Back when we were operating under the old Companies Act we used to be required to have members and once a year we would have an annual general meeting. It was a bit silly in that we would just close the normal board meeting and then open the AGM with the same participants, do the required things and close the meeting.
Now that we are operating under the new Companies Act and have chosen not to have members, we have not been having a separate AGM. I’m fairly sure I was told that was correct. But as we have been working on funding applications there is often mention or a question on when we have our AGM.
Do we legally still need to have an AGM? If not and we chose to have one anyway, just to help us in our applications, is there anything we need to be aware of and would you suggest that we do something similar to what we did before where we would just close a normal board meeting and then open the AGM for the formality of having one? Would the annual financial statements typically be signed at an AGM, as well as auditors appointed?
Dear No-members NPC
You are correct- without members, there is no legal requirement for an AGM to be held, in fact, it is legally not possible to do so, since an AGM is a meeting of members/shareholders. In fact, the new Companies Act defines an AGM as ‘the meeting of a public company required by section 61(7)’. As an NPC is not a public company, this section and definition do not apply.
My suggestion is that, when funding applications ask for details of your AGM you fill in ‘not applicable’. If there is a narrative description of the meeting and what occurs to be completed, you could say something like:
The non-profit company has no members and only a board of directors, and therefore it is not necessary or possible to hold an AGM. However, the Board does set aside a meeting in each year at which the typical agenda items for an AGM, are dealt with. Thus, at the meeting of the Board on …., the financial statements as presented by the auditors were considered and adopted, the appointment of auditors was confirmed, the Board considered and accepted the report by the CEO of the activities for the past financial year, and the Board dealt with any director resignations/appointments which were required.