Managing a company and its affairs is probably one of the hardest things to do. Based on the size and nature of a company, one single decision could impact the entire organisation in several ways, positively or negatively, based on how that particular decision pans out. This is why the shareholders of the company appoint directors (who constitute the Board) to look after and supervise the day to day operations and make relevant decisions as and when required. These decisions are made by passing board resolutions where the relevant issues are brought up during a Board Meeting, and based on the votes; the resolutions are passed.
1. Passing of the Board Resolution
A Board resolution merely certifies and documents a particular decision taken by the Board of Directors of a company. All the relevant decisions made by the Board are documented by the passing of the resolution for the same. However, for the passing of a particular resolution to stand valid, there are certain prerequisites which need to be satisfied:-
- The minimum number of directors must be present in order to constitute a Quorum.
- The resolution has to be passed on the letterhead of the company.
- The company files must contain the said resolution within 30 days of the Board Meeting.
- A chairperson will be appointed for the meeting.
2. Authorised Signatory and Opening a Bank Account
A distinct feature of companies is the fact that they operate as a separate legal entity in the eyes of the law. This means that the company can hold property in its own name. In light of this, the bank account of the company is usually opened in the name of the company itself. However, in order to carry on the regular functioning of this bank account, at least one authorised signatory needs to be appointed. The person appointed as the authorised signatory will require his signature to be provided for any bank-related work with regard to the company account moving forward.
3. Board Resolution Format
Download Board Resolution Format Here
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