Companies are obliged to make a return to the registrar at least once every year. Discuss the law relating to making of annual return.

1. Companies with share capital
Under section 125(1) of the Act, every company with a share capital must at least once every year, make a return to the registrar with respect to:

• The registered office of the company
• Registrar of members
• Registrar of debenture holders
• Registrar of shares and debentures
• The indebtness of the company
• Past and present members of the company
• Matters specified in Part I of the 5th schedule of summary of the shares.
2. Companies with no share capital:
Under Section 126(1) of the Act, every company without a share capital must at least once every calendar year make a return to the registrar stating:

• The situation and postal address of the registered office
• The situation and postal address of:
o The registrar of members;
o The registrar of debenture holders if not kept in the registered office
o Particular of directors and the secretary
o A statement of total indebtedness of the company.

Annextures to the Annual returns:

Under Section 128(1) of the Companies Act, the following documents must be annexed to the annual return.

• A copy of the balance sheet laid before the company in general meeting with its annextures.
• A copy of the directors report
• A copy of the auditors report

These copies must be certified a director and the secretary to be true copies of the original and if any of the documents is in a foreign language, a certified translation in English must be annexed. Failure to file returns renders the company and every officer in default liable to a fine not exceeding Sh.1000.

Time of making the annual return:

Under Section 127 of the Act, annual returns must be completed and delivered to the registrar within 42 days after the AGM for the year.

The copy delivered to the registrar must be signed a director and the co. secretary failing which the company and every officer in default are liable to a default fine.

Annual return of private companies

Under Section 129 of the Act, the annual return of a private company must be accompanied a certificate of a director and the secretary to the effect that the company has not from the date of incorporation invited the public to subscribe for its shares or debentures.

If a private company has more than 50 members, a director and the secretary must certify that the excess members are or have been employees of the company.

Note that:

If a company has issued share warrants, its annual return must contain the following additional information:

No. of shares comprising a warrant;
Number of shares in respect of which warrants are outstanding; Total number of warrants issued and surrendered to the company.

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