Redenominating Share Capital

Key Points

An ordinary resolution must specify the new currency, exchange-rate method and effective date. The rate may be a stated-date spot rate or an average over a specified period. The effective date is the resolution date or a later stated date. Existing dividend and voting entitlements remain unchanged. File the notice through Update shares information; ACRA lists no fee and seven working days for processing.

Document the Currency Conversion Before Notification

As practical preparation, record the existing currency, the proposed currency and the share capital affected before drafting the ordinary resolution. Redenomination changes currency denomination while maintaining share value; it is not an issue of additional shares or a reason to rewrite existing voting and dividend entitlements. Check that the resolution describes the actual conversion.

Choose the exchange-rate method explicitly. A spot-rate method needs the specified reference date; an average-rate method needs the specified period. Keep the rate calculation with the resolution so that the capital figures entered in the filing can be checked against it. ACRA permits optional conditions in the resolution, so identify whether any stated condition must be fulfilled before the chosen effective date.

The effective date can be the resolution date or a later date stated in it. Do not select an earlier date merely to align with an accounting period. After the resolution is passed, an officer or CSP uses Update Shares Information and selects Redenomination of Shares. Review the submitted currency and date against the approved resolution. ACRA lists no filing fee and seven working days for processing; that period describes the service and should not be substituted for the effective date stated in the resolution.