Companies are required by law to keep proper accounts which give an accurate view of their financial affairs. The Companies (Amendment) Act (1986) - the European Communities (Companies: Group Accounts) Regulations (1992), and the European Communities (Accounts) Regulations 1993, are the main legislative texts regulating accounting issues in Ireland.
EU law dealing with professional integrity, independence and qualifications of corporate auditors was implemented in Ireland by the Companies Act 1990.
The requirement that a company keep proper books of account is contained in section 202 of the Companies Act 1990.
You must also keep full and accurate records of your business for tax purposes.
You must keep your records for a period of six years unless your Inspector of Taxes advises you otherwise.
The Irish Auditing and Accounting Supervisory Authority (IAASA) supervises Irish accountancy bodies and monitors that the accounts of certain listed entities comply with legislation.
Invoicing and Inventory
The rules applicable to invoices and inventory are contained in the Companies Act 1990.
Certain rules apply to invoicing also for the purposes of Value Added Tax (VAT).
Public limited companies and private limited companies must prepare and file annual accounts with the Companies Registration Office (CRO) in accordance with the Companies (Amendment) Act 1986.
Public companies with limited liability which are not trading for the acquisition of gain must prepare and file accounts with the CRO in accordance with the Companies Act 1963. A private limited not-for-profit company has no obligation to file accounts with the CRO.
Certain unlimited companies and partnerships must also prepare accounts and deliver them to the CRO. Such specific cases are detailed by the European Communities (Accounts) Regulations 1993.
Small-sized companies may be exempted from certain requirements for annual accounts if during the relevant year and the year prior to that the company satisfied two of the three following conditions:
- Balance sheet total not exceeding € 4.4m;
- Turnover not exceeding €; 8.8m;
- Number of employees not exceeding 50.
Medium-sized companies may be exempted from certain requirements for annual accounts if during the relevant financial year and the year prior to that the company satisfied two of the three following conditions:
- Balance sheet total not exceeding €7.62m;
- Turnover not exceeding €15.24m;
- Number of employees not exceeding 250.
Auditing, disclosure and publication
Companies have to disclose details of their accounts at their Annual General Meeting (AGM) and attach a copy to the Annual Return filed with the Companies Registration Office (CRO).
In addition, they have to observe certain standards when preparing accounts, following certain formats and disclosing certain information by way of notes to the accounts.
Directors of all companies are generally required to present the following accounts and reports to company members at the AGM:
- A profit and loss account (or an income and expenditure account if the company is not trading for profit);
- A balance sheet;
- A directors' report;
- An auditor's report.
The annual accounts and directors' report must be signed on behalf of the directors by two directors.
The documents above must be submitted with the Annual Return to the CRO (section 7 of the 1986 Companies Amendment Act) (Small and Medium companies have certain exemptions). In addition, there must be a certificate, signed by both a director and the secretary, certifying that the accounts and reports are true copies of those laid before or to be laid before the company's AGM.
If a company fails to comply with the requirements of section 7 of the 1986 Act, the annual return will be rejected by the CRO. In addition, the company and every officer of the company who is in default will be liable for a fine not exceeding €1,905.
You must prepare the first Annual Return within six months of the date of the company's incorporation on the register. At this stage you do not need to annex the accounts, but they must be attached to all subsequent annual returns (except in the case of private unlimited companies).
An Annual Return can be completed on-line.
Enterprise Ireland is the government agency responsible for developing and promoting Ireland's business sector. Its mission is to accelerate the development of world-class Irish companies to achieve strong positions in global markets.
The Office of the Director of Corporate Enforcement provides information on the responsibilities of companies, company directors and/or secretaries under the Companies Acts, under secondary legislation and related case law.
The website of Business Access to State Information and Services (BASIS) was created in 2000 as part of the Irish Government Action Plan 'Implementing the Information Society in Ireland'. Its aim is to provide government information and services to business 24 hours a day, seven days a week.