penalty in the case of a late submission for filing of the Annual Returns.

Contents of the Annual Return

The Annual Returns document should be handled by a qualified Company Secretary due to its complexity.
The Annual Returns has the following components:
1. Postal Address and the location of the registered company office
2. Particulars of the sum of the indebtedness of the company as at the returning date. (This includes mortgages and any other charges that must be registered under the Companies Act)
3. The location and address where the register of the members is kept; if stored in a different location from where the company is.
4. A list of the individuals and the postal addresses of those who are members of the company within the fourteen days after the annual general meeting, and those who are no longer members from the time of the last return.
5. A list showing the number of shares held by each existing member at the time of the return and specifying the total shares transferred since the last return.
6. Particulars of those who are directors as well as the secretary (and/or secretaries) of the company as at the date of the return.
7. A compiled report clarifying the shares issued for cash with the shares issued in full or not paid in full. The following are specified:

• The sum of the shared capital of the company and the number of shares into which it is divided

• The number of shares taken from the time the company started till the date of current return

• Amount called up on each share

• The amount of received calls

• Sum of unpaid calls

• Total amount paid in commission for any shares

• Discount allowed on issuance of any shares

• The sum of the discounts allowed since the last return date

• Total number of shares forfeited

• Total amount of shares for which share warrants are outstanding at the date of the return and of share warrants issued and surrendered respectively since the date of the last return, and the number of shares comprised in each warrant.

It is important to note that a company does not need to file a return in the year of its incorporation

Documents to be attached together with the Annual Returns:

• A copy of every balance sheet for the company’s annual general meeting during the return period duly certified as a true copy of the original by both the secretary and a director

• A copy of the report of the auditors on, and of the report of the directors accompanying, each such balance sheet

• A certificate signed both by a director and by the secretary of the company that the company has not, since the date of the incorporation of the company, issued any invitation to the public to subscribe for any shares or debentures of the company.

Comments

comments