Board resolutions are important from the point of business and the Companies Act, 2013.
Board resolutions serve as a formal record of the decisions and actions taken by the Board of Directors. They provide a clear understanding of the company’s direction, goals, and objectives, and also demonstrate the Board’s commitment to good governance and compliance with legal and regulatory requirements. Board resolutions also provide a clear line of accountability and responsibility for the implementation of the decisions taken and serve as a reference point for future actions
As per the Companies Act, 2013, there are certain important board resolutions that must be passed by the Board of Directors of a private company. Some of the key resolutions are:
1. Appointment of Directors: The Board must pass a resolution for the appointment of new Directors or for the re-appointment of existing Directors.
2. Approval of financial statements: The Board must pass a resolution for the approval of the financial statements, including the balance sheet, profit and loss account, and cash flow statement, before they are submitted to the shareholders for approval.
3. Declaration of dividends: The Board must pass a resolution for the declaration of dividends, if any, to the shareholders.
4. Appointment of Auditors: The Board must pass a resolution for the appointment of auditors for the company and also approve their remuneration.
5. Borrowing powers: The Board must pass a resolution for the borrowing of funds by the company and also approve the terms and conditions of the loan.
6. Investments: The Board must pass a resolution for the investment of funds by the company and also approve the terms and conditions of the investment.
7. Issue of shares and debentures: The Board must pass a resolution for the issue of shares and debentures by the company and also approve the terms and conditions of the issue.
8. Alteration of Memorandum of Association and Articles of Association: The Board must pass a resolution for any alteration of the Memorandum of Association and Articles of Association of the company.
9. Appointment of Key Managerial Personnel: The Board must pass a resolution for the appointment of Key Managerial Personnel like CEO, CFO, and CS, as per the requirement of the Act.
10. Approval of Annual Return: The Board must pass a resolution for the approval of the annual return before it is filed with the Registrar of Companies.
The sample format of Board Resolutions is given below for reference purposes only.
Page Contents
- 1. Format of Board Resolution for Appointment of Directors:
- 2. Format of Board Resolution for Approval of Financial Statements:
- 3. Format of Board Resolution for Capital Increase:
- 4. Format of Board Resolution for Dividend Declaration:
- 5. Format of Board Resolution for Borrowing Powers:
- 6. Format of Board Resolution for Investment in Other Companies:
- 7. Format of Board Resolution for Appointment of Auditors:
- 8. Format of Board Resolution for Remuneration of Directors:
- 9. Format of Board Resolution for Appointment of Key Managerial Personnel:
- 10. Format of Board Resolution for Alteration of Memorandum of Association and Articles of Association:
- Minutes of Annual General Meeting (AGM) as per SS- 2
- Minutes of Meeting of Directors, (SS 1 for a private limited company)
1. Format of Board Resolution for Appointment of Directors:
Resolution:
“RESOLVED that [Name of the person] be and is hereby appointed as a Director of the company, to hold office for a period of [period of tenure].
RESOLVED FURTHER that the Managing Director/Secretary of the company be and is hereby authorized to file the necessary forms and returns with the Registrar of Companies and to do all other acts and things as may be necessary to give effect to this resolution.”
2. Format of Board Resolution for Approval of Financial Statements:
Resolution: “RESOLVED THAT the Board of Directors of the company do approve the balance sheet, profit and loss account, and cash flow statement as at [financial year end date], and the reports of the directors and auditors thereon.”
3. Format of Board Resolution for Capital Increase:
Resolution: “RESOLVED THAT the authorized share capital of the company be and is hereby increased from [existing authorized share capital] to [proposed increased authorized share capital] by the creation of [number of shares] new equity shares of [face value of shares] each.
RESOLVED FURTHER that the Directors of the company be and are hereby authorized to take all such steps and to do all such acts and things as may be necessary to give effect to this resolution.”
4. Format of Board Resolution for Dividend Declaration:
Resolution: “RESOLVED THAT a dividend of [amount] per equity share of [face value of shares] be and is hereby declared for the financial year ended [financial year end date], payable to the members of the company on [date of payment].”
5. Format of Board Resolution for Borrowing Powers:
Resolution: “RESOLVED THAT the Directors of the company be and are hereby authorized to borrow, from time to time, such sum or sums of money as they may think fit, and to secure the repayment of any money so borrowed by mortgage or charge on the whole or any part of the property, present or future, of the company.”
