Indications from the government suggest that the Companies Act 2014 may commence:

1. “for financial statements approved on or after 1 June 2015”,
2. financial statements “ending after 1 June 2015” or
3. financial statements “beginning after 1 June 2015”.

Originally, 1) was indicated as the Government’s first preference; however, it would appear that some legal issues have been identified with this option, which would now indicate that 3) might be the most viable option currently. Of particular concern to auditors is the availability of the audit exemption status for small groups and companies limited by guarantee. Using 3) above will postpone audit exemption for two more years.

Company conversion to benefit from audit exemption

In the intervening period, law practitioners and accountants alike are looking at the possibility of converting companies limited by guarantee and particularly property/owner managed companies to companies limited by shares. This can now be achieved under new provisions in the 2014 Act after 1 June 2015. The benefit of such conversion may then allow these companies to get audit exemption early if the Act is commenced based on accounting periods “beginning after 1 June 2015” as opposed to accounting periods “approved after”.

What Questions Do You Have?

We are happy to help. Please post your comment below or call Des McCann, Partner at Cooney Carey, on 01 677 9000. Alternatively, send him an email: dmccann@cooneycarey.ie

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