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Share Transactions

Overview

This article details the different types of share transactions that can be recorded within a company's share register. Use these processes to build and maintain your share registers.

Contents

1. Balance check

2. Issue shares

3. Sale of shares

4. Share Split

5. Buyback

 

Balance check

You may see share transactions showing as "Balance checks" with an extra notification when the transaction is selected. This is likely because the share register has not been edited since the company was set up.Balance_check.png

If you believe the balance check is a good starting point for building a new share register then simply issue the shares using the "Convert to Issue" option in the cogs menu. It will then become an editable share transaction. Alternatively you can remove the record completely and start building a new share register. 

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Issue of shares

To record the shares allocated when the company was incorporated, navigate to the Overview page, select "I would like to..." and click "Issue shares to new allocation".

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Add person by searching for the name under existing contact, select the class of shares being issued, record the number of shares being transferred and the transaction date, then hit Create.

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Repeat this process to issue shares to all shareholders of the company when it was first incorporated. If the same person has two separate class shares, you can repeat the process again to allocate shares to them from the other share class.

You can check you have allocated the shares correctly by going to the Allocations tab and clicking on the person you just added. Here will be able to see the share transaction you have just created. e.g. Simon Jones - 50 A class shares.

 

 

Sale of shares

In the case of shares being transferred from one shareholder to another, the best place to record that share transfer is in the Allocations tab.

1. Place a tick next to the person that the shares are being transferred from

2. Click on the cogs and select "transfer shares to new".

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Note - In the "Record transfer of shares" form, you will see that the Shares being transferred from has been locked. This prevents errors in selection.

Sale to a person:

If the shares are being transferred to a person already associated with the company search for the person in the existing contact section or go to other person to add them in.

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Sale to a company:

If the company purchasing the shares is a client of your firm, they may already have a Connectworks profile - check here first using the existing contact tab.

If the company doesn't appear using the existing contact search, new NZ companies can be added through the NZ company tab or if the new organisation is an international company, enter their details in the Other organisation tab.

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Sale to a trust:

Add each trust party individually and Update the Parcel name as the name of the trust.

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Once the new shareholder(s) is added, select the class of shares, record the number of shares being transferred, transaction date and hit Create.

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Viewing Sales:

The sales can be viewed on the Transactions page, within the transfer filter. It will be displayed as Sale of *number of shares* by *name of person or organisation being transferred from*. Selecting one of the sales will allow you to view who the shares were transferred to, under the transaction details as the receiving party.

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You can also view the change on the Overview page, the allocation of shares are displayed under top shareholding.

Transfer information can also be viewed from the Compliance report.

Overview page -> I would like to…-> Compliance report s87(1),(2)(b,c)

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Share Split

To record the split of shares for a company, navigate to Overview -> I would like to…-> Split shares

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Select share class, record split ratio, date of split and hit create.

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This will change the overall share count and number of shares held by each shareholder according to the split ratio you selected.

 

Buyback of shares

In some cases when a shareholder is removed from a company, instead of transferring their shares to another shareholder, they can sell their shares back to the company.

To do this, navigate to Overview-> I would like to…-> Buyback shares (retained as treasury stock)

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Select the shareholder that is selling the shares back to the company, share class, record the number of shares being re-purchased and the date of transaction.

If you tick the ‘cancel the shares on repurchase’ option then the company gets rid of the shares altogether, if this option is not ticked then the shares will remain within the company as treasury stock and can be sold to shareholders in the future.

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