Requirements for Holding Annual General Meetings (AGMs)

Requirements for Holding Annual General Meetings (AGMs)

In Singapore, companies are generally required to hold an Annual General Meeting (AGM) and adhere to specific statutory requirements. However, there are exemptions and alternative arrangements available.

Mandatory Requirements for AGMs

Companies must hold their first AGM within 18 months of incorporation. Subsequent AGMs must be held annually, with no more than 15 months between each meeting. For companies with a financial year ending on or after 31 August 2018, AGMs must be held within four months after the financial year-end for listed companies, and within six months for non-listed companies. The primary purposes of AGMs include presenting and approving the company’s financial statements, declaring dividends, appointing or re-appointing directors and auditors, and addressing any other necessary business. Notice of the AGM must be given to all shareholders at least 14 days before the meeting, or 21 days if special resolutions are to be passed.

Exemptions from Holding AGMs

Certain companies may be exempted from holding AGMs under specific conditions. Private companies with simplified corporate governance requirements can be exempted if all members agree to a written resolution to dispense with AGMs, provided they send financial statements to shareholders within five months after the end of the financial year. Dormant companies, those with no significant accounting transactions during a financial year, may also be exempted from holding AGMs, though they must still prepare financial statements and file annual returns. Additionally, private companies can opt not to hold AGMs if all shareholders agree in writing, provided they send financial statements within five months after the financial year-end. However, an AGM must still be held if any shareholder requests one within six months after the financial year-end.

Practical Considerations

Companies must prepare financial statements, including the directors’ report and auditor’s report, to be presented at the AGM. With advancements in technology and regulatory changes, electronic AGMs may be allowed, subject to specific conditions and provisions in the company’s constitution.

Penalties for Non-Compliance

Failing to hold an AGM when required or not meeting the specified deadlines can result in penalties and fines for the company and its officers. The Accounting and Corporate Regulatory Authority (ACRA) may impose fines and take enforcement action against non-compliant companies.

Conclusion

Holding an AGM is a fundamental aspect of corporate governance, ensuring transparency and accountability to shareholders. While exemptions and alternative arrangements are available, companies must ensure compliance with statutory requirements and maintain proper records to avoid penalties.