Audit exemption extended
Ireland’s Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024 has been passed and signed by the president, but at the time of writing not all sections have been commenced.
These include a provision to allow a company to be late filing its annual return to the Companies Registration Office for one year in five and not lose audit exemption. The amendment is in Section 22 of the act, and it amends Section 363 of the 2014 Act.
In summary, audit exemption is lost for two years if the company files its annual return late and also filed late within the proceeding five years. Filing the company’s very first annual return late is disregarded, as is any failure to file an annual return prior to the commencement date of the specific section of the legislation.
In practical terms, this means that if a company filed an annual return late, prior to the commencement date, this would previously have rendered the two subsequent years subject to audit.
If a company gets its filing up to date, it gets a fresh start come commencement
In contrast, after commencement date, under the revised wording for the section, the company can disregard ‘a failure by a company to deliver its annual return before the (commencement) date’.
Therefore, under the new rules, the subsequent two years do not need an audit. This means that if, for example, the company was late every year up to the commencement date, and also late with the first filing after the commencement date, but subsequently was on time for all years, it will get audit exemption for all years after the commencement date. If the company is late for any two years in the first five after the commencement date, it will lose audit exemption for the two subsequent years after the second year that it was late.
The format for signing credit union financial statements has changed
Of course, prior to the commencement date, the old rules apply, and a return delivered to the registrar in the two years subsequent to a late annual return being submitted will be subject to audit.
The option to go to court to deem returns on time is still available. This is an attractive option where there are a number of years involved and the company has a reasonable excuse, as the cost of the court application is usually less than the late filing fees (before even factoring in the cost of multiple audits).
The new rule is generous in the sense that if a company gets its filing up to date prior to the commencement date, even though that may involve auditing a numbers of years accounts, it gets a fresh start come commencement and could avoid additional audits that could have arisen for two years under the old rules.
Credit union accounts
The format for signing credit union financial statements has changed. The original Credit Union Act 1997 required that the financial statements be signed by ‘the treasurer of the credit union, a member of the Supervisory Committee acting on behalf of the Supervisory Committee and a member of the board of directors acting on behalf of the board’.
The 2012 Act changed this to ‘the manager of the credit union, by a member of the board oversight committee acting on behalf of that committee and by a member of the board of directors acting on behalf of the board’.
DORA involves identifying the contingent plans for each critical ICT system
Finally, the 2023 Act changed this again to ‘signed by the manager of the credit union and by a member of the board of directors acting on behalf of the board’.
UNDP project office
The government has entered into negotiations to establish a United Nations Development Programme (UNDP) project office in Dublin. The proposed office will host the global secretariat for activities of the UNDP’s Financial Centres for Sustainability and the Sustainable Insurance Forum. In addition, it will support ongoing UNDP climate and nature finance policy efforts.
DORA
The Digital Operational Resilience Act (DORA) comes into effect in January 2025, making it a requirement for most financial services firms to document and test their operational resilience to cyber and ICT-related risks.
In summary, it involves documenting every system, identifying the critical ones, identifying the contingent plans for each critical system and then testing those contingent plans. A recent AB article goes into more detail about DORA.
A new ACCA guide for succession planning for insolvency practitioners is available
In a speech in November, Gerry Cross, director of financial regulation, policy and risk at the Central Bank, outlined the issues arising from DORA, including some background to implementation.
Crypto clampdown
The European Union (Markets in Crypto-Assets) Regulations 2024 has been passed and aims to regulate the issuance, distribution and trading of crypto-assets, as well as the provision of crypto-asset services. The Central Bank is designated as the National Competent Authority (Regulator).
Insolvency practitioner guidance
A new ACCA guide for succession planning for insolvency practitioners is available.
Small wins
Revenue is encouraging PAYE taxpayers to review their tax through myAccount and has issued guidance on how to do that. Accountants filing their own returns may want to check the details of some of the allowance and credits, which are frequently overlooked but can offer some tax savings. They include:
- Home Carer Tax Credit, where one spouse is at home looking after children or an elderly parent
- Rent Tax Credit, also claimable where a parent is paying rent for student accommodation
- Flat Rate Expense allowances, enjoyed by some categories of employment
- Health expenses at 20% after reimbursement by private insurance
- Remote working
- Third-level education fees; the disregard of €3,000 on this means that it is usually not applicable unless the taxpayer has multiple dependants at college.
