Directors’ Responsibilities

What are directors’ responsibilities? As a director, you are legally responsible for running the company. This must be done in line with both the articles of association and Companies Act 2006.

A key role is to ensure that all statutory reporting requirements are met. This includes, but is not limited to:

• Filing the annual accounts with Companies House by the deadline,
• Filing the tax returns with HMRC by the deadline, and ensuring this tax liability is paid,
• Keeping company records up to date and reporting any changes to the relevant body, and
• Maintaining accurate accounting and company records.

Third parties may be hired to manage some of these items day-to-day (for example, an accountant) however, the ultimate legal responsibility of the company’s records, accounts and performance remains with the director.

Other duties of a director include:

• Acting in the best interests of the company, in order to promote its success,
• Using your own independent judgement, and not allowing others to control your powers,
• Performing to the best of your ability, through exercising reasonable care, skill and diligence,
• Making other directors aware of any instances where you may personally benefit,
• Avoiding conflicts of interest, and
• Applying confidentiality about the company’s affairs.

Failure to uphold these statutory duties can have serious consequences, such as fines, prosecution or disqualification from being a company director.

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For more information or advice, contact your local Whitings office today.

Disclaimer - All information in this post was correct at time of writing.