Considerations on the romanian regulations of 'censors', an institution between tradition and actuality

• Author: Mirela Georgiana Sabau
• Pages: 280-289

CONSIDERATIONS ON THE ROMANIAN REGULATIONS OF „CENSORS”, AN

INSTITUTION BETWEEN TRADITION AND ACTUALITY

Lecturer Mirela Georgiana SABU

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Abstract:

This essay analyzes the institution of “censors”, as company body of internal control, aiming to determine

whether this institution corr esponds or not to a real need of some companies or it is just maintained in the virtue of

the tradition of Romanian law system regulations rega rding the internal control. Analyzing the evolution of

company contr ol a nd the institution of censors a nd especia lly the la rge attributions, rights a nd obliga tions the

censors have, tha t are more e xtended than those of the auditor s I ca me to the conclusion that the censor s by their

permanent and general activity corr esponds to rea l needs of some companies. Therefore I consider that there are

real grounds for which the institution of censors, part of the traditional system of interna l control provided in the

course of time by the Romanian law system, c ontinues to exist. In the final part after ana lyzing the existing legal

provision I suggested some amendments of the law such as : to request expertise of the persons nominated as censors

in order to avoid a formal and inefficient control, to extend the secret vote for censors election a s provided for

companies by shares to all companies, to eliminate the obligation of the limited company by shares having more than

15 shar eholders to nominate censors if such company enter into contra ct with auditors, as well a s some suggestions

regar ding the corr elation of the terminology.

Key words: company law, control of company management, censors, auditor s, interna l control of companies

JEL Classification: K20

By the fulfillment of the formalities for company establishment and by observing the

formal and substantial conditions imposed by the law, the company is transformed from a

contract into a legal person having its own capacity and decision that is obtained as a result of the

law and the will of company founders.

Its quality of subject of law and the double nature of contract and legal person, essentially

defines the company, with all the consequences that derives from it and affects company own

patrimony and the mechanism of adopting and implementing the company decisions, of the

obligations and liability of the persons empowered to transpose company will in the relationship

with third parties.

Company will is formed within the general meeting of shareholders and is accomplished

by the administrators (managers) liable for the performance of company day to day activity under

the supervision of the company bodies or persons who exercised company control.

The control of company management is aiming to prevent situations that might conduct to

the infringement of company articles of incorporation and memorandum of association, abuses in

directors and managers activity or of other company bodies, company bankruptcy, the decrease of

company patrimony and other similar.

The activity of the control body and the control function assure the protection of the

shareholders interest, as well as the interest of the company itself.

In the course of time, worldwide there were two main company control systems: internal

control system and external control system.

The internal control system considers the control as a function within the company and

therefore it states against the interference of persons outside the company with issues related to

the company control. The internal control system pleads for the control exercised by a company

body (censors or censors committee) formed by one or more persons who might be shareholders

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Mirela Georgiana Sabu, Faculty of Law, Spiru Haret Bucharest University, Lawyer in Bucharest Bar,

mirela.sabau@mfplawyers.ro