Mr. Brendan Murtagh:

I represent the Association of Chartered Certified Accountants, ACCA, a global body for professional accountants. The ACCA supports 219,000 members and 527,000 students in 179 countries. We support 12,000 members and 8,000 students in Ireland. The association was invited to make a submission to the committee on the Bill. In that submission we identified that it was a limited scope amendment to old legislation and our comments are limited to the matters being amended.

We identify two substantive issues the committee should consider and some minor technical amendments. Overall, we welcome the Bill as it will serve to reduce the administrative burden for industrial and provident societies. The first substantive issue is that industrial and provident societies should be required to prepare financial statements in accordance with generally accepted accounting practices, GAAP, similar to the requirements in companies legislation. The requirement for an annual return is substantially undermined if the financial statements attaching to the annual return are non-standard. The Minister should be given the power to prescribe the form and content of financial statements for industrial and provident societies by way of regulation. There is no evidence of abuse in the area but we have anecdotal evidence from our membership of different approaches being adopted for disclosure by various industrial and provident societies. This leads to a lack of comparability and potential obfuscation of details that might be important to the shareholders. Prescribing a set of rules to follow, as is done in company legislation, will ensure consistency.

The second substantive issue is that audit exemption should be available to industrial and provident societies on a similar basis to companies limited by guarantee. This will serve to reduce the administrative burden for the smallest industrial and provident societies while also allowing any single shareholder to demand an audit.

A more technical concern is that section 14A(2) does not appear to be linked to section 14A(1). The subsections will allow the Minister to grant exemption from public filing of annual returns and financial statements for certain classes of industrial and provident societies. The exemption under section 14A(1) should be available only where the generality of section 14A(2) is met. The two subsections need to be linked and the committee should consider changing "may" to "will", thereby requiring the Minister to provide an alternative when he or she provides an exemption rather than making it optional.