What is an Annual General Meeting?
An Annual General Meeting (AGM) is an annual gathering of the company’s shareholders and board of directors. The company’s directors provide an annual report to shareholders at an AGM that details the company’s performance and strategy. AGMs are mandatory under the Companies Act, 2013 to be held to discuss annual results, the appointment of auditors, and other matters. To organize the AGM, a company must adhere to the regulations outlined in the Companies Act, 2013. Section 96 states that every company other than a one-person company shall hold a general meeting in each year in addition to any other meetings. The full form of the AGM is the Annual General Meeting. It is essential that the interval between two Annual General Meetings (AGMs) not exceed 15 months. However, it is worth noting that the initial Annual General Meeting (AGM) of a business has the flexibility to be scheduled on any day within 18 months after the firm’s incorporation. Annual General Meetings provide members with valuable insights into the company’s plan for improvement under the current rate of growth.
The Annual General Meeting (AGM) provides valuable insights into the strategic decisions and actions that have contributed to the company’s success, as well as those that have resulted in financial losses. This helps both the members and the board in determining the subsequent steps to be taken. It is important that an Annual General Meeting (AGM) be conducted exclusively on a business day. In the event that the government officially designates a public holiday on the scheduled day of the meeting, the participating members will regard it as a regular working day. However, AGM cannot be held on a national holiday. The venue for the annual general meeting may be designated as the registered office of the firm.
Difference between Annual General Meeting (AGM) and Extraordinary General Meeting (EGM)
Meetings are one such arrangement where both shareholders and office bearers of the company come together to discuss business and non-business agendas. This makes sure that neither shareholders nor the office bearers make any decisions about the company by themselves, which could jeopardize the operations of the company. The Companies Act has provided regulations regarding management and arrangements in cases of Annual General Meetings (AGM), which are held at least once a year to discuss ordinary business agendas, and Extraordinary General Meetings (EGM), which are held on the requisition of members to discuss urgent matters.
Table of Content
- What is an Annual General Meeting?
- What is an Extraordinary General Meeting?
- Difference between AGM and EGM
- Conclusion
- Frequently Asked Questions (FAQs)
Contact Us