Company Director Information for UK Limited Companies

Appointing the Directors

The members (shareholders) of the company decide who are to be the directors. This will normally be done in a general meeting though a company can make decisions by written resolution signed by all members entitled to vote. The directors are responsible for appointing the secretary. When a new officer is appointed a form AP01 must be filed with Companies House within 14 days.

If a company director or secretary moves house or changes their name the details should be amended in the Register of Directors/Secretaries and Companies House should be notified on form CH01. Companies House must be notified within 14 days of the change.

Generally it is up to the members (shareholders) to appoint the people they believe will run the company well on their behalf. Except for occasional restrictions imposed by the government on the activities of certain foreign nationals, a director can be of any nationality and can live any where in the world. The only restrictions that prevent anyone becoming a director are:

• the person must not have been disqualified by a court from acting as a company director (unless he or she has been given leave (permission) to act by a court for a particular company);
• the person must not be an un-discharged bankrupt (except with leave of the court);
• they must be at least 16 years of age;
• for a PLC or their subsidiaries, anybody over the age of 70 unless specifically approved by a general meeting of the company.
   

No, there is no requirement for directors to also be shareholders unless the company's own Articles of Association actually state this (very rare). However, as the shareholders are responsible for appointing the directors it is common for the shareholders to also be the directors of small companies.

The directors are responsible for the management of the company, While their powers can be restricted by the company's articles they can, in most cases do anything that the company can do. With these powers, come responsibilities. Since the directors can act as and for the company, they must ensure that the company does everything that it is obliged to do by law and that the decisions they make are in the best interests of the company. In this context the interests of the company are those of the shareholders as a whole. These may be different from the interests of customers, employees, individual shareholders or the directors themselves. Except where powers are delegated to a committee of directors or to a managing or executive director, the directors act collectively as a board. Individual directors do not have the authority to commit the company unless authorised by the board.

Every company director has a personal responsibility to ensure that statutory documents are delivered to the Registrar as and when required by the Act. The following are of particular importance:

• Submitting annual accounts (only for limited companies). Failure to submit accounts on time can lead to increasing penalties, the dissolution of the company and prosecution. See the notes below.
• Submitting the annual return. Whilst this may be completed by the company secretary it is the directors responsibility to ensure that it is submitted on time
• notice of change of directors or secretaries or in their particulars
• notice of change of registered office
  TOP

All the directors of the company could be prosecuted. Failure to deliver documents on time is a criminal offence . On conviction, a director could end up with a criminal record and a fine of up to £5,000 for each offence. Alternatively, if the Registrar believes that the company is no longer carrying on business or in operation, he could strike it off the register and dissolve it. If this happens all the assets of the company, including its bank account and property, generally become the property of the Crown. The company can only be restored to the register and continue in existence by means of a court order.

Yes. On average more than 1,000 directors are prosecuted each year for failing to deliver accounts and returns to the Registrar on time. Persistent failure to deliver statutory documents on time may also lead to a director being disqualified from taking part in the management of a company, for a specified period.

As a director of a private limited company, you normally have a maximum of 9 months from the accounting reference date in which to deliver your company's accounts to the Registrar. The accounting reference date is the date to which your accounts must be prepared. As a director of a public limited company , you normally have a maximum of 7 months from the accounting reference date in which to deliver your company's accounts to the Registrar. If accounts are received late, the company will automatically be charged a 'late filing penalty'. These penalties can be in addition to any fine imposed by a court. The late filing penalty will be calculated according to the following scale:

The penalties are doubled if the company also filed the previous accounts late.

Make sure your company complies on time with all its filing obligations, not only in connection with its accounts and annual returns, but in connection with all other documents required under the Act.

A company's business stationery need not show the names of the directors but, if it does, it must include all of them. There is no requirement to show the name of a company secretary who is not also a director. 

While companies must keep their own register of directors and secretaries, which must be available for public inspection, Companies House also keeps a register based on information provided by individual companies. This is used by Companies House when it produces the annual return form for each company. It is also used as a convenient way of providing information to anyone who needs it. The register includes details of the appointments held by individuals as well as the directors and secretaries of particular companies.

Anybody is entitled to know who the directors of a company are. They are also entitled to know whether a director holds, or has recently held, directorships of other companies. This information should be shown in the company's register of directors and secretaries, on the form AP01 notifying the appointment of a director and on the annual return. (Other directorships are not currently pre-printed on the annual return form).