Board meeting and a general meeting of a limited company often directly reflects the company's accounting and financial management. Accounting And Financial Management Service Tilityy needs information about such meetings and an the meeting minutes.

In small limited companies, entrepreneurial shareholders are usually responsible for managing the practical everyday operations. They and possible elected CEO formally act under the direction and decisions of the board of directors, but in practice in small companies board meetings and the general meetings are easily left as technical formalities, and official minutes are made for accounting or authorities, only if necessary. The background is that there is no need for separate actual meetings when all owners are actively involved in day-to-day operations and decision-making.

The role of board meetings and general meetings is much more significant when operations are growing or when the company's owners include also persons or operators that are not involved in the company's day-to-day operations. However, they or their representatives may be members of the company's board of directors deciding, aligning and supervising the company's operations, ie how and in to which direction the company's CEO and other active management of the company manage the company in everyday life.

General meeting that convenes at least once a year, and when needed, is the company's highest decision-making body, where the shareholders of the limited company have voting rights and through which they can exercise power in the company (based to the number of shares they manage). General meetings give the board of directors and operational management of the limited company guidance on broad lines and decides on specific financial and administrative matters, such as the distribution of dividend and elects the members of the board of directors.


General meeting
A convening of the general meetings is a responsibility of the board of directors. General meetings must be held at the company's domicile, unless the articles of association assigns another location.

Unanimous shareholders may decide on matters pertaining in the General Meeting without holding a actual General meeting. The decision thus made must be recorded in a meeting minute, dated, numbered and signed by at least two shareholders.

An annual general meeting must be held within six months of the end of the financial year. It decides, among other things, on the approval of the financial statements, the use of profits, the discharge of liability of the management and it elects the members of the board of directors and the auditor. By the law, an annual general meeting has to be held at least once a year.

In addition, An extraordinary general meetings can be arranged in the limited company. An extraordinary general meeting must be convened if the articles of association so demand, the board of the directors sees a need for it or the shareholders (shareholders managing together at least one tenth of the company's shares) or the auditor so requests. It is also possible that the separate supervisory board elected for the limited company requests a general meeting, in which case it must also be convened.

 

Board meetings
The company must always have a board of directors that takes care of the company's administration and the proper organization of operations. Unless otherwise assigned in the limited company's articles of association, one to five responsible members must be elected to the board of directors. The board of directors of a limited company has general competence in the company's affairs, ie it can decide on matters that are not subject to the general meeting to decide by law. The decision of the board will be the opinion of the majority, unless a qualified majority is required. In the event of a tie, the chairman of the Board shall decide.

The law does not specify the frequency of board meetings or the mandatory of certain meetings. The board is primarily an executive and decision-making body that meets when necessary, rather than at regular intervals.


In the case of a sole proprietor, ie one person owns all the shares in a limited company

Limited Liability Companies Act allows a limited company to have only one owner. In this case, he is solely responsible for the operations of the limited company and exercises the decision-making power in matters concerning the company. A sole proprietorship limited company must also have a board of directors. The number of required board members is specified in the articles of association. The minimum is one responsible member (for example, the sole proprietor) and one deputy member (needed in case of exceptional situations).

If there is only one shareholder in a limited company, he will hold all the meetings by himself. However, a sole proprietor may, if he wishes, invite, for example, a lawyer to attend the meeting as a secretary.


List of mandatory meetings of a limited liability company, which must be held from the point of view of accounting and financial management, and for which Tilityy without exception need the meeting minutes


Election of the auditor (requires a general meeting)
The board of directors convenes the general meeting. The notice of a convening of the general meeting must specify that the election of the auditor is on the agenda of the meeting so that the election can be made at the meeting. Usually, the board of directors has already prepared a proposal on the person and/or organization to be elected as the auditor. A meeting minute must be made, in which the decisions and the results of any votes shall be recorded. If a new auditor is appointed in a general meeting, the limited liability company must make a change notice to the Trade Register and attach an extract from the minutes to the notice.

Shareholders may also choose an auditor without holding an actual general meeting if they are unanimous in their decision. The unanimous decision of the shareholders without a general meeting must also be properly documented and the minutes submitted to the accounting as well as to the Trade Register.

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Approval of the financial statements (requires a general meeting)
A general meeting of a limited liability company must be held within six months of the end of the financial year. This annual general meeting approves (often on the proposal of the board of directors) the financial statements of the limited liability company and decides on possible discharge of liability for the management and responsible persons of the target financial year.

Shareholders may also decide to approve the financial statements and grant discharge without holding a separate physical general meeting if they are unanimous in their decisions. The unanimous decision of the shareholders without an annual general meeting must also be properly documented and the minutes submitted to the accounting.

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Amendments to the articles of association of a limited liability company (requires a general meeting)
Making amendments to the company's articles of association always requires a decision by the general meeting.

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Dividend distribution (requires a general meeting)
The annual general meeting decides on the distribution of dividends. This is usually based on a proposal from the company's board of directors, but, of course, changes to the proposal can be made by the general meeting.

Shareholders may also decide on the distribution of dividends without holding a separate physical general meeting, if they are unanimous in their decision. The unanimous decision of the shareholders without an annual general meeting must also be properly documented and the minutes submitted to the accounting.

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Remuneration policy (requires a general meeting, applies to remuneration of listed companies)
The aim of the company's remuneration policy is to promote the realization of the company's current strategy and long-term business profitability. The remuneration policy of a listed company must be presented to a general meeting at least every four years. The general meeting will decide whether it supports the proposed remuneration policy.

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Modification of the rights of a share class specified in the company's articles of association (requires a general meeting)
If it is decided to combine share classes of the limited liability company or to change the rights granted by them, the matter will be decided by a general meeting.

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Election of the chairman of the board of directors (requires a board meeting)
Unless otherwise provided in the company's articles of association, the chairman of the board is elected by the company's board of directors.

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Election of the members of the board of directors of a limited liability company (requires a general meeting)
The members to the company's board of directors are elected by an general meeting, unless the company's articles of association assign that the election is made by a separate supervisory board.

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Election of the CEO of a limited liability company (requires a board meeting)
The CEO of a limited company is elected by the company's board of directors, which also decides on matters related to the CEO's remuneration.

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Dismissal of a member of the board of directors of a limited liability company (usually requires a general meeting)
A member of the board of directors of a limited liability company may be dismissed before the end of his term by "the one who elected him". However, a member elected by company's another  body than a general meeting may be dismissed by a general meeting if the articles of association have been amended so that the right to elect no longer exists.

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Increasing of a Limited Liability Company's Fund (requires a general meeting)
The limited company's fund increases are decided by the limited company's general meeting.

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Permanent change of the Limited Liability Company's financial year (requires a general meeting)
If the company's financial year is changed permanently, the matter will be decided by the Annual General Meeting.

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Temporary minor change to the lenght of a financial year of a Limited Liability Company (requires at least a board meeting)
If there is a need for a temporary and insignificant change needed to the lenght company's financial year, the matter may be decided by a meeting of the company's board of directors. This may be due, for example, to a temporary exceptional social situation, such as a coronavirus pandemic in 2020 and 2021.

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Tilityy's Sales And Customer Service is happy to answer all your questions meeting policies of a limited company.