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CICP Compliance Checklist - RKH Accounting CC blog

Johannesburg, 9 December 2019 – The CIPC Compliance Checklist will be implemented by the CIPC from 1 January 2020.

The Compliance Checklist is applicable to all companies, including state-owned companies, non-profit companies, private companies, personal liability companies and public companies. The checklist currently does not apply to close corporations.

The CIPC has, as one of its functions, the monitoring of compliance with the Companies Act 71 of 2008 (“Companies Act”). As part of the monitoring the CIPC is implementing the compliance checklist. The CIPC states that the objectives of the Compliance Checklist are:

 

  • To ensure compliance with the mandatory requirements of the Companies Act;
  • To serve as an educational tool for directors and company secretaries, in guiding them with regards to their responsibilities in terms of the Companies Act;
  • To utilise the Checklist to monitor and regulate proper compliance with the Companies Act and, if trends of non-compliance appear, to act accordingly.

The Compliance Checklist comprises of 24 questions with “yes”, “no” or “not applicable” answer options. Companies are prompted to indicate if they complied with a particular section during the previous calendar year. The questionnaire does not allow respondents an opportunity to explain their responses. The CIPC has indicated that further correspondence regarding particular answers may be e-mailed to COR135.1complaints@cipc.co.za. (The CoR135.1 form is prescribed when reporting an alleged contravention of the Companies Act, but we understand that an e-mail submitted to the proposed address will reach the correct recipients at the CIPC.)

Companies will be required to complete the Compliance Checklist, prior to submitting their annual returns.

Who is responsible?

The Companies Act states that the business and affairs of a company must be managed by or under the direction of the board and the directors take responsibility for compliance with the Companies Act. Directors need to ensure that they are aware of their compliance obligations as the questionnaire only refers to sections of the Companies Act with no further detail or guidance provided on what the compliance requirement(s) in the relevant section is.

When completing the questionnaire companies are reminded that in terms of section 215(2)(e) a person commits an offence if they knowingly provide false information to the Commission and that if a person is convicted on an offence they could be liable to a fine, imprisonment not exceeding 12 months or both a fine and imprisonment in terms of section 216(b).