The Institute recently hosted a webinar on the Small Companies Administrative Rescue Process (SCARP) - Practical Issues. This discussion with David Swinburne and Philip Maher of Mazars included how to prepare for a SCARP, what to look out for and key matters to be aware of when considering the process. There was also discussion around some practical issues including how SCARP is working in practice, dealing with creditors and excludable creditors.  The recording is available here. 

Introduction Readers will know that sanctions are adopted at EU level but may or may not be aware that enforcement relies on member states amongst which definitions of sanctions violation and associated penalties vary. These inconsistencies led to a concern in the EU about undermining of the EU sanctions regime and that potential offenders would deliberately act in jurisdictions where penalties were lighter. Click here for a briefing document by the EU Parliament which wrote ”…The significant differences between national systems, particularly in terms of offences and penalties for breaches of EU sanctions, are thought to weaken their efficacy and the EU's credibility….”  On 24 April 2024 the European Union adopted a directive to harmonise criminal offences for violation of EU sanctions. (the “Directive”). Click here for a link to a European Parliament press release on the Directive. The Directive was introduced to limit sanctions circumvention and to tighten enforcement. The Directive provides a common definition of what constitutes a violation of EU sanctions and provides for penalties for the violation of European Union restrictive measures. The Directive provides for criminalisation for an intentional violation of sanctions but also where there is serious negligence in the circumstances set out in the Directive. It also criminalises attempted violations. What constitutes a criminal offence and exemptions? Article 3 sets out conduct constituting a criminal offence. These include failing to freeze funds, not respecting travel bans or goods embargoes, transferring funds to persons subject to sanctions, or doing business with state-owned entities of countries under sanction. Providing financial services in violation of sanctions will also become a punishable offence. Inciting, aiding, or abetting the commission of offences is also a criminal offence. Member states can exempt conduct from criminal sanction for violations involving funds, economic resources, goods, services, transactions, or activities of a value of less than €10,000.  An exemption is also given for legal professionals regarding information obtained while ascertaining the legal position of a client or defending or representing judicial proceedings. There is also an exemption for providing humanitarian assistance. Penalties The Directive provides for prison sentences and fines. It also includes measures such as withdrawal of permits and authorisations, disqualifications, and temporary bans on running for public office. For natural persons penalties can be between one and five years’ imprisonment depending on the seriousness of the offence. The Directive also provides for liability and penalties for legal persons. Maximum fines can be from 1% to 5% of worldwide turnover of a legal person, depending on the offence. Directive on combatting money laundering by criminal law (2018/1673) amended The definition of criminal activity is amended in this directive to add the violation of Union restrictive measures as a new criminal activity. Entry into force The Directive enters into force on 19 May 2024 and member states have until 20 May 2025 to implement it into national law. This information is 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.  

