Companies gamble with investors' assets

As a shareholder, just how confident can you be that the executives of the company in which you have placed your money will work to look after your best interests? Not confident enough, if the results of a survey released this week are anything to go by.

These show that 12 per cent of publicly quoted companies in the Republic have failed to file annual returns with the Companies Office for more than two years, an alarming 3 per cent are more than three years tardy and a staggering 2 per cent are more than six years behind with their returns.

Staggering? At 2 per cent? Well, yes, when you consider that, under company law, a company which has failed to file returns two years after they were due can be struck off the register. If that were to happen, they would no longer have limited liability and their assets would become the property of the Minister for Finance. How would you like to wake up one day and find the share you thought you owned in a company was now snuggling in the minister's hands simply because the executives running the company had failed to carry out the most basic of their duties?

Last year, only 58 per cent of medium and large businesses surveyed filed returns. When small companies are included, only 34 per cent meet their responsibilities and only 16 per cent filed their returns on time.

When you consider that a previous survey by the same group, Interface Business Information, the credit information specialists, showing that 65 per cent of companies which never filed returns fail, it is a salutary reminder to investors, and indeed traders, to check carefully before placing their trust in outwardly reliable companies.