Michael Moynihan (Cork North West, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

77. To ask the Minister for Enterprise, Trade and Employment if he will review the loss of the audit exemption on late filing by the Companies Registration Office which is placing a significant financial burden on small businesses; and if he will make a statement on the matter. [63302/21]

Robert Troy (Longford-Westmeath, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

In recognition of the burdens on small business, company law was amended in 1999 to provide audit exemption for those companies who meet their filing obligations. These long-standing provisions have been, and continue to be, of significant benefit to compliant companies. There is a considerable incentive on companies and their advisers to ensure timely filing of annual returns, thereby safeguarding the audit exemption and avoiding late filing penalties and possible prosecution.

Against this background, there has been a very significant increase in the compliance rate for the filing of annual returns, moving from a widespread culture of non-compliance up to the 1990s to a situation, in recent years, where in the region of 90 - 95% of companies meet their filing obligations on time.

The question has been raised about the potentially disproportionate effect that the loss of audit exemption may have, particularly in relation to SMEs, as a consequence of late filing (due to the costs associated with providing two years of audited financial statements). My Department keeps company law under review on an ongoing basis and is considering what changes might be appropriate to the current regime to ensure that the consequences of late filing do not unduly penalise small business while also maintaining the incentive to file annual returns in a timely manner.