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Directors heal thyself!

Posted in Category(ies): Directors

How often do Directors assess themselves?

Directors rightly expend huge efforts on reviewing company procedures, financials, HR, management, etc but, how many Directors spend time thinking about the individual Directors of the Board?

 It is trite but, true to say the more effective the Board the more effective the Company. 

 Individual Directors should consider how issues such as those outlined below may impact on them personally, and the Company professionally.  They should ensure there are checks in place to monitor and react should such issues be triggered for any person during their tenure as Director.

o   Longevity – have Directors been in place so long their thinking has become staid?  Are individuals continuing to add value in their personal capacity as Director?

o   Attendance – do individual Directors have a good attendance record at Board Meetings?  S.148 Companies Act 2014 states that the office of director shall be vacated where “the director is for more than 6 months absent, without the permission of the directors, from meetings of the directors held during that period”.

o   Number of directorships – a person may not be a director of more than 25 companies.  Directors of Groups should not panic, S.142 Companies Act 2014 outlines circumstances of how a Director of a number of companies within a Group may count such directorships as one. 

o   New Directors – are they checked out before appointment?  The Companies Act 2014 imposes various restrictions on individuals including individuals serving bankruptcy terms, disqualification or restriction.  What catches people out here is that such restrictions for the most part apply regardless of jurisdiction. 
 

Register of Disqualified / Restricted persons – average figures for disqualification are around 3,500 individuals with average figures for restriction around 940 individual Directors.  The Register of Disqualified and Restricted persons in Ireland can be accessed for free on the Companies Registration Office website

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Posted on by | Kathryn-Maybury

Charities Regulator launches first guidance documents to help charities

Posted in Category(ies): Charities

The Charities Regulator launched the first in a series of guidance documents on 21st July. These are aimed at encouraging and facilitating the better administration and management of charities. The documents address the issues of guidance for trustees and internal financial controls guidelines for charities.

 “The publication of the first of these guidance documents is an important landmark in the development of the Charities Regulator,” CEO John Farrelly said. “While our key functions include the creation and maintenance of the Charities Register and ensuring that charities are in compliance with the Charities Act, we are also tasked with encouraging and facilitating the better administration and management of charities.”

The trustees’ guidance document covers the minimum trustees should be aware of as well for those considering joining a board. To read the Guidance for Charity Trustees click https://t.co/e5T4ssk9Vh.

The internal financial control guidelines for charities document is practical and covers the main areas of financial control for charities: income; expenditure; banking (including payments and loans); assets and investments; and monitoring arrangements. It contains a number of useful checklists for organisations to ensure they have the appropriate controls in place. The Internal Financial Controls Guidelines for Charities can be read by clicking https://t.co/JiFcdtLBaf.

The Charities Regulatory Authority are expected to publish additional guidance documents before the end of the year which will include registration, winding down, conflict of interest and fundraising.

The guidelines are not yet prescriptive, however, when regulations are in place, Charities will be expected comply with these guidance documents

 

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Posted on by | Van-Geraghty

Electronic Filing

Posted in Category(ies): Electronic Filing

Electronic Filing

The Companies Registration Office (CRO) introduced electronic filing a number of years ago but, since 1st June 2017 the CRO introduced mandatory electronic filing for:

–          B1 (Annual Return)

–          B2 (Change in situation of Registered Office)

–          B10 (Change in particulars of Directors/Secretary)

–          B73 (Change of Annual Return Date)

–          Financial Statements

 

Electronic filing makes sense but, the imposition of a 5mb limit (around 20 printed pages) on the size of Financial Statements is proving problematic.  It will be interesting to see how companies, practitioners, and accountants deal with the technological challenge of complying with the 5mb limit. 

 

Hopefully, implementing electronic filing during the summer months will give all involved the ability to iron out issues before peak filing of Annual Returns, and Financial Statements hits in the autumn

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Posted on by | Kathryn-Maybury

Simplified financial statements for small businesses

Posted in Category(ies): Financial Statements

On the 17th of May the President signed into law the Companies (Accounting) Bill 2016 which is now known as the Companies (Accounting) Act no 9. of 2017. The Act simplifies the financial statements requirements for small businesses in Ireland which will hopefully assist these small and mirco companies to flourish. Companies will be able to opt for financial statements commecing 1/1/16 to be ‘simplified’.

