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Annual General Meeting – Getting it Right

An Annual General Meeting (“AGM”) is a meeting of the members and is a statutory requirement for every Company. The Companies Act 2014 states that if a default is made in holding the AGM, the company and any of its officers who are in default will be guilty of a category 3 offence.

Routine Business of the AGM

The routine business of an AGM is as follows:

1: Receive the report and accounts laid before the meeting

2: To seek approval of the report on directors’ remuneration, which appears in the report and accounts

3: Declare the final dividend

4: Appoint or reappoint the auditors and determine their remuneration

5: Elect the directors who have been appointed since the last AGM.

Timing of the AGM

The first AGM of a company is held within 18 months of its incorporation. They are then held once a year, and must be held within 15 months of each, however, an AGM must be held in every calendar year.

Quorum for the AGM

The minimum number of members that must be present at the AGM is called the quorum. The quorum for limited companies is two members (except in the case of single member companies) and the quorum for PLCs is three members. Failure to have a quorum will result in the AGM being adjourned.

Notice Period of the AGM

The Companies Act 2014 specifies that a notice period of 21 clear days (24 days to include the date of postage, the 24 hours following postage and the date of receipt) must be given to all members entitled to vote at and attend the meeting. If this notice period is not given, the events of the meeting can be disregarded. However, a shorter notice period may be given if all members entitled to attend and the company’s auditors (if the Financial Statements are audited) give written consent for this to happen.

Voting at the AGM

Members who are entitled to vote at the AGM may appoint ‘proxies’ to attend and vote on their behalf if the members are unable to attend.

Minutes of the AGM

The minutes of a company’s AGM may be reviewed by all members, and

some companies, such as charities, may release their AGM minutes for public

viewing.

Dispensing with the AGM

Single-member companies are not required to hold an AGM. If the sole-member wishes to dispense with the holding of the AGM, they must put this decision in writing and address it to the company. The directors are then obliged to send the accounts to the sole-member for review/approval.

If the company is a multi-member company, a resolution can be passed each year in order to dispense with the AGM. The resolution must be signed and also expressly acknowledges the acceptance of the financial statements.