[Question] AFS / Reviews / Independent Reviews

[Vicky_A]

Good day all

Are there any CA's here that can please assist? I can't seem to find definitive info online.

I have just started my own small business and it is my understanding that all registered companies should have financial statements complied on an annual basis and that this is required in order to submit the IT14 etc. If this is correct, how then does the audit or independent review fit into everything. I understand that the independent review is not as complex and costly as the audit but when do either become a requirement?

Also, if I do my own bookkeeping to TB, can the accountant appointed to compile my AFS also do the IR if required?

Thank you
V

[Nellington]

When Audit is required

Good day all

Are there any CA's here that can please assist? I can't seem to find definitive info online.

I have just started my own small business and it is my understanding that all registered companies should have financial statements complied on an annual basis and that this is required in order to submit the IT14 etc. If this is correct, how then does the audit or independent review fit into everything. I understand that the independent review is not as complex and costly as the audit but when do either become a requirement?

Also, if I do my own bookkeeping to TB, can the accountant appointed to compile my AFS also do the IR if required?

Thank you
V

Good day Vicky

I don't know if you have gotten an answer yet from somebody else, but I don't see any post here so I thought I would just give you the required information.

You are correct in that all registered companies should compile financial statements on a yearly basis. This does not however mean that it has to be an audit, the companies act made provision for smaller companies so that an independent review or compilation can be performed if the company qualifies.

I won't go in to all the detail, but this is calculated by the Public Interest Score of your company, if you google that you should get a breakdown for how that is calculated. This involves the turnover of your company, how many employees you have, third party liability, whether it is a owner managed company or not and a few other things. If it is just you in your company and you don't own any other companies and your business is still small you will most likely be able to get a compilation which is the cheapest one but still complies with the requirements for SARS etc

I am a professional accountant so feel free to message me if you need more assistance.

Regards

Nellington

[Mpholo and Associates]

Good day all

Are there any CA's here that can please assist? I can't seem to find definitive info online.

I have just started my own small business and it is my understanding that all registered companies should have financial statements complied on an annual basis and that this is required in order to submit the IT14 etc. If this is correct, how then does the audit or independent review fit into everything. I understand that the independent review is not as complex and costly as the audit but when do either become a requirement?

Also, if I do my own bookkeeping to TB, can the accountant appointed to compile my AFS also do the IR if required?

Thank you
V

Good day V,

Your question is very much relevant and the response from Nellington is very much accurate.

I may just add that the Accountant who prepared the AFS must not be the one who does the IR, otherwise there will be a "self-review threat".
The Accountant can however, prepare the AFS, and prepare the IR file to be submitted to the Registered Independent Reviewer.

Regards,
Elias Mpholo