Reports on Annual Financial Statements

[QRS]

Good day

Would you please be so kind as to assist with the following:

The new Companies act of 2008 which came into effect on 1 May 2011 had a major impact on Audits, Reviews and Annual Financial Statement's formats.

We require examples of the following:

1.) The new compilation report (replaces accounting officer's report) for a CC as well as the new report of the members for a CC.

2.) The new auditor's report and directors' report for PTY Ltd's which do not have to be audited or reviewed.

3.) The new auditor's report and directors' report for PTY Ltd's which have to be audited

4.) The new auditor's report and directors' report for PTY Ltd's which have to be reviewed

Please assist as a matter of urgency, as our client's require their Annual Financial Statements for 2012.

[CLIVE-TRIANGLE]

Audit reports are unaffected.

The report of the independent reviewer is prescribed in ISRE 2400

The report of an independent compiler is prescribed in ISRS 4410

(Just google them)

Be aware that the reviewer may not also compile the AFS. They must either be compiled by the company or another independent accounting professional.

Familiarize yourself with the who may compile, review or audit.

If the company is a per-existing company and now no longer requires an audit, you should have an ordinary resolution to that effect. If it is a post 2/5/2011 company and has an appointed auditor, but is not required to be audited, then again you should have an ordinary resolution to that effect. In such cases the director's report should include a statement to that effect, as well as a breakdown of it's public interest score.

[DavidvN]

Specifically replying to the auditors / accounting officer's report -

1) Compilation report - Read through ISRS 4410, it has illustrative examples.
2) Review report - Read through ISRE 2400, also with examples.
3) Auditor reports - Read through ISA 700 (unqualified report) and 705 (modified reports), also with examples.

Just a quick question, if you're performing an audit, review or compilation, shouldn't you know this already?

[QRS]

Thank you David.

Yes, I should probably know this already. I however do not think the sarcasm was necessary. We are all adapting to the new companies act, and the only way to make sure that we do things the correct way, is by asking questions, attending seminars etc. I have been on one seminar regarding the new companies act, but they focused on Public Interest score calculation, and when should a compilation, review or audit be performed. I know about ISRS4410, ISRE 2400, ISA 700 and ISA 705, but required examples of the reports to amend my templates. I downloaded IRBA's SAAPS3 yesterday and ISRS4410 yesterday, and all the different examples were included in the reports.

[QRS]

Thank you

http://www.irba.co.za/index.php/component/docman/doc_download/1160-proposed-saaps-3

This document was quite useful. Various examples - English and Afrikaans included.

[Shirley Renwick]

I have also attended a number of seminars, but am still not clear on many issues - particularly for sole practitioners trying to keep up to date with changes in legislation is not easy, as we do not have departments that deal with these issues.

I have been trying for some time to obtain clarity on exactly who can perform which engagements, but this is quite difficult to obtain.

When registering a new company on Cipc, it appears to be compulsory to appoint an auditor, even if no audit is required, which does further confuse the issue.

I am an AGA, and am trying to clarify - if a Pty Ltd only requires a compilation - can this be done by an accounting officer?

[Blurock]

I am a bit confused. As an accountant or an auditor, should you not be registered with a professional body? Should the association or professional body that you are registered to not provide you with all of this information?

[Shirley Renwick]

Yes indeed - I am registered with Saica - I have also attended seminars by Saica regarding the new companies act. I have been trying to look on the Saica website to find this information, and maybe I am a bit dim, but I cannot find what I am looking for. So I am looking for something a little more user friendly - it is really time consuming going through link after link on a website and not finding the information that you need.

I would also like to find an example of the director's report for a (Pty) Ltd that does not require a review or an audit.

[Shirley Renwick]

Just trying to keep up with the tax amendments takes up all my time - trying to keep up with the changes in the companies act as well is a major problem

[Imp]

SAIPA provide a good CD with all the letters, working papers, terms of engagement etc etc required for a sole trader, cc, inependent review and independent compilation - it costs around R300. Somebody mentioned getting the support from their governing body, my governing body is CIMA, and unfortunately the support in SA is limited, and so you have to really do your research and I agree with the others, getting the EXACT information you require is a headache and not as easy as you would think. Anyway try the CD, i found it worthwhile.

[Shirley Renwick]

Thanks Imp I will definitely try this