Financial reporting requirements of company law in Ireland

Company Law in Ireland requires that directors of companies incorporated in Ireland prepare financial statements for the company in respect of each financial year which give a “true and fair view”.  Such financial statements are either:

• ‘Companies Act financial statements’, prepared in accordance with the accounting and disclosure requirements of company law and, principally but not exclusively*, with the Financial Reporting Standards (FRSs) published by the Financial Reporting Council (FRC) in the UK (‘Irish and UK GAAP’); or

• ‘IFRS financial statements’, prepared in accordance with the International Financial Reporting Standards published by the International Accounting Standards Board (IASB), as adopted by the European Union.

By virtue of the IAS Regulation (Regulation (EC) No.1606/2002), the consolidated financial statements of companies with debt or equity securities listed on a regulated EU market, e.g. the main market of the Irish Stock Exchange, are required to be prepared in accordance with EU adopted IFRS. 

For other financial statements, sections 290 and 293, of the Companies Act 2014 as amended ('Companies Act 2014'), permit a choice, subject to certain exceptions, as to whether to prepare ‘Companies Act financial statements’ or ‘IFRS financial statements’.

*Certain entities are permitted under Irish company law to prepare their Companies Act financial statements under a financial reporting framework based on accounting standards other than those issued by the FRC.  Specifically, and subject to certain conditions:

• Pursuant to section 279 of the Companies Act 2014, relevant holding companies are permitted to prepare ‘Companies Act entity financial statements’ and/or ‘Companies Act group financial statements’ in accordance with US GAAP, as modified to ensure consistency with Irish company law.
• Investment companies subject to Part 24 of the Companies Act 2014 or the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2011 may adopt an alternative body of accounting standards, being standards which apply in the United States of America, Canada or Japan in preparing ‘Companies Act entity or group financial statements’ or ‘Companies Act entity financial statements’ respectively. 

'Companies Act financial statements'

The principal company law financial reporting requirements are set out in Part 6 of the Companies Act 2014 and the following schedules to the Companies Act 2014:

• Schedule 3 ('Accounting Principles, Form and Content of Entity Financial Statements');
• Schedule 3A ('Accounting Principles, Form and Content of Entity Financial Statements of a company qualifying for the small companies regime’);
• Schedule 3B ('Accounting Principles, Form and Content of Financial Statements of a company qualifying for the micro companies regime’);
• Schedule 4 ('Accounting Principles, Form and Content of Group Financial Statements'); and
• Schedule 4A ('Accounting Principles, Form and Content of Group Financial Statements for companies subject to the small companies regime’).

Note that the Schedules mentioned above do not apply to credit institutions and insurance undertakings. The relevant Regulations for those types of company are contained in:

• European Union (Credit Institutions: Financial Statements) Regulations 2015 (S.I. No. 266 of 2015) (as amended);
• European Union (Insurance Undertakings: Financial Statements) Regulations 2015 (S.I. No. 262 of 2015), as amended by the European Union (Insurance Undertakings: Financial Statements) (Amendment) Regulations 2016 (S.I. No. 213 of 2016).

'IFRS financial statements'

Companies required to, or opting to, prepare 'IFRS financial statements' are not subject to the accounting requirements of Schedules 3, 3A, 3B, 4 and 4A of the Companies Act 2014, S.I. No. 262 of 2015 (as amended) or S.I. No. 266 of 2015 (as amended) on the preparation of financial statements.  They are, however, subject to certain additional disclosure requirements in accordance with sections 292 and 295 of the Companies Act 2014.

This page provides a very brief overview only. Reporting entities will need to make reference to the relevant detailed legal accounting requirements when preparing financial statements.

These pages are provided as resources and information only and nothing in these pages purports to provide professional advice or definitive legal interpretation(s) or opinion(s) on the applicable legislation or legal or other matters referred to in the pages. If the reader is in doubt on any matter in this complex area further legal or other advice must be obtained. While every reasonable care has been taken by the Institute in the preparation of these pages, we do not guarantee the accuracy or veracity of any resource, guidance, information or opinion, or the appropriateness, suitability or applicability of any practice or procedure contained therein. The Institute is not responsible for any errors or omissions or for the results obtained from the use of the resources or information contained in these pages.