Commercial companies must hold their general meeting within six months following the end of their financial year.. The opportunity for Michel Delbast, Absolute partner, to emphasize the importance of this legal formality, which certainly allows compliance with a legal obligation, but above all to protect yourself in the event of future economic or relational difficulties.
The general meeting designates the time when the partners or shareholders meet to make important decisions in the life of the company. If the exercise is perfectly practiced in large or medium-sized companies, VSEs must also ensure that they respect the formalism. The general meeting is the opportunity, for all business sizes, to sit down and take stock of your strategy. A general meeting is being prepared. Even if the manager’s management report is no longer mandatory for “small” companies – what we can regret (these are companies not exceeding two of the following three thresholds : total number : 4 million euros, turnover : 8 million euros, effective method : 50 employees), it is strongly recommended to write one. Indeed, its development will require the management team, or the manager in small businesses, to make the effort to transcribe the significant economic events of the past year, to explain them, and to reflect on the directions for the current year. Traditionally, the general meeting must, a minima, validate the accounts for the financial year, executive remuneration, decide on the possible distribution of dividends… Ordinary general meetings must be held within six months of the end of the financial year, i.e. June 30 for financial years ending December 31. Extraordinary general meetings, which can be summoned at any time, are essential for all decisions relating to the modification of the statutes or the operating rules. A certain formality must be respected, depending on the legal form of the company, regarding the notice period, the possibility of being represented, the number of, etc.
Exempting “Covid” provisions
It is interesting to know that the exceptional rules linked to the epidemic have been extended by decree until July 31, 2021. Voting by correspondence is made easier and recourse to written consultation of partners is made exceptionally possible. Be careful though, a meeting may only be held behind closed doors if, on the date of the convening of the meeting or that of its meeting, an administrative measure limiting or prohibiting travel or gatherings for health reasons prevents members of the assembly from being physically present.
“Turning in” for the future…
In very small businesses, the “bosses” often see holding a general meeting as just one more administrative constraint and botch the thing, do not always respect formality, or do not keep proof. As with everything, as long as everything is fine, AGM minutes stay warm at the bottom of a cupboard ! Yes, but, until… For example, until the manager gets angry with the friend to whom he had given 2% to justify the creation of his SARL. And there, the good friend, he is looking for all possible “noises” for him. And scratching everywhere, he unearths the shortcomings of general assemblies. In court, it will be extra points for him, and so much hassle for the manager. Another unfortunately common example : until the company is in difficulty. In court, if the manager cannot prove that his accounting, ses AG, etc. are “squared”, he could be accused of “mismanagement”, which, let's remember, “breaks down” the boundary between professional and personal assets. Clear, he will be likely to have to repay the debts of his business with his own funds. Suffice it to say that every business leader has an interest in paying the greatest attention to preparation, for the holding and minutes of its general meeting. He may usefully seek advice from his accountant if the latter is involved in the preparation of his annual accounts..
