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Responsibilities of Company Directors

Company Directors

Under the Corporations Act 2001 & general law, as a director you must fully comply with the legal obligations this position entails & be aware of the many & varied responsibilities.  You should reconsider becoming a director if you do not have a willingness or time to put into the endeavour.

As a company director you will have many duties, mainly practicing care & commitment, acting with assuredness in the best interests of the company, preventing the company from trading whilst insolvent &steering clear of conflicts of interest between the company’s & your own.

A director has the responsibility for the company adhering to its obligations as mentioned in the Corporations Act 2001.  These obligations include, but aren’t limited to, the following

A registered office address located in Australia, which ASIC must be informed of.  A company cannot have a post office box as an office address.

A business address which can be the same as the office address, or somewhere different.  However, like the requirement for an office address, ASIC do not allow post office boxes.

Financial records & transactions must be maintained in an accurate & timely fashion with up to date explanations of transactions & financial position of the company.

Director’s personal details must be provided to ASIC.  These include full names, current residential (again, no post office boxes) address, date & place of birth.

ASIC needs to be told of any changes in the company i.e. office and/or business addresses, directors addresses & resignations & appointments, share issues and transfers.  Fines issued by ASIC can applyif they are not informed when these changes occur.

Annual statements issued by ASIC need to be examined to determine if ASIC have correct details of the company & relevant fees to be paid such as the annual review fee.

After your appointment as a company director, as long as you understand your legal requirements, are meticulous in your dealings with the company & on its behalf, keep up to date regarding your company’s finances & performance, and act in the best interests of the company, its shareholders & creditors, it is improbable that you should get into difficulty.  Most importantly, profession advice should be sought if you need to address any concerns that you may have.

Related Tags: Registering a Company | Register a New Company in Australia