The Companies (Accounting) Act 2017
It’s what everyone in accounting is talking about. The Companies (Accounting) Act 2017 is bringing the Companies Act 2014 into line with new EU accounting rules. Stay ahead of the competition with our brief guide to these important changes.
The Companies (Accounting) Act was signed into law by the President of Ireland on May 17. It was enacted by the end of May and a subsequent commencement order (SI 246 of 2017) had the effect of bringing most of the provisions of the 2017 Act into force on June 9.
Section 80, which deals with certain filing and registration requirements for external companies), will commence at a later date.
Under the 2017 Act, all unlimited foreign incorporated bodies that are subsidiaries of limited liability bodies corporate, with a branch in Ireland, will be subject to certain registration and filing obligations. The main purpose of the 2017 Act is to transpose Directive 2013/34/EU on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings into Irish law. It also amends the Companies Act 2014.
The Act amends or inserts a number of areas in the Companies Act 2014, principally Part 6 of the Act which deals with financial statements. Section 15 amends Part 6 of the Companies Act 2014 by inserting a new Chapter 1A (sections 280A – 280H) which provides for the criteria for companies to qualify as “small”, “medium” or “large”, and introduces the new “micro” category of company. Micro companies are very small companies and can qualify for abridgement and audit exemptions if eligible.
It is hoped that the 2017 Act will reduce cost and simplify the procedure related to the preparation of financial statements for companies.
The 2017 Act also made a number of amendments to the Companies Act unrelated to the implementation of the Directive and addresses certain anomalies in the Companies Act.
Finally and in relation to non-filing structures, Section 1274 of the 2014 Act set out that unlimited companies must file financial statements where they fell under the category of a designated type company (Designated ULC). Irish unlimited companies where at least one member was unlimited and non EEA were not designated ULCs, therefore were exempt from filing financial statements with the Companies Registration Office (“CRO”) and could avail of filing a Special Auditors’ Report. Section 76 of the 2017 Act amends Section 1274 of the 2014 Act, whereby these previously “non-designated” companies, now fall under the remit of a designated company. This will have a hugely significant impact existing non-filing structures.
The 2017 Act makes it mandatory for Irish unlimited companies, (which are part of a non-filing structure, and which were previously exempt from filing financial statements), to file their financial statements with the CRO.
If you would like to discuss how UHYFDW can help you to comply with the Companies (Accounting) Act 2017, please contact our Corporate Compliance Manager, Richard Windrum.
Alternatively, you can speak to your usual UHYFDW contact, or complete the contact form on www.fdw.ie.