Company's act

• What is the main focus of the Companies Act study material?

  Understanding and applying the Companies Act principles.
• What sections of the Companies Act should be applied in scenarios?

  • Sections 86 – 89 on the Company Secretary
  • Section 94 on Audit committees
  • Section 159 on the protection of whistle-blowers
• What is the framework for answering Companies Act questions?

  State, Define, Apply & Conclude method.
• What does the 'State' step involve in the Companies Act question framework?

  Identifying what is wrong according to the scenario.
• What is required in the 'Define' step of the Companies Act question framework?

  Listing the theory of the applicable section of the Companies Act.
• In the 'Apply' step of the Companies Act question framework, what should be done?

  Apply the section discussed in the 'Define' step to the scenario.
• What is the purpose of the 'Conclude' step in the Companies Act question framework?

  To determine if the section defined and applied is in contravention of the Companies Act.
• Who must appoint a company secretary according to Section 86?

  Public companies and state-owned companies must appoint a company secretary.
• What qualifications are required for a company secretary under Section 86?

  A company secretary must have knowledge of relevant laws and be a permanent resident of South Africa.
• When must a company secretary be appointed according to Section 86?

  Within 40 business days of the incorporation of the company.
• What happens if a vacancy arises in the office of the company secretary?

  The board must fill the vacancy within 60 business days.
• Can a juristic person or partnership be appointed as a company secretary?

  Yes, if the person(s) appointed are qualified and at least one employee is not disqualified.
• What must happen if there is a change in membership of a company secretary?

  If the requirements are still met, nothing happens; otherwise, notify directors and consider it a resignation.
• Who is a company secretary accountable to?

  The board of directors.
• What are the duties of a company secretary?

  Providing guidance to directors, making them aware of relevant laws, and reporting compliance failures.
• When can a company secretary resign?

  Anytime, but must give one month notice or less with board approval.
• What must be included in the AFS if a company secretary is removed by the board?

  A statement outlining why the company secretary was removed.
• Who must appoint an audit committee at each AGM according to Section 94?

  Public companies and state-owned companies must appoint an audit committee.
• What is the composition requirement for an audit committee?

  At least three members unless specified otherwise.
• Who qualifies as an audit committee member?

  Each member must be a director and not involved in day-to-day management.
• What are the duties of the audit committee?

  Nominating auditors, determining audit fees, and ensuring compliance with the Act.
• What does Section 159 of the Companies Act provide for whistle-blowers?

  Protection for whistle-blowers and their rights.
• Can provisions of the MOI limit or negate Section 159?

  No, if they do, they are void.
• What disclosures fall under Section 159?

  Disclosures made in good faith about non-compliance with the Companies Act or conduct endangering health or the environment.
• What rights do whistle-blowers have under Section 159?

  Qualified privilege and immunity from civil, criminal, or administrative liability.
• What must public companies do regarding whistle-blowing mechanisms?

  Implement whistle-blowing mechanisms and notify relevant persons of their availability.
• What are the key sections of the Companies Act related to company secretaries and audit committees?

  • Sections 86-89: Company Secretary
  • Section 94: Audit Committees
  • Section 159: Protection for Whistle-blowers
• What are the main duties of the audit committee?

  • Nominate auditors
  • Determine audit fees and terms
  • Ensure compliance with the Act
  • Pre-approve non-audit services
  • Prepare reports on functions and auditor independence
• What are the duties of a company secretary?

  • Provide guidance to directors
  • Ensure compliance with laws
  • Report failures to comply
  • Record minutes of meetings
  • Certify accuracy of financial statements
• What is the process for appointing a company secretary?

  1. Mandatory for public and state-owned companies
  2. Appointed within 40 business days of incorporation
  3. Board or shareholders can appoint
  4. Juristic persons can be appointed if qualified
• What happens if a company secretary is removed?

  • Company must include a statement in AFS
  • Written notice required
  • Statement included in directors' report
• What protections do whistle-blowers receive under Section 159?

  • Protection from retaliation
  • Immunity from liability
  • Right to compensation if harmed