Does your Irish Company Require an Audit?
Subsidiary AuditsA frequent question we receive from international clients is in relation to what group and local Audit requirements apply for their Irish subsidiary or stand alone companies. We work with several large international groups to provide group and local audit services to those Irish subsidiaries.
Do I need an audit?The common initial question we are asked is whether the Irish company can avail of audit exemption due to its size. Where the company is a standalone company then this is to be considered under the Small company Audit exemption. Where the Irish company is a subsidiary or where there are a number of Irish companies (forming a sub group) then this would be an intermediate parent of the group and would need to consider the small group audit exemption:
Small Company Audit ExemptionIn order for an Irish registered company to qualify for the small company audit exemption the company must satisfy TWO or more of the following conditions in the current financial year and in the preceding financial year (unless it is its first financial year):
- Balance sheet total does not exceed €6m
- Turnover does not exceed €12m
- Number of employees does not exceed 50
The look through - Small Group Company Audit ExemptionHowever even if the individual subsidiary company qualifies as a small company, where it is part of a group then it must also consider whether it can avail of the small group company audit exemption. Thus, it is a ‘look through’ position and where the subsidiary forms part of a larger group it may still require to be audited. Audit Exemption applies to any group company if the group as a whole qualifies as a Small Group. The entire group and all its subsidiary undertakings must, taken as a whole, satisfy two of the following 3 conditions in order to claim a Group Company Audit Exemption. The conditions must be met in the year and also in the preceding year unless it is the holding company’s first financial year):
- The balance sheet total of holding company and subsidiaries taken as a whole does not exceed €6m net (or €7.2m gross)
- The amount of turnover of the holding company and subsidiaries taken as a whole does not exceed €12m net (or €14.4m gross)
- The average number of persons employed by the holding company and its subsidiaries does not exceed 50.
ContactAs many international groups now have Irish entities within their structures they should consider their local Irish Audit and Advisory needs and whether our specialist subsidiary audit services could work for them. With our services you have a professional and dedicated Audit team with local knowledge and international experience from a contactable team. We ensure that the local statutory audit and financial statements requirements of the subsidiaries are completed and filings maintained. For an initial meeting or discussion, please contact: Aidan Scollard FCA Partner and Registered Auditor - Roberts Nathan Email firstname.lastname@example.org Office + 353 1 876 4550 Mobile +353 86 25 23 026 The content of this blog is intended to convey general information and educational advice. It should not be relied upon as professional advice. We have done our best to ensure that the information provided by Roberts Nathan is accurate and up-to-date but unintended errors or misprints may occur. If you wish to obtain business advice or taxation advice please do not hesitate to get in contact with a member of our team.
June 7, 2022
How SCARP Helps Small Companies Settle Debts with Creditors
SCARP, the Small Companies Administrative Rescue Process is a restructuring process similar to the Examinership process in Ireland, used to restructure companies in, or facing financial distress. Examinership, whilst it has saved thousands of jobs over the last thirty years, is expensive and complex for many small and medium sized companies. SCARP is the government’s response to the need to provide a restructuring process that is cost effective and more accessible to micro, small and medium sized companies. Its introduction is timely, as we emerge from Covid-19 many businesses are facing difficult and uncertain trading conditions. With government Covid-19 supports now tapering off, the commencement of repayment of warehoused tax liabilities, the impact of the war in Ukraine, increased energy costs, raw material shortages and labour supply issues, businesses are now heading towards what one might consider a perfect economic storm. Whilst the indications are ‘the economic headwinds’ will be short lived; companies and businesses will have to weather these storms and unfortunately some will not survive. SCARP provides a restructuring tool that will allow companies to restructure their debts whilst continuing to trade. The restructuring plan once finalised and agreed with creditors becomes legally binding. Key considerations Who is SCARP available to: SCARP is available to companies where:
- Turnover does not exceed €12 million.
- The balance sheet total does not exceed €6 million.
- The average number of employees does not exceed 50.
- be unable or is likely to be unable to pay its debts.
- not be in liquidation or have a receiver appointed.
- have not used the process or had an examiner appointed in the last five years.
- The process is led by a qualified Insolvency Practitioner (IP). The IP will be appointed as Process Advisory (PA) and will be tasked with formulating a rescue plan for the company.
- The process will have a defined timeline lasting up to 70 days.
- There is no automatic court protection from creditors once a company enters the process. The PA can seek this court protection once appointed.
