Template Description
The resolution addresses the reversal of funds mistakenly transferred to the company's current account instead of the designated share application account, ensuring compliance with proper procedures. This template is a 2-page MS Word document. It is designed for companies that need to reverse funds transferred due to a miscommunication in the share application process. The document is customizable to reflect the specific details of any company. The intended audience includes company directors, company secretaries, and legal professionals.
Understanding a Board Resolution for Reversal of Share Application Money
Terminologies:
1. Board Resolution: A formal decision of the board of directors that is recorded and documented in accordance with the Companies Act 2013.
2. Share Application Money: Funds received from potential shareholders before allotment of shares.
Procedure for Reversal of Share Application Money:
Convene a Board Meeting:
Schedule a meeting of the Board of Directors.
Ensure a quorum is present for passing the resolution.
Convene the board meeting at the registered office of the company.
Approval for Reversal:
Pass a resolution authorizing the reversal of share application money transferred to the company's current account due to miscommunication.
Approve the transfer of funds back to the share application account.
Authorize a Director:
Authorize one of the company’s directors to coordinate with the bank to facilitate the transfer.
Empower the director to act on behalf of the company and do all necessary actions related to this process.
Documentation: Ensure the resolution is recorded in the board minutes. 4.2 Provide a certified true copy of the resolution to the bank and relevant authorities.
Conclusion
This board resolution formalizes the company’s decision to reverse the share application money transferred due to an administrative error. By clearly authorizing a director to act on the company’s behalf, this resolution ensures the proper handling of funds in accordance with legal and financial protocols. Having a well-documented resolution is crucial for ensuring transparency and compliance with banking procedures and company policies.