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Thread: Preparer of financial statements

  1. #1
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    Preparer of financial statements

    I have just had a query from someone re financial statements I prepared.
    Is there a new requirement (or a requiremnt in the new companies act) that the preparer's details should be disclosed?

    I might have missed it...

    Thanks

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    Do you mean you compiled the AFS? If so you should issue a report in terms of International Standard on Related Services 4410, Compilation Engagements, and you should be an accounting professional, as defined. It's difficult to assist without knowing the context..

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    Hi Clive.

    Let put it as simple as it is. If an auditor compiles AFS from a client prepared trial balance, should there be disclosure of that fact somewhere in the notes or directors report or similar?
    I am not issuing a compilation report or any other report for that matter.

    There are some other scenarios where I might be involved in, in the near future but that is a different story altogether

    Ta

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    Found it

    1) If a company provides any financial statements, including any annual financial statements, to any person for any reason, those statements must—

    a) satisfy the financial reporting standards as to form and content, if any such standards are prescribed;

    b) present fairly the state of affairs and business of the company, and explain the transactions and financial position of the business of the company;

    c) show the company’s assets, liabilities and equity, as well as its income and expenses, and any other prescribed information;

    d) set out the date on which the statements were published, and the accounting period to which the statements apply; and

    e) bear, on the first page of the statements, a prominent notice indicating—

    i) whether the statements—

    aa) have been audited in compliance with any applicable requirements of this Act;

    bb) if not audited, have been independently reviewed in compliance with any applicable requirements of this Act; or

    cc) have not been audited or independently reviewed; and

    ii) the name, and professional designation, if any, of the individual who prepared, or supervised the preparation of, those statements.

    If anyone wonders about it now, it is a comanies act requirement

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    Eitnob has quoted the Act for you. The Regulations add a bit more, e.g in all cases the accounting standard is IFRS or IFRS for SME's. Not sure if this is what you were looking for?

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    Clive, I was the OP, and found the section in the act that requires preparers details to be disclosed.

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    Oops, dumb me.

    By the way, the wording of the act implies that even the banks' favourite "management accounts" needs to comply. Would you agree?

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    Quote Originally Posted by CLIVE-TRIANGLE View Post
    By the way, the wording of the act implies that even the banks' favourite "management accounts" needs to comply. Would you agree?
    That's a pretty good question!

    From there - when the bank manager asks for a copy of your management accounts, are they asking you to perform an illegal act?

    The last time a bank manager asked me for my management accounts, I just politely declined saying I was not comfortable releasing anything other than finalised accounts. Now it would seems it's the law! (Much better ) *withdrawn*
    Last edited by Dave A; 28-Apr-12 at 10:58 AM.
    The trouble with opportunity is it normally comes dressed up as work.

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    Gents, I am not so sure about that. The definition of "financial statement" says the following :
    ‘‘financial statement’’

    includes—

    a) annual financial statements and provisional annual financial statements;
    b) interim or preliminary reports;
    c) group and consolidated financial statements in the case of a group of companies; and
    d) financial information in a circular, prospectus or provisional announcement of results, that an actual or prospective creditor or holder of the company’s securities, or the Commission, Panel or other regulatory authority, may reasonably be expected to rely on;

    Management accounts would not be any of the above, but maybe (b), but I'd be willing to argue that it is not preliminary or interim reports. The only places in the act that refers to interim reports is Sch106 on the takeover regulations, and s101 secondary offers to the public.

    My answer : No, management accounts would not need preparers details.

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    Just debating here eitnob..

    1) If a company provides any financial statements, including any annual financial statements, to any person for any reason, those statements must—

    The word "including" means annual financial statements are not excluded.
    I'll consult an expert and see what he says..

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