- A rescue plan is approved when a 60% majority in number and a majority in value of one class of creditor approves the scheme.
- There is the ability to repudiate onerous contracts (e.g. leases).
- State debt is classified as ‘Excludable Debt’. Essentially the state creditors (e.g. Revenue) has the option to opt out of the process. It has 14 days from the giving of notice to opt out, if there is no objection within that timeframe, Revenue may be included in the rescue plan.
- A rescue plan may require additional investment in the company. There is the ability to fund the plan over a period of time, subject to the approval of creditors.
- The PA is obliged to report to the Officer of the Director of Corporate Enforcement (‘ODCE’) on the historical conduct of the directors of the company.
May 17, 2022
Company Registers – What You Need to do
Having seen a recent an increase in new company incorporations with many companies having been incorporated post Brexit by UK parent groups we are receiving more queries around the legal requirements around the statutory books to be maintained for these companies. Company registers are the official books kept by a company relating to legal and statutory matters and are often referred to as the statutory registers, combined registers or company books. There is a legal obligation under the Irish Companies Acts for every company to have and maintain their company registers which is a responsibility of the Company Secretary. Failure to keep the registers correctly is a category 3 offence by the company and every officer of it who is in default. The company registers are however often overlooked and not reviewed and updated on a regular basis. It is often only when there is a possible sale or a dispute within a company that the registers can suddenly become a priority which can lead to delays and issues between parties.
Company saleQuestions about the whereabouts of the company registers and their status usually arise when a company is to be sold and the purchaser requests the registers in order to conduct the company secretarial due diligence as part of the sale process. If the company registers have not been properly maintained, they will need to be reconstituted prior to the sale. Even if the registers were maintained, they should be reviewed as part of the pre-sale company health check to ensure that they correctly reflect the current position of the company to avoid unnecessary complications during the sale process. If there are any deficiencies that cannot be remedied, the purchaser may require the seller to indemnify the purchaser for any loss they may suffer due to the statutory registers not having been properly maintained. We frequently see that transactions in relation to the share capital of the company or changes in company officers have not been kept up to date in the registers of the company.
What are the registers each company must have?Under European Legislation and the Companies Act 2014 there are seven mandatory statutory registers required to be maintained by all companies incorporated under the laws of Ireland. These are:
- Register of Members pursuant to Section 169 of the Act
- Register of Directors and Secretaries pursuant to Section 149 of the Act
- Register of Directors' and Secretaries' Interests in Shares or Debentures pursuant to Section 261 of the Act
- Register of Directors' Service Contracts pursuant to Section 154 of the Act
- Register of Directors' Interests in Contracts pursuant to Section 231 of the Act
- Register of Instruments creating Charges pursuant to Section 414 of the Act
- Register of Ultimate Beneficial Ownership pursuant to Article 30 of the 4th EU Anti Money Laundering Directive
Register of membersThe most important register is the register of members. The register of members shows past and present members and is evidence of who the current members of the company are and the number and classes of shares they hold. This information is vital for conducting company meetings and passing resolutions, especially in companies with large numbers of members or where members change frequently. It helps to ensure that all decisions are taken properly and to avoids decisions made to be challenged in the future. If there is a dispute in relation to the company’s shareholding, the Court will ask to see the register of members as evidence of who the existing shareholders are.
Inspection and location of the registersThe registers should be kept at a company’s registered office address or its principal place of business or another place within the State. The registers shall be open to inspection by any member of the company without charge. The members of the company are also entitled to request a copy of the registers and a copy of the minute book of the members' meetings. It should also be noted that any other person may also inspect the register of members, directors and secretaries and disposable interests and request a copy of those registers (for a small fee). The registers can be kept in paper or electronic format.
Rectification of company registers by Court OrderAs mentioned above any person has a right to request to view the registers of a company. If a person’s name is omitted from the register or entered without sufficient cause or the registers were not updated to reflect that a person ceased to be a member, the aggravated person may apply to the court for rectification of the register. The Court may then order rectification of the register and payment by the company of compensation for any loss sustained by any party affected. If the company was sold, the seller could also face a claim for breach of warranty and associated damages in respect of the cost to the company and the purchaser. It is important to note however that a company can rectify its registers without a Court Order. As soon as any omission or error has been identified, the company registers should be rectified.
