Minister Burke has announced the commencement of Section 22 of the Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024. This provision relates to a change to the current audit exemption regime, whereby small and micro sized companies will not, in future, automatically lose the privilege of audit exemption on a first occasion, in a five-year period, of late filing of an annual return with the Companies Registration Office.
Section 22 will replace section 363 of the Companies Act 2014. Section 363 in summary provided that if a company failed to submit an annual return it would lose its audit exemption for the succeeding two years. Section 22 amends this and introduces a graduated regime which means that audit exemption will only be lost if a company files its annual return late more than once in a five-year period.
Section 22 also provides that a company’s first annual return or previous failure to file an annual return before the commencement of the provision (as the company has already lost its audit exemption) shall not be considered a previous failure.
This is a matter that we have made numerous representations on for the last number of years. While we advise members to file on time, there will be genuine reasons why a filing deadline is missed and commencing this provision should reduce the burden on those companies.
It is great to see the commencement of this piece of legislation before the peak filing season commences which will give clarity to members who may need to benefit from it.
Please see the press release here.
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