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Posted on by | Kathryn-Maybury

Charity Corporate Health Check

Posted in Category(ies): Charities

Charity Corporate Health Check

We are closing off Ireland’s “Trustees Week” with a Corporate Health Check specifically prepared for Charities.  

 

These questions can be used as an indicative test of Corporate Governance for your Charity.  You may not know all the answers or any of them, but do ask questions. Check with your Company Secretary, Statutory Auditors or Accountant who will be happy to help.

 

1. Charities Regulator’s Register of Charities – is your charity registered with the Regulator.

2. Registered Office – is your charity’s registered office is correctly noted in the Companies Registration Office.

3. Charity Trustee/Director – are you recorded as a Director / Trustee with the Companies Registration Office and the Charity Regulatory Authority.

4. Books and Records – are your Charity’s Statutory Registers, Board, board sub-committee and general meeting records held at the registered office.

5. Accounting Records – is the Charity using a “competent and reliable person” such as an independent accountant to maintain accounting records? The charity should be able to measure its financial position with reasonable accuracy at any time.

6. Board Meetings – is the Charity maintaining Board minutes? Minutes must contain names of those present, in attendance, meeting proceedings and note any resolutions passed. The Minutes must also be signed by the Chair.

7. Annual General Meetings – members must be issued with a notice of a general meeting and provided with a copy of the financial statements prior to an AGM.

8. Companies Registration Office Annual Return – are they being filed on time?  If your Charity is a limited company, it will have an Annual Return Date and is obliged to submit an Annual Return within 28 days of this date to the Companies Registration Office.

9. Charity Regulatory Annual Report– all charities (regardless of size) must submit an Annual Report to the Charities Regulatory, within 10 months after the end of each financial year and depending on the size, should also include the financial accounts.

10. Financial Benefits of being a Charity Trustee – as a Charity Trustee, by law you may not profit from carrying out your duty as a trustee. You cannot accept a salary specifically for acting as a charity trustee nor receive another benefit (with the exception of being reimbursed for reasonable expenses carrying out your duties).

 

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Posted on by | Van-Geraghty

Irish companies are now legally obliged to maintain a new Company Register – the Register of Beneficial Ownership

Posted in Category(ies): Company Registers

Irish companies are now legally obliged to maintain a new Company Register – the Register of Beneficial Ownership

In November last year part of a new EU Regulation came into effect in Ireland (The European Union (Anti-Money Laundering: Beneficial Ownership of Corporate Entities) Regulation) which had the immediate effect of requiring Irish companies to create, maintain and keep up to date a new Company Register – the Register of Beneficial Ownership. This Register must include at least the following information with respect to every beneficial owner of the company:

–       name;

–       date of birth;

–       nationality;

–       address;

–       statement on the nature and extent of the interest held; and

–       date on which a person becomes or ceases to be a beneficial owner.

Does this new legislation apply to our company?

In most cases the answer to this question will be yes (there are certain exceptions e.g. Irish companies that are already subject to disclosure requirements such as those listed on a regulated market or trust structures do not have to have a Register of Beneficial Ownership).

What is a Beneficial Owner?

In general terms, a beneficial owner is any person owning or controlling an interest of 25% or more in a company, whether directly or indirectly. The Regulations require directors to identify a natural person, not a corporate or other body, who holds an interest in the relevant entity at this level.

What if I don’t know who the Beneficial Owner is?

Ignorance is not bliss! Companies are obliged to take certain steps to establish the beneficial owners but there are provisions to include the details of senior management of the company in the Register if the beneficial ownership details cannot be established despite these steps.

My company is part of a group and the ultimate beneficial owner is the same for each entity in the group – can we have just one Group Register?

No! The Regulations do not provide for a group exemption. Accordingly, each relevant entity within a corporate group must establish its own Register, even when the ultimate beneficial owner of all the relevant entities in that group is the same.

What happens if I do nothing?

Failure to comply with the obligations under the Regulation is a criminal office and any relevant entity or individual that commits such an offence could be liable for a fine of up to €5,000 on summary conviction.

Will the details in this Register become public?

For many companies this is a primary concern and unfortunately one which no long term definitive answer can be given. The Regulations derive from the 4th EU Anti-Money Laundering Directive which is expected to be implemented in full in Ireland in the next few months. Once implemented it will result in the establishment of a central register of beneficial ownership which is to be controlled by a new registrar – the Registrar of Beneficial Ownership of Companies & Industrial & Provident Societies.

