Ultimately, you have managed to muddle through all the process for your company incorporation in Malaysia, and your business is finally set up. The next thing you need is to appoint suitable and qualified staffs to help you run the company. The foundation of any company is laid on 4 main pillars, which include the directors, shareholders, auditors and a company secretary.
A company secretary is mandatory for any public listed or private limited companies here which is a part of legal requirement under the Companies Act 1965 and every company must appoint at least one secretary.
Eligibility of a Company Secretary
As it is a legal requirement in Malaysia for companies to hire a company secretary, there are several qualifications to be a company secretary here.
Pursuant to the Malaysian law under the Section 235 of the Companies Act 2016, a company must have at least one company secretary who is a natural person of 18 years old and has a principal or place of residence in Malaysia. He or she must also possess at least one of the qualifications below:
- A chartered accountant who is registered under the Malaysian Institute of Accountants (MIA).
- A chartered secretary who is registered under the Malaysian Institute of Chartered Secretaries and Administrators (MAICSA)
- A licensed secretary who is licensed by the Company Commission of Malaysia to be a company secretary
- A lawyer who is registered with Malaysian Bar or any relevant authorities
Another important qualification that a company secretary must observe is that he or she must not be bankrupt and is not convicted of any offence under Section 130 of the Companies Act.
Since it is required by law, having a company secretary is of utmost importance and the role should not be taken lightly which is why you should seek someone who is completely trustworthy and reliable.
Responsibilities of a Company Secretary
The duties and responsibilities of a company secretary have evolved rapidly in the past years in Malaysia. A company secretary is no more viewed as a mere admin assistant that they used to before. They are now regarded as an important element in every company and needed to ensure a smooth running of the company. Company secretaries are constantly relied upon by the rest of the management in the company.
These days, it is not easy to be a company secretary as there are myriad of roles and duties for a company secretary to uphold.
The company secretary has several responsibilities which include:
- As an officerforthe company and an advisor to the Board
- Ensuring compliance with Statutory Requirements and Advisory
- Preparation of board meetings and as liaison between shareholders and the company
- Filing of annual returns and full accounts in a timely manner.
- Ensuring the safe custody of company seal
- Primary point of contact for institutional and other shareholderswith regards to matters of corporate governance
Factors to consider when hiring a Company Secretary
While adhering to the regulations set by Malaysian Companies Act, below are few factors to look into before appointing a company secretary.
- Well versed with Malaysian Company Law
Make sure that you appoint a person who knows the laws the regulation. This factor has great importance and cannot be compromised, as the laws and regulations are wide and complex, hence you will surely need someone who is well versed with the rules and regulations promulgated by the Companies Act. A company is required to observe all rules and regulations mandated under the Companies Act and there are number of responsibilities associated with this.
A company secretary should possess in-depth knowledge of Malaysia Companies Act and all of the annual requirements. The company will be penalized if the authority did not receive the company’s annual report or filing and it is the responsibility of the company secretary to ensure that the company abide by the rules. This is why the secretary should have rich knowledge and preferably experience in the local jurisdiction to avoid any compliances offence.
- Possess appropriate qualification and experience
An ideal secretary is someone who has acceptable knowledge and experience as this role requires fair exposure to the recent statutory corporate governance and compliance requirements.
- Have excellent communication skills
The company secretary usually acts as a communication channel between directors, shareholder and is solely responsible in facilitating the Annual General Meetings (AGM) and board meetings. Hence, it is only rationale is the secretary have excellent communication skills in order to liaise with them. Company secretaries also serve invaluable advisory role, given their extensive knowledge of legal practices and compliance frameworks as well as the company’s internal governance. They are often relied on for their advices and act as a communication channel for the directors and shareholders relating to the formulation of strategies or any decision-making process.
- Adequate organization and administrative skills
Given the wide range of roles and responsibilities of a company secretary in Malaysia, there are multitude of administrative tasks that must be undertaken by the secretary. Most of the company’s official documents and registers are handled by the secretary. The secretary mainly deals with all filing matters and are responsible to file any statutory changes and updates of changes in capital share structure. In other words, they are considered as a bookkeeper of the company. Other filings such as annual returns and financial report are also done by the secretary along with assisting in drafting and execution of official contracts, agreements and board resolutions.
Apart from that, a company secretary is in charge of preparing the agenda for AGMs and board meeting, scheduling, preparing notice to shareholders, and recording the meeting minutes.
- Possessesfinancial analytics skills
As a company secretary also deals with the financial aspect of the company, it is only rational that the secretary has an above average familiarity with finance. Therefore, it is no wonder that public accountants are most qualified to be a corporate secretary.
Some knowledge and sense in finance will be handy in supervising the company’s share allotments, reviewing the financial statements and reports, as well as vetting the tax assessments.
It is imperative that a company hire a company secretary not only because it is a legal requirement, but a competent and trustworthy secretary will make sure all legal procedures are followed as well as making sure there are no breaches of rules and regulations. A failure to adhere to these legal compliances will result in severe consequences for your company, hence opting for the right corporate secretarial services is essential to the smooth running of your company.
Paul Hype Page & Co. will give you more information and assistance on policy updates, compliance regulations and changes to tax conditions. Corporate tax in Malaysia.
Our team of seasoned professional can also help you set up a company in Malaysia very quickly and easily following all legal entities, and offer you sound advice on how to make it successful too.
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- Malaysia Tax Planning
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IRB (Inland Revenue Board) governs Malaysia’s tax system, helps develop a stronger economy, better environment and a more vibrant economy. All companies, regardless of industry, have a legal duty to pay taxes.
Malaysia attracts investments from around the world by reducing its corporate income tax rate and introducing different tax incentives. Malaysia has one of the lowest corporate tax rates in the world.
As your company’s Tax agent , Paul Hype Page & Co Chartered Accountant will be fully responsible for the practice of ensuring that these conditions are met. It is important that we be highly qualified and well versed in local regulations and corporate laws, as we are responsible for the upkeep of important company files, tax reports and tax records.