The Annual General Meeting is a key event for a Company and it is important for the directors, secretary and shareholders to understand the business which is to be transacted at the AGM each year.
Pursuant to section 175 of the Companies Act 2014, an AGM must be held within 18 months from incorporation of a company and then on an annual basis, without 15 months elapsing from one AGM to another.
Unless consent to short notice is granted, notice of the AGM is to be issued to members 21 days before the meeting. In addition to providing the date, time, location and proxy details, the notice should detail the general nature of the business to be transacted at the meeting.
Business of the AGM
The AGM is an opportunity for the members to meet the board or directors, to receive information about the performance of the company and to ask questions. Section 186 of the Companies Act 2014 outlines the business of the AGM.
The main business of the AGM is consideration of the statutory financial statements, director’s report and where applicable the report of the statutory auditors. The remainder of the business to be transacted is as follows:
- Review of the company’s affairs;
- If applicable, declaration of a dividend, unless the constitution provides otherwise;
- If applicable, authorisation of the directors to approve the remuneration of the statutory auditors, unless the constitution provides otherwise;
- If provided for by the constitution, election and re-election of directors;
- If provided for by the constitution, remuneration of directors; and
- If applicable, the appointment or re-appointment of statutory auditors.
It is possible for other business to be transacted at the AGM and such business will be special business of the AGM. Examples of business which might be tabled as special business at the AGM include amendment of the constitution, changing the company name or conversion of the company. The notice of the AGM will provide the members with details of the special business.
Recording the Business Transacted
The proceedings of the AGM will be recorded in the minutes of the meeting. In most cases, the Company Secretary will take the minutes of the meeting. Section 199 of the Companies Act 2014 provides that a company must enter all minutes and terms of resolutions in the relevant books as soon as is possible following the meeting.
Dispensing with the AGM
LTD type companies and single member DAC type companies may dispense with the holding of the AGM, if all the members entitled to attend and vote at such meeting sign a written resolution acknowledging:
- Receipt of the financial statements that would have been laid before the meeting;
- Resolving all such matters as would have been resolved at the meeting; and
- Confirming that no change is proposed to the appointed statutory auditor.
Although it may be suitable for some small companies to dispense with the holding the AGM, the meeting is actually an excellent opportunity for the members to become more informed on the activities of the company and to engage with the board of directors.
As with most Company transactions, it is advisable that members and directors carefully review the Constitution and seek professional advice when arranging or convening the AGM of the company in Ireland.