Exactly who shall have access to this central register has yet to be determined. The Directive gives member states the discretion on the extent of accessibility of the central register and at the moment there are no indications that this central register will be immediately available to the public. Interestingly however, in the UK their central registers are accessible to the public. The extent of public access is a very contentious aspect of the new Regulations and KomSec will keep you updated on exactly what happens with regard to access this summer and into the future.

Can KomSec help me comply with this new legislation?

Absolutely. Just contact us and we can ensure your Register of Beneficial Ownership is compiled and maintained in accordance with this new legislation and any future requirements of the new Registrar of Beneficial Ownership of Companies & Industrial & Provident Societies.

 

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Posted on by | Kathryn-Maybury

New Digital Certificates to replace Paper Certificates

Posted in Category(ies): Digital Certificates

From the 8th of June, 2017 Certificates of Change of a Company Name and Re-Registration of Company Type will no longer be issued in paper form but instead will be “digitally certified” documents. This means companies will now receive these certificates as a pdf document with the advantage that these digital certificates can be easily provided to third parties (e.g. banks) who might require them.

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Posted on by | Van-Geraghty

Watch Out! Annual Returns (including Financial Statements) must now be filed electronically

Posted in Category(ies): Electronic Filing

As part of a drive by the Companies Registration Office to electronically file as much documentation as possible, the following documents must now be filed electronically in the Companies Registration Office:

– Form B1     Annual Return

– Form B2     Notice of Change in Registration Office

– Form B10   Notice of Change in Director or Secretary or their Particulars

– Form B73   Nomination of New Annual Return Date

The most important e-filing change relates to the Annual Return, as from the 1st of June the only means of filing a B1 form and Financial Statements and paying for annual returns is in electronic form. It is no longer possible to file paper versions of these documents in the CRO.

KomSec expects that filing Financial Statements may catch some companies out as to date the vast majority of Irish companies (approx. 90%) have been filing paper versions of these documents. That is no longer possible and companies must ensure that their financial statements are capable of being filed electroncially. Teething problems have already started, with KomSec involved in a case where the CRO e-filing system was simply incapable of accommodating a large file containing financial statements.

The good news is that these changes will eventually benefit everyone as e-filing will mean better administration by the CRO ensuring greater transparency, effectiveness and hopefully reduced backlogs.

KomSec is delighted that the CRO has finally caught up with us as we have been electronically filing in the CRO for our clients for years!

 

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Posted on by | Kathryn-Maybury

Statutory Auditors – Real or Imagined!

Posted in Category(ies): Auditors

It seems obvious but, in reality how many companies actually check their Statutory Auditor is entitled to act as an Auditor?

Although not prolific in number, there are some hard core individuals that persist in holding themselves out as Statutory Auditors even though they are not entitled to act in such a capacity.  The difficulties for companies who, albeit unwittingly, retain such individuals can cause various problems, and serious financial loss.

For example, a company files its Annual Return(s) with what it believes to be properly Audited Financial Statemens attached.  It is subsequently found out the individual who prepared the Financial Statements had criminally held himself out as a Statutory Auditor when not entitled to do so.

Result – the company paid an individual to carry out an Audit which is found to be invalid, and the company must now retain an authorised Statutory Auditor to re-do the job incurring an additional set of fees.  A double whammy you may think but, no – it is a triple whammy and why?

Audited Financial Statements are filed in the Companies Registration Office with a Company’s Annual Return.  Where those Financial Statements have been prepared by an unauthorised Statutory Auditor the Company must re-file and the Annual Return is deemed to have not been filed at all thus exposing the Company to probable payment of penalty late filing fees.  Talk about rubbing salt into the wound.

The Director of Corporate Enforcement successfully took a case in April 2015 against one of those hard core offenders resulting int he individual being found guilty of having acted as an Auditor when already disqualified from doing so, and producing false audit reports.

To ensure your Company does not get caught out unwittingly take five minutes to check the Companies Registration Office.  Go to the Audit Search Facility on their website (www.cro.ie) where you will find detials on firms, indivduals names, Auditor Registration Number, and recognised Accountancy Bodies.  Still in doubt?  Then contact the Accountancy Body and look for another Auditor!

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Posted on by | Kathryn-Maybury