Heather Humphreys (Cavan-Monaghan, Fine Gael) | Oireachtas source

The Bill is designed to enhance enforcement with new powers, for instance, adding to standards, to issue directions to accountancy bodies. Most of the key changes on audit in the Bill are aimed at improving audits of public interest entities which are usually big companies.

Deputy Danny Healy-Rae mentioned several issues. One of the protections for small businesses is having access to information, financial and otherwise, on the companies they supply and do business with. They need to know that they are doing business with a company that is financially sound. It removes some of the risk when they can see that companies are financially sound and the likelihood is that they will honour any commitments into which they have entered. That is one reason the Bill addresses timely filing by companies with the proposed changes to the loss of audit exemption. We want companies to file their accounts on time.

To respond to Deputy Fitzmaurice, almost all small companies in Ireland qualify for the audit exemption. This Bill does not change that so there is no additional cost. The Companies (Accounting) Act 2017 simplifies financial reporting obligations for small companies and raises the threshold so that more companies qualify for the audit exemption and the reduced reporting regime.

The thrust of this section of the Bill is to get companies to file their accounts within the ten-month time limit from the end of the financial year. We do not want companies running late so that when they submit information, it is historic and of no use to anyone. That is the purpose of the relevant part of the Bill. Prior to the legislation passed in 2015, the Companies Registration Office, CRO, granted 497 waivers in 2014. When it went to the District Court there was 1,200 applications of which 1,109 orders were granted for late filing. In 2017, there were 1,067 applications of which 832 applications were granted. The numbers of those not filing accounts on time increased significantly. All we are asking is for them to file their accounts on time. They continue to have an audit exemption.

The Bill avails of several options which could not be taken in secondary legislation. The cumulative aim of these options is to improve audit quality. These will only be of use once the Bill have been enacted. I hope that we can bring the Bill through this House efficiently and I look forward to Members' continued engagement on this important legislation. I am happy to work with everyone to produce the best possible legislation that will provide both the necessary oversight and protections with minimal burden on small businesses.

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