Niall Collins (Limerick County, Fianna Fail)
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592. To ask the Minister for Jobs, Enterprise and Innovation the reason there is a provision in the Statutory Audits Bill 2017 to changes section 343 of the Companies Act 2014 regarding district court applications for late filing; and if she is considering removing this proposal in the final Bill, which removes the audit exemption for small companies with a view to minimise the disproportionate regulatory burden on such businesses. [15477/17]

Mary Mitchell O'Connor (Dún Laoghaire, Fine Gael)
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The General Scheme of the Companies (Statutory Audits) Bill was approved by Government on 17 January 2017 and published on 16 February 2017.   Head 167 of that Scheme proposes to amend section 343 of the Companies Act 2014.

Section 343 obliges companies to make an annual return to the Companies Registration Office.  Companies have a period of 9 months from the end of their financial year to prepare and file their annual returns. Where a company fails to meet that deadline, it loses the audit exemption.  

Since the introduction of the withdrawal of the audit exemption for failure to file on time, the rate of compliance with filing deadlines has increased from 13% to 90%.  This increase in compliance was one of the reasons why the Company Law Review Group recommended no change to the loss of the audit exemption when it reviewed the provision in 2011. 

Section 343 introduced the option for a company to apply to the District Court or the High Court for an extension to its annual return date.  In 2016, 1,201 such applications were made to the District Court and 29 to the High Court. Of these, 957 applications were granted with the remainder refused, withdrawn or adjourned.

The option to apply to the courts replaced what had been an administrative scheme where a company could apply to the Registrar of Companies for an extension. Under that administrative scheme, a consequence of any extension was the loss of the audit exemption.

Head 167 of the General Scheme of the Companies (Statutory Audits) Bill proposes to reinstate the situation whereby a company loses the audit exemption if it is granted an extension to its annual return date.

The General Scheme has been submitted to the Office of the Parliamentary Counsel for drafting into a Bill. It will be a matter for the Oireachtas to decide the final provisions of that Bill.