ADVERTISEMENTS:

Minutes of board meetings : its meaning and contents

Minutes are a gist of the proceedings of a meeting. They constitute a summary, as distinguished from reports, of the proceedings of a meeting. Discussion that preceded the adoption of a resolution may be material for a report but the decisions in the shape of resolutions are material for the minutes. An accurate record of minutes provides an invaluable proof of the proceedings specially if the company is used in law courts on any matter for which resolution was passed at a meeting.

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According to Section 193 of the Act every company must keep minutes of the proceedings of Board meetings or of every committee of the Board in books kept for that purpose within 30 days of the conclusion of the meeting. The pages of the minutes books must be consecutively numbered and in no case there should be attached by pasting or otherwise any extra page. Each page of every such book shall be signed and the last page of the record of proceedings of each meeting in such books shall be dated and signed by the Chairman of the meeting or the Chairman of the next succeeding meeting.

Although the minutes require no approval from the directors before they are signed by the Chairman, it is customary to read the minutes for approval at the next Board meeting, and to get them signed by the Chairman after they have been approved by the Board. It will be noticed that confirmation of the minutes of the last meeting is invari­ably an item of agenda in Board meetings.

ADVERTISEMENTS:

The Section further provides that the minutes of each meeting shall contain a fair and correct summary of the proceedings thereat and all appointments of officers made at such meeting shall be included in the minutes of the meeting. The minutes must also include the names of directors present at the meeting and the names of the directors, if any, dissenting from the resolution passed at the meeting. However, the chairman shall enjoy an absolute discretion in regard to non-inclusion of any matter in the minutes which in his opinion is defamatory of any person, is irrelevant or detrimental to the interests of the company.

The minutes of meeting kept in accordance with the above provi­sions are prima facie evidence of the proceedings recorded therein (Sec. 194), and the meeting to which such minutes relate shall be deemed to have been duly called and held, the proceedings threat to have duly taken place and the appointments of directors or liquidators made at the meeting shall be deemed to be valid, until the contrary is proved (Sec. 195).

It may be added that the minutes once made and signed by the Chairman cannot be altered or corrected (Re Cawley & Co.). If any correction is necessary another resolution must be passed. Further, only directors and auditors are entitled to inspect the minutes of Board meetings. The auditors have a statutory right of access to the minutes of Board meetings and a provision in the articles precluding such a right would be invalid (Newton vs. Birmingham Small).

Contents of minutes of board meetings :

The Board meeting minutes should contain the following:

(i) Name, place, date and time of the meeting.

(ii) Names of the directors present and also the names of the persons in attendance, viz., the secretary, solicitor, etc.

(iii) Name of the person who took the Chair.

(iv) Granting of leave of absence.

(v) Confirmation of minutes of the previous meeting, and Com­mittee meetings, if any.

(vi) Various items of the agenda discussed at the meeting along with resolutions passed thereat.

(vii) Names of directors, if any, who dissented from the resolution or who were personally interested in any matter before the meeting.

(viii) Date of next meeting.

(ix) Vote of thanks.

(x) Chairman’s signature with date in his own hand.

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