Maintaining and keeping records
Disclaimer | The information provided here is general information and is to be used as a guide only. You should consider getting advice from a qualified professional adviser who will take your particular circumstances into account to tell you how the law applies to you & your company.
The Companies Act requires every company to keep and maintain certain records.
- Company records (described in section 189);
- Share register (described in section 87); and
- Accounting records (described in section 194).
These requirements are described in detail as follows.
- Company records
- Share register
- Accounting records and appointment of auditors
- Security interests
- Annual meeting
- Adopt, alter or revoke a constitution
- Issue of shares
- Distributions to shareholders
Note | Many small businesses choose to have their accountant, solicitor or business advisor hold and maintain these records for them.
Section 189 Companies Act 1993
A company must keep a variety of documents at its registered office, including the constitution, minutes of shareholders and directors meetings, financial statements and accounting records and the share register.
Notwithstanding the general requirements to keep these records at a company’s registered office, the records may be kept at another location in New Zealand provided the location is notified to the Registrar ten working days in advance.
Sections 87–94 Companies Act 1993
A company must maintain a share register that records the shares issued by the company and which states:
- whether there are any restrictions or limitations on their transfer; and
- where any document that contains the restrictions or limitations may be inspected.
The share register must also record:
- an alphabetical list of the shareholders' names with residential addresses or registered office; and
- number of shares held.
Note | The list should include both current shareholders and those who have been shareholders within the last ten years).
The register must also show the date of share issues, repurchases, redemptions and share transfers.
An agent (such as a professional share registry) may maintain the share register of any company.
Subject to a company’s constitution, a share register may be divided into two or more registers and kept in different locations. A notice of the location of each register must be delivered to the Registrar within ten working days after the share register is divided.
The share register, if undivided, is the company’s principal register and must be kept at its registered office. If divided, the share registers may be kept elsewhere.
Transferability of shares – Shareholders may sell or otherwise dispose of their shares at any time (subject to any restriction imposed in the company’s constitution).
Accounting records and appointment of auditors
Sections 194 and 196 Companies Act 1993
Every company must prepare financial statements annually. These must be audited unless all shareholders in the company agree otherwise (auditor resolution). If an auditor is to be appointed, the appointment is made at each annual meeting. There are some companies that must always appoint an auditor (those that are required to file financial statements under the Financial Reporting Act 1993).
The board of a company must ensure that the company keeps accounting records. These records must:
- correctly record and explain the company’s transactions;
- at any time enable the financial position of the company to be determined with reasonable accuracy;
- enable the directors to ensure that the company’s financial statements comply with the Financial Reporting Act 1993; and
- enable the company’s financial statements to be readily and properly audited.
Historically, companies legislation required companies to maintain a register of charges. This was replaced with the introduction of the Personal Property Securities Act 1999, although it would be considered good practice for companies to maintain details of security interests they have granted.
Security interests over personal property (for example, secured loans, leases or hire purchases) can be registered and searched on the Personal Property Securities Register (PPSR) online at www.ppsr.govt.nz. Note | You must be a registered user of the PPSR website to search the PPSR.
A search of the PPSR for any registered security interests in respect of a specific company can also be conducted via the Companies Register at www.companies.govt.nz
Every company must hold an annual meeting of shareholders once in each calendar year.
Generally, the meeting must be no later than 10 months after the company’s balance date and no later than 15 months after the previous annual meeting. A company does not have to hold its first annual meeting in the calendar year of its incorporation, but must hold that meeting within 18 months of incorporating.
Adopt, alter or revoke a constitution
The shareholders of a company without a constitution may adopt one by special resolution. Shareholders may also alter or revoke a constitution by special resolution. The board of a company must ensure that notice of an adoption, alteration or revocation is filed with the Registrar within ten working days.
Issue of shares
After incorporation, a company must issue to any person named in the application as a shareholder, the number of shares that the application says the shareholder will receive.
After the first issue of shares, the board of a company may issue shares at any time, to any person, and in any quantity it sees fit. This power is subject to the provisions of the Act and any provisions in a company’s constitution that may modify its right to issue shares. The Registrar must receive notice of the issue of shares within 10 working days.
Distributions to shareholders
The board of a company may authorise a distribution by the company at any time, and of any amount, and to any shareholders it sees fit. But before doing so, it must:
- be satisfied, on reasonable grounds, that the company will be able to satisfy the solvency test immediately after the distribution
- ensure that it does not breach section 53 of the Act, or any provision in its constitution relating to distributions.
Directors approve a distribution must sign a certificate stating that the company can satisfy the solvency test and give the grounds for that opinion. A company satisfies the solvency test if, after the distribution, the company:
- is able to pay its debts as they become due in the normal course of business; and
- the value of the company’s assets is greater than the value of its liabilities, including contingent liabilities.
Filing of documents
As noted above, some of this information must also be recorded and maintained with the Companies Office. Interaction with the Companies Office is predominantly through the use of online services. For the small number of instances where there is no online service available, there are forms available for filing documents at the Companies Office.
The majority of transactions for New Zealand companies are now completed online.
- To update or maintain any company details with the Companies Office you will need to be logged on as a registered user of the website.
Read more about registering as a user
- For most services you must also have Company Authority.
Learn about Company Authority - the system that is used to authenticate online transactions.
For the occasional instances where no online service is available, you can download forms from this website.
Once completed forms should be mailed to the Companies Office along with the appropriate fee (if any). The address is on the forms.
How long are you required to keep company financial records?