Disclosure requirements are becoming more and more extensive …..
Section 30(4) of the Companies Act 2008 requires the annual financial statements of every company which is required to have its annual financial statements audited in terms of the Act, to disclose remuneration received by each director of the company; or each individual holding any prescribed office in the company.
This disclosure requirement extends to those companies that are required by the Regulations to have their annual financial statements audited.Â Companies that voluntarily choose to be audited and companies subject to independent review, are not required to provide disclosure of directors’ remuneration. They could nevertheless do so voluntarily, or their MoI’s could provide for such disclosure.
“Remuneration” for the purposes of section 30(4) and (5) is defined in section 30(6).
S30(6) states “For the purposes of subsections (4) and (5), “remuneration” includes-
- fees paid to directors for services rendered by them to or on behalf of the company, including any amount paid to a person in respect of the personâ€™s accepting the office of director;
- salary, bonuses and performance-related payments;
- expense allowances, to the extent that the director is not required to account for the allowance;
- contributions paid under any pension scheme not otherwise required to be disclosed in terms of subsection (4)(b);
- the value of any option or right given directly or indirectly to a director, past director or future director, or person related to any of them, as contemplated in section 42;
- financial assistance to a director, past director or future director, or person related to any of them, for the subscription of options or securities, or the purchase of securities, as contemplated in section 44; and
- with respect to any loan or other financial assistance by the company to a director, past director or future director, or a person related to any of them, or any loan made by a third party to any such person, as contemplated in section 45, if the company is a guarantor of that loan, the value of-
- (i) any interest deferred, waived or forgiven; or
- (ii) the difference in value between-
- (aa) the interest that would reasonably be charged inÂ comparable circumstances at fair market rates in an arm’s length transaction; and
- (bb) the interest actually charged to the borrower, if less.”
The references to “future” director” have received much criticism in the past and it remains unclear how far ahead the “future” needs to be anticipated.
The requirements relating to a prescribed officer is similar to that of a director.