Does anyone have a link to a summary of what existing CC's must do now to be compliant with the Act?
Does anyone have a link to a summary of what existing CC's must do now to be compliant with the Act?
"If at first you don't succeed, do it like your mother told you."
1) No new CCs can be created.
2) Companies can no longer be converted to CCs.
As far as I know that's the majority of the requirements to do with CCs. Your existing CC will still have to comply with the requirements of the Close Corporations Act.
Don't think there's anything else. Correct me if I'm wrong.
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KimH (10-May-11)
So as existing CC's we don't have to convert to some new fangled type of entity. Business as usual except we have to draw up a MOI?
(I own 100% interest in my company, I do not offer shares.)
"If at first you don't succeed, do it like your mother told you."
Pretty much. To my knowledge, existing CCs will remain CCs, honouring their perpetual existence. I wasn't actually aware that you had to draw up a MOI. You are probably right, but I just find it strange that it wasn't included in my syllabus (studying the new Companies Act at the moment) when CCs is one of the main focal points.
I'll do some quick research for you.
Mark My Words - Arbitrary thoughts on ordinary things"The way to gain a good reputation, is to endeavor to be what you desire to appear." - Socrates
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KimH (10-May-11)
Thanks Mark. All I have been able to find are very lengthy references to the act - wish someone could summarise it for us less than legal types
"If at first you don't succeed, do it like your mother told you."
Ok, so I've skimmed through the amendments to the Close Corporations Act by the Companies Act. There are a whole lot of small tweaks that are probably irrelevant to your business. A few things to do with liquidation and dissolution of CCs, mostly.
The important thing is:
Basically, your CC will continue to exist in compliance with the Close Corporations Act until it is deregistered or dissolved.A corporation formed in accordance with the provisions of this Act is on registration in terms of those provisions a juristic person and continues, subject to the provisions of this Act, to exist as a juristic person notwithstanding changes in its membership, or its conversion to a company in terms of Schedule 2 of the Companies Act, until it is [in terms of this Act] deregistered or dissolved...
Also, I could not find anything to do with having to submit a MOI. As long as your founding statement and (optionally) Articles of Association are lodged with the Registrar, I can't see anything else you have to comply with in that regard.
One other thing:
Just a change on the slack after year end during which to submit your financial statements from 9 months to 6 months.The members of a corporation shall within [nine] six months after the end of every financial year of the corporation cause annual financial statements in respect of that financial year to be made out in one of the official languages of the Republic.
Also, in some instances, where a private company is required to be audited as determined by the Minister, a CC may also be subject to an audit of its financial statements.
Your accounting officer should inform you of that kind of requirement, though.
Hope that helps!
Mark My Words - Arbitrary thoughts on ordinary things"The way to gain a good reputation, is to endeavor to be what you desire to appear." - Socrates
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KimH (10-May-11)
Mark, that helps tremendously.
I can't thank you enough for taking the time and trouble to get this information for me.
When you are in CPT... let me know - I owe you a beer or 4
"If at first you don't succeed, do it like your mother told you."
Companies_Act_Guide Pg 22.pdf Some further confirmation on what Mark has sent, off the DTI companies act guide on page 22.
KimH (11-May-11)
A CC will only need to do an MOI when it converts into a Company - this is not required but will be done for free within the next 3 years (according to the DTI). the process of conversion also provides an opportunity to revise and redesign a businesses structure - some of the areas that can be looked at during the conversion are highlighted HERE
IS there still a benefit of keeping a CC, instead of converting to a company?
And what is a MOI?
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