Article by: Lonehill Accountant: Jean Claude Marais
Do I need to have an Accountant compile my Annual Financial Statements
The necessity to compile Annual Financial Statements has been a topic of debate between both business owners. The main argument is the cost-to-benefit analysis described by the International Federation of Accountants.
The first point that needs to be considered is the legislative requirements of the Companies Act 71 of 2008. Section 30 determines that a company must prepare Annual Financial Statements annually, within six months after the financial year-end. This results in a company registered in accordance with the Companies Act should compile annual financial statements.
Further to the matter, a company must have at least one shareholder, therefore the issue of no-par value shares to the shareholder should be disclosed on the Annual Financial Statements and recorded in the Share Capital Account. With this consideration, even dormant companies have a disclosure obligation to users of the Financial Statements.
Incorporation expenses would also be included according to IAS38 and IAS26. This adds more disclosure requirements for dormant companies.
We can, therefore, conclude that every company registered under the Companies Act should compile Annual Financial Statements to remain compliant with the Companies Act 71 of 2008.
To contact Jean Claude email jean-claude@bluespan.co.za or visit his website: www.bluespan.co.za
