Working with Companies House
Comments from ACCA
October 2007
ACCA is pleased to comment on the consultation paper of the above title. Our comments reflect the views of ACCA's Business Law Committee, whose members have extensive experience of working with Companies House as company secretaries, directors or practising accountants. Our responses to selected questions are set out below.
Q1 Do you agree that the above principles are key factors in developing the rules?
Yes – with respect to the third principle listed, increasing the facility to use e-communications should present companies and Companies House with the opportunity to make cost savings.
Q2 Can you suggest any other principles that we should take into account?
We suggest adding to the list a reference to the importance of ensuring the security and integrity of information that is placed on the public record.
Q3 Do you agree that the current system of company and personal authentication codes works satisfactorily?
We agree that the system operates efficiently. But the system rests on the retention and use of three different code numbers: where a director or secretary is responsible for making out a large number of returns or forms, it is necessary to use the corresponding number of different codes, which can be complicated. We suggest that the feasibility of alternative procedures be investigated.
Q4 Do you agree that the authentication of electronic documents is an important part of helping to ensure the authenticity of documents?
Yes. In our view, however, it is quite possible to circumvent the current safeguards. For example, an individual who knows the code numbers is able to complete and post documents on behalf of all the companies concerned, and hard copy confirmations of code numbers are sent by post and can be opened by any person within the organisation.
Q6 Do you think that the system of ‘functional descriptions' for forms and electronic transactions would be preferable to the current section number-based system?
No, we think this would be a retrograde step. While the new section numbers under the Companies Act 2006 will take time for users to familiarise themselves with, the section-based system amounts to a more concise and simple way for them to refer to statutory forms dealing with particular matters. The section-based system, in its brevity, also makes sense in connection with the layout of Companies Hose Direct.
Q10 Do you agree with the proposals on where documents should be sent?
At present, the approach adopted by Companies House is, in practice, very flexible: if documents relating to a Scottish company are delivered to Cardiff or London , they are treated as having been formally on the date of delivery there, and the documents are transferred to the other office as appropriate. We believe this approach is business-friendly and represents a common sense way of operating within the single UK-wide company law regime. We believe this approach should continue.
Q13 Do you agree that signatures on paper documents are an important part of helping to ensure the authenticity of the documents?
Signatures are indeed an important element, although they are far from being foolproof.
Q15 Do you agree that it would be helpful to provide standardised formats for resolutions?
No. There are already many publications available which contain precedents and these are available for any company to consult and use if they wish. It must also be remembered, of course, that the details of any particular resolution will depend on what action the company is proposing to take.
Q17 Do you think there should be transitional arrangements to allow ‘old' forms to be filed for a set period after implementation of the new Act?
We do not think this would be necessary or desirable.
Q20 Do you agree that in order to ensure the quality of the register, the registrar should normally reject documents that are not properly delivered so that the company/presenter can correct them accurately themselves.
We strongly agree with this.