Your share register tells the story of who owns what in your company. Yet this crucial document often gets treated like forgotten gym membership – filed away until someone asks uncomfortable questions at the worst possible moment.
Picture this: You’re in a crucial funding round, investors are ready to write cheques, then someone asks to see your share register. What should be simple becomes a three-week archaeological dig through emails and spreadsheets.
The biggest mistake? Thinking your share register is just paperwork. South African company law requires every company to maintain an accurate, up-to-date share register. Failing to comply results in penalties and serious legal complications.
The Real Impact: When potential investors conduct due diligence, a missing or inaccurate share register raises immediate red flags, screaming “unprofessional management.”
The Fix: Appoint someone responsible for maintaining it and set up systems for immediate updates after any share transaction.
We’ve all seen it – that Excel file with seventeen versions, each claiming to be “FINAL.” Someone updates Version 12 while others work on Version 8, and nobody knows which is accurate.
The Chaos:
The Fix: Invest in proper share register software or work with professionals who have systems designed for this purpose. Your share register should be a single source of truth.
Share transfers without proper documentation are like verbal contracts – fine until someone disputes them. Every transaction needs proper documentation: transfer forms, board resolutions, updated certificates, and regulatory filings.
Real Consequences:
The Fix: Create standard processes for all share transactions with documentation checklists. No exceptions, no shortcuts.
Share certificates are legal proof of ownership, not participation trophies. Companies often issue certificates without updating registers, or update registers without issuing certificates.
The Problems:
The Fix: Implement certificate management systems linking directly to your share register.
Company law, tax implications, and regulatory requirements around share registers are complex and constantly evolving. Going DIY often creates more problems than it solves.
Hidden Costs:
At Cosecly, we understand that share register mistakes compound over time. That small Year 1 error becomes a Year 3 crisis requiring expensive intervention.
We utilise a cloud based software that records share registries online, verifies and records changes and offering a sole record of the ownership of your company. Sounds simple, but its crucial.
Every investor, acquirer, or lender examines your share register first. It sets the tone for everything that follows. A clean, professionally maintained register signals competent management. A messy one suggests hidden problems.
Your share register isn’t just a legal requirement – it’s a fundamental business tool affecting everything from tax planning to exit strategies. Companies that get this right save enormous headaches and costs.
At Cosecly, we help businesses implement professional share register management from day one. Don’t let share register mistakes be the reason your next opportunity slips away – your future self will thank you for getting it right today.