6. Format of Board Resolution for Investment in Other Companies:
Resolution: “RESOLVED THAT the Directors of the company be and are hereby authorized to invest the funds of the company in such other companies as they may think fit.”
7. Format of Board Resolution for Appointment of Auditors:
Resolution: “RESOLVED THAT [Name of the auditor], Chartered Accountants, be and are hereby appointed as Auditors of the company to hold office from the conclusion of this meeting until the conclusion of the next annual general meeting of the company.”
8. Format of Board Resolution for Remuneration of Directors:
Resolution: “RESOLVED THAT the remuneration to be paid to the Directors of the company for the financial year [financial year] be and is hereby fixed at [remuneration amount].”
9. Format of Board Resolution for Appointment of Key Managerial Personnel:
Resolution: “RESOLVED THAT [Name of the person] be and is hereby appointed as the [position] of the company, with effect from [date].”
10. Format of Board Resolution for Alteration of Memorandum of Association and Articles of Association:
Resolution: “RESOLVED THAT the memorandum of association and articles of association of the company be and are hereby altered in the manner as set out in the Annexure A attached herewith.”
Minutes of Annual General Meeting (AGM) as per SS- 2
Meeting of the shareholders of [Your Company Name] held on [Date] at [Time] at the registered office of the company, [Your Company Address].
Present:
1. [Name of the shareholder 1] – Chairman
2. [Name of the shareholder 2] – Shareholder
3. [Name of the shareholder 3] – Shareholder
4. [Name of the shareholder 4] – Shareholder
5. [Name of the shareholder 5] – Shareholder
Absent:
1. [Name of the shareholder 6] – Shareholder
The Chairman welcomed all the shareholders present and declared that the quorum was complete for the transaction of the business.
Agenda:
1. Approval of the minutes of the last AGM held on [Date].
The minutes of the last AGM held on [Date] were placed before the shareholders and were approved by all the shareholders present.
2. Adoption of the Annual Accounts:
The Board of Directors presented the annual accounts for the financial year ended [financial year end date] to the shareholders. The shareholders adopted the annual accounts.
3. Appointment of Auditors:
The shareholders approved the appointment of [Name of the auditor], Chartered Accountants, as the auditors of the company for the financial year ending [financial year end date]
4. Appointment of Directors:
The shareholders appointed [Name of the Director 1], [Name of the Director 2], [Name of the Director 3] and [Name of the Director 4] as Directors of the company for a period of [period of tenure].
5. Approval of Remuneration of Directors:
The shareholders approved the remuneration of the Directors of the company for the financial year [financial year].
6. Any other business
No other business was discussed.
The Chairman thanked all the shareholders for their valuable contributions and the meeting was adjourned.
The above minutes of the AGM were confirmed and signed by the Chairman and the Secretary of the company on [Date].
Minutes of Meeting of Directors, (SS 1 for a private limited company)
Here is an example of minutes of a meeting of the Board of Directors of a private company, as per Secretarial Standard 1:
Minutes of the Meeting of the Board of Directors of XYZ Private Limited Held on: 10th January 2023 Time: 10:00 am Venue: Registered Office of the Company
Present:
1. Mr. Ram, Chairman and Managing Director
2. Mr. Hari, Director
3. Mr. Shiva, Director
4. Ms. Govind, Director
5. Mr. Devanand, Director
Absent: None
Agenda:
1. Approval of the financial statements for the quarter ended December 31, 2022
2. Appointment of a new auditor for the financial year 2022-2023
3. Discussion on the new product launch
Decisions Taken:
1. The financial statements for the quarter ended December 31, 2022 were approved by the Board.
2. The Board appointed ABC & Co. as the new auditor for the financial year 2022-2023.
3. The Board discussed the new product launch and gave its approval for the same.
Contracts or Arrangements: The Board approved a contract with ABC Limited for the supply of raw materials for the new product launch.
Matters requiring future action or follow-up:
1. The Chairman was asked to finalize the contract with ABC Limited and get it executed by the authorized signatories of the company.
2. The Board decided to hold a press conference to announce the launch of the new product.
Any other matter: None
The minutes were signed by: John Smith Chairman and Managing Director
Note: These are fictional minutes and not actual minutes of any company.
In summary, board resolutions, Minutes of meetings play a critical role in ensuring the smooth functioning of the business and adherence to the legal and regulatory requirements.
For more details on BR and company compliance can get in touch with Team IN Filings, Bangalore’s Leading Company Secretary and CA office, servicing business for 10+ years.
Author Bio
good to have most resolution in one place to use.
thanks 😊