According resolutions for private companies has been detached. It

According
to the old Act, it is compulsory for incorporation to hold AGM
in once  year (SSM, 2017). However, the requirement for AGM for
private companies has been abolished under the . This means that when CA 2016 come into force effective on
2017, all private companies are not to hold
AGM in every year, except required by the constitution and either validly
required by any needed members (q3solutions,
2017). There is the different between the old act 1965 as all
meetings of private companies are known as meeting of associates in the act .
The  process for private companies can be
made done by the  resolutions. However, a
resolution to remove an auditor or a director before the expiration of his term
of office be passed as written (Kensington,
2017). On the other hand, public remains the
same that are to hold an AGM in every year (q3solutions, 2017).

The
changes in the new is important to ensure that the responsibilities of the
boards are run into the fiduciary duties. Also, the made in the CA 2016 is to
enhance the internal control, corporate governance as well (Nee. E, 2017). Formerly, shareholders have right,
thus it is to encourage the shareholders involved in the daily operational of
the company (Nee. E, 2017). The purposes of Act is to provide all the process and requirements
necessary for the smooth in succession of a company.

We Will Write a Custom Essay Specifically
For You For Only $13.90/page!


order now

Under the act of the, there are various rules
that have effect on the private companies. For instance, all the necessary progression and procedure has to
distribute separately such as the
selection of auditors or/ and director, lodgment of annual returns and the postponing
of audited financial statements, but irrelevant to the holding of an AGM for companies
(Zico
law, 2015). Besides
that, even though the they do not have the advantage of the forum of a general
meeting to discuss the board of directors on such statements, but they still
have a exact to obtain audited financial statements (Zico law, 2015). Furthermore, the obligation
of unanimous consent for members’ written resolutions for private companies has
been detached. It is compulsory to pass a transcribed resolution that is signed
by the compulsory majority of eligible associates (Zico law, 2015).

When the AGMs is
removed from the new rules and provision, it allowed private companies to diminish fee of burden
businesses. As it is not necessary to fee to appoint a company secretary at the
point of incorporation (Nee. E, 2017).  As the private companies
do not need to set up AGM, then all the decision can be made by transcribed resolution and the announcement for
the meeting can be directed through electronically (Nee. E, 2017). This can be clarified as the cost- effective
measures. Moreover, the elimination of
AGM for private companies that drive the positive impact is to observe the
entire progression and simplify the rules
relating to meet procedures as well as provides
flexibility in managing affairs of companies in order to have the efficiency
incorporation process and procedure (Isa.
A, 2017).