One of the big changes in the new Companies Act
is that while it applies to all companies, from one-man companies to large multinationals, some only need to have independent reviews, while others don't need to have their financial statements checked at all, says the Tax Bulletin
That's why SAICA recently surveyed small and medium accounting firms on their views following the promulgation of the Companies Act.
Weigh up the pros and cons of independent reviews and audits…
Despite being eligible for an independent review, many actually elected to have an audit instead, due to the amount of work involved in an independent review.
So if your company has a Public Interest Score between 100 and 350 and you want to exercise your option to have an independent review, don't even think of starting this task yourself.
SAICA says you'll need to appoint an independent accounting professional to have your financials independently compiled and reported.
Becausei t's not an easy task. One small mistake could cost your company thousands or still expose you to an audit, says the Tax Bulletin
Just remember that if you go this route, the cost of having independently compiled financial reports together with the cost of an independent review will probably be more than the cost of a voluntary audit.
If you're focusing on your Companies Act responsibilities, don't forget the most important one…
You only have until 30 April to get Your Memorandum of Incorporation in place, reminds FSP Business
Your Memorandum of Incorporation is a legal document that sets out the rights, duties and responsibilities of shareholders, directors and others within a company that'll help you avoid disputes between shareholders and directors.
With it, and your company might not even need a financial record audit, says Michaelsons
So get your Memorandum of Incorporation in place, then see if you need to conduct an independent review of your accounting records – it's the easiest way to comply with the new Companies Act!