John Korchak of Inform Direct takes a fresh look at company secretarial, which offers accountants another revenue stream
As an accountant, your skills and outlook make you ideally placed to offer a professional service to your clients to ensure company secretarial compliance. This is already offered by some practices and it can produce a valuable revenue stream, alongside other services. So why is it important and how can you start – or expand – your company secretarial service?
Company secretarial might not be the first service for which directors look to their accountant for support. They might not think they need help. They may not see it as a service worth paying for. They might not be aware of their company secretarial responsibilities in law or, worse, decide those duties don’t really matter.
However, there are five key reasons why clients should seek professional help from their accountant to fulfill their company secretarial responsibilities.
- The Companies House Register provides online accessible data available to view – including every filing – with an estimated three million visits per month. Because of that, overdue deadlines are highlighted and filings to correct earlier errors are visible.
- Information from the public record is used by banks and other lenders before opening accounts or making lending decisions and by potential suppliers and customers before transacting business. Shareholders and investors can also inspect a company’s statutory registers and if they are incorrect or incomplete, serious repercussions could result.
- Not filing certain documents is a criminal offence, for which directors can be personally convicted in the criminal courts. In 2019/20, Companies House summoned 3,779 directors to court for failure to file accounts or confirmation statements, with more than half convicted. Individuals can also be disqualified from acting as directors for failing to meet their legal responsibilities, with 1,485 individuals barred in this way in 2019/20.
- Failure to submit the annual confirmation statement, accounts or notification of a change of registered office to Companies House can each lead to the start of a compulsory strike-off procedure. Once a company has been struck off, the process of restoration is often complex and costly.
- Finally, remedial action when something goes wrong can be both time-consuming and costly for a company, perhaps requiring the services of a solicitor or court order.
Even in the happy situation that companies get the details right, an accountant can often – especially with the right tools – complete the work faster, allowing directors to focus more time on growing their business.
Starting a company secretarial service
If you’re new to company secretarial, you might start with a core offering based around the annual confirmation statement and maintenance of statutory registers. You’ll likely also support common events, including new company formations, changes to company directors and people with significant control (PSCs), share allotments and transfers.
Expanding your company secretarial service offering beyond your core solutions can deliver an even greater number of benefits. It can set your practice apart from competitors, help to win new clients, strengthen existing client relationships and create opportunities for additional chargeable services.
An enhanced company secretarial proposition forms part of an integrated holistic service to clients, enhancing your professional reputation as their trusted adviser.
Examples of how you could expand your service might include:
- Supporting clients with meetings and decision-making, including the creation of compliant documentation in the form of minutes and resolutions.
- Managing reorganisations of share capital, including new share classes, share split, consolidation, redemption, conversion and cancellation.
- Handling more complex company changes, such as updates to a company’s constitutional documents, company name changes, strike offs and mortgages.
- Helping clients to set up share option schemes and manage the grant, exercise and lapse of options.
- Forming and supporting the company secretarial responsibilities of other company types, including companies limited by guarantee and public limited companies as well as limited liability partnerships.
- Assisting with enquiries from Companies House, the reconstitution of company registers or other individual projects.
- Acting as an appointed company secretary for your clients.