How we can helpThese issues highlight the importance of maintaining the company registers in good order which reflect the current company position from the outset when a company is first incorporated. How Roberts Nathan can help – we can review and assist in an overall health check on your company registers and where necessary carry out a reconstitution, or rectification of the registers. If you would like to discuss the above you can contact Aidan or email us at email@example.com Contact Us
May 3, 2022
How To Minimise Your Tax Liability As A Business Owner
We know that tax is a significant variable facing business owners, which is why we invest heavily in experienced, highly qualified tax advisors. Our team works with a wide variety of clients in businesses across various industry sectors to meet tax compliance obligations and provide beneficial tax strategies to all types of business owners. In today's blog, we wanted to look at some simple methods for lowering your tax liability as a business owner. Taxes, like any other expense, can be controlled and lowered with our proper planning and guidance. Cashflow and money will always play a significant part in the potential success for any business so ensuring proper compliance and setup will be crucial for you. The Revenue Commissioners will always get their percentage from your personal and company wealth, but, here are some methods to help you minimise your business's tax obligations and reduce your tax liability as a business owner.
Methods to reduce tax liabilities as a business owner
- Maintain systematic record
- Tax credit
- Finance capital expenses for tax exemptions
- Engage your spouse or any other family member
- Change your company's accounting reference date
- Preliminary tax
- Travel and subsistence
- Consider turning into a Limited Company
- Generate management accounts before the end of the year
July 14, 2021
Roberts Nathan featured in the Business Plus July edition
Our Managing Partner Vivian Nathan speaking to the Business Plus July 2021 edition. Vivian shares his views on how Brexit has been a boost for Roberts Nathan.
July 5, 2021
Business in Ireland
Setting Up a Company in Ireland F.A.Q’s
What are the basics I need to know? Before they became clients of ours, many business owners had the following questions they needed answers to when considering setting up a company in Ireland. As a result, we have decided to answer the most frequently asked questions we regularly receive.
- What do I need to consider when registering for a VAT number in Ireland?
- Is it possible to set up a business bank account as a non-resident and what’s required?
- How long does it take to register a limited company?
- What are those documents?
- A copy of your passport
- Proof of address
- What paperwork is required to be filed annually for this company?
- Are the company directors required to be residents in Ireland?
- Do I need a company secretary?
- How do I get a postal address in Ireland, do I really need it?
- How much does this all cost?
May 13, 2021
Roberts Nathan featured in the Business Plus March edition
Our Managing Partner Vivian Nathan speaking to the Business Plus March 2021 edition. Vivian shares his views on activity levels, remote working, business supports and enterprise.
March 10, 2021
Do you help international companies enter new markets?
Join Aidan Scollard, Partner at Roberts Nathan, who in conjunction with Soft Land Partners will be speaking to professionals who help international companies enter new markets at this free online event taking place on Thursday 4th February from 4-5pm. Register your attendance by clicking here.
February 1, 2021
CRSS and the Construction Industry
The two most important schemes available to employers and businesses across the country at this time are the CRSS (Covid Restrictions Support Scheme) and EWSS (Employment Wage Subsidy Scheme). Under the current CRSS guidelines, the construction industry is not permitted to make a claim under CRSS as they do not satisfy the guidelines whereby they operate from a fixed premises that is required to prohibit or considerably restrict customers from accessing their premises. They may still be eligible to claim the EWSS wage subsidy. To learn more about this contact Brendan Murphy, Tax Partner at Roberts Nathan firstname.lastname@example.org or call (01) 876 4550.
January 28, 2021
Company Acquisitions & Disposals
Deal Done – EnviroChemie Group acquires IWM
EnviroChemie Group, headquartered in Germany and a subsidiary of SKion Water GmbH, has acquired Dublin-based Industrial Water Management Ltd. (IWM) for an undisclosed sum. Founded in 1976, EnviroChemie supplies sustainable system solutions worldwide for all the tasks involved in industrial water treatment and the treatment of process water, circulation water, cooling water, boiler water and wastewater. IWM specializes in cooling tower, steam boiler and water hygiene services, including legionella control and water chemicals supply. With 30 employees, IWM generates an annual turnover of approximately €3m. DWF Dublin (Ross Little, Head of Corporate) advised the shareholders and management of IWM on the legals, and Derek Dervan (Partner in Roberts Nathan) provided corporate finance and tax advice to the shareholders and management of IWM.
January 26, 2021