Welcome to the latest edition of Technical Roundup. In developments since our last edition, the Central Bank of Ireland has recently updated its page which provides information on the impact of the Markets in Crypto Assets Regulation (MiCAR) on Virtual Asset Services Providers. MiCAR will become applicable for Crypto Asset Service Providers (CASPs) from 30 December 2024. The International Accounting Standards Board has issued a new accounting standard IFRS 19 Subsidiaries without Public Accountability: Disclosures. The new standard will permit eligible entities to use IFRS Accounting Standards with reduced disclosures. Read more on these and other developments that may be of interest to members below. Financial Reporting Chartered Accountants Ireland are hosting a webinar on 27th June in Chartered Accountants House with the Financial Reporting Council (FRC). During this event, the FRC will discuss the upcoming changes to FRS 102 and how they will impact accountants in Ireland. Please join us for this free, in-person event. EFRAG, the European Financial Reporting Advisory Group has issued its April 2024 update which summarises the public technical discussions and decisions taken in the last month. The FRC hosted a webinar on 15th May to outline the recent revisions to FRS 102 and FRS 105 as part of the recently completed periodic review. The International Accounting Standards Board (IASB) has published an Exposure Draft which proposes narrow-scope amendments relating to renewable electricity contracts. The amendments aim to ensure that financial statements more faithfully reflect the effects that renewable electricity contracts have on a company. The Exposure Draft remains open for public comment until 7 August 2024. The IASB has issued a new accounting standard, IFRS 19 Subsidiaries without Public Accountability: Disclosures. The new standard will permit eligible entities to use IFRS Accounting Standards with reduced disclosures. This is intended to reduce the costs of preparing financial statements for eligible entities. The IASB has released a series of webinars to raise awareness on their package of proposals contained in their Exposure Draft Business Combinations—Disclosures, Goodwill and Impairment which remains open for public comment until 15 July 2024. The UK Endorsement Board has called for more debate on the need for comprehensive revisions to the accounting and reporting of intangible assets. In recognition of this, it has published a report on its research of intangible reporting in the UK as well as the findings from a survey of users of financial statements. In the UK, the Department of Business & Trade has issued a consultation on two proposals aimed at reducing the burden of reporting on medium-sized companies. This is part of the government initiative to legislate on a series of non-financial reporting measures following a commitment to consult on further measures to reduce regulatory burdens for medium-sized companies. These proposals are (1) Uplifting the employee threshold for medium-sized companies from no more than 250 to 500 employees and (2) Exempting medium-sized companies from producing a strategic report (including companies that would be medium-sized except for the fact that they are a member of an ineligible group). The consultation will close on Thursday 27 June.   Auditing and Assurance Chartered Accountants Ireland have responded to the IESBA Exposure Draft: Using the Work of an External Expert and also the IESBA consultation on the Code of Ethics. Accountancy Europe have also responded to IESBA’s Exposure Draft on International Ethics Standards for Sustainability Assurance (including International Independence Standards) (IESSA) and ethics standards for sustainability reporting. Anti–money laundering and sanctions The Central Bank of Ireland has recently updated its page which provides information on the impact of the Markets in Crypto Assets Regulation (MiCAR) on Virtual Asset Services Providers. MiCAR will become applicable for Crypto Asset Service Providers (CASPs) from 30 December 2024. After this date, any firms seeking to establish themselves in Ireland to offer any CASP services will firstly need to be authorised by the Central Bank of Ireland. Under the existing Virtual Asset Services Providers regime, introduced in April 2021, firms seeking to provide any VASP activities are required to be registered by the Central Bank as a VASP prior to the commencement of operations. The page also gives details of a transitional period which will apply for up to 12 months. You can read more details about the changes here. Companies House UK has recently updated guidance in relation to its “Register of Overseas Entities: Approach to enforcement” which explains how it will use its enforcement powers in relation to the Register of Overseas Entities. Readers can find out more about it here. Insolvency David Swinburne and Philip Maher of Mazars along with Laura-Michelle Moore from Chartered Accountants Ireland will be speaking at a webinar about the practical issues of the Small Companies Administrative Rescue Process (SCARP) on 29 May at 10am. You can register here for this free webinar.   Sustainability In its recent article, the Global Reporting Initiative (GRI) has highlighted the results of its recent research which found that 26% of the 1,000 largest public companies worldwide are voluntarily using the GRI tax standard in their sustainability report. IAASA recently undertook a desktop examination of the EU Taxonomy Regulation disclosures of a sample of issuers’ financial statements and has now published a Paper setting out its findings. The GRI has produced CSRD Essentials which outlines key aspects of the CSRD and is the result of joint working between GRI, Pascal Durand, Member of the European Parliament and CSRD Rapporteur, and the Lefebvre – Sarrut Group. It consists of 11 core briefings and is definitely worth a read for anyone looking to get a good overview of the CSRD. The International Sustainability Standards Board (ISSB) has released a webcast introducing the ISSB Taxonomy. Recent case law -franchises Readers involved with franchisors, franchisees and franchise agreements will be interested in a recent UK High Court decision which demonstrates the importance for franchisors of giving prior consideration to exit strategies from agreements. This is to minimize the risk of being locked into long-term franchise agreements which are no longer commercially viable for business. Please click here for an article and commentary by A&L Goodbody Solicitors on the case entitled Pre-planning and active management of longstanding franchise agreements | A&L Goodbody LLP (algoodbody.com). A &L Goodbody note that while the case was in the UK High Court, it is likely to be persuasive in this jurisdiction, particularly in the current absence of similar caselaw in Ireland and that it is understood that the decision is under appeal. Other The Charities Regulator has recently issued its latest e-zine newsletter. Its news includes information on managing conflicts of interest and details on a stakeholder forum which met in April. You can access the newsletter here. In other Charities news, the Charities Regulator is hosting a webinar on 28 May next at 12.30 as it is publishing an analysis of the Annual Reports submitted by charities to the Charities Regulator between 2019 and 2022.The webinar will be hosted by Research Manager, Mandy Osborne, and the session will give attendees up-to-date information on changes across the charity sector. The webinar will provide insights into charity income, expenditure, employment and volunteering, and how organisations have weathered COVID-19. Please click here for more information and how to register. The European Securities and Markets Authority has published its April 2024 newsletter which you can access here. It includes items on crypto assets market structures and EU relevance and a number of items on Digital Operational Resilience Act (DORA). For further technical information and updates please visit the Technical Hub on the Institute website.    This information is provided as resources and information only and nothing in the information 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 information. 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 the information 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 herein.

Welcome to the latest edition of Technical roundup. In developments since the last edition, David Swinburne and Hilary Larkin of Mazars along with Laura-Michelle Moore from Chartered Accountants Ireland will be speaking at a webinar about the practical issues of the Small Companies Administrative Rescue Process (SCARP) on 29 May at 10:00. The European Parliament has recently adopted a package of laws strengthening the EU’s toolkit to fight money-laundering and terrorist financing. The Anti-Money Laundering and Countering the Financing of Terrorism package consists of a directive and two regulations. Read more on these and other developments that may be of interest to members below. Financial Reporting The Financial Reporting Council (FRC) is hosting a webinar on its recent revisions to FRS 102 on Wednesday, 15 May 2024 11:00-12:00. The International Accounting Standards Board (IASB) has announced that it is launching a comprehensive review of accounting for intangibles. This project will assess whether the requirements of IAS 38 Intangible Assets remain relevant and will be explored and discussed by the IASB in the coming months. The IASB has announced that it expects to issue its next Accounting Standard, IFRS 19 Subsidiaries without Public Accountability: Disclosures, on 9 May 2024. The IASB has issued its April 2024 update which highlights decisions taken and projects affected during the month. It has also published its April 2024 podcast. The IFRS Foundation has also issued its April 2024 monthly news summary. The IASB has announced that it expects to publish the Exposure Draft Contracts for Renewable Electricity on 8 May 2024. Following on from the recent release of IFRS 18 Presentation and Disclosure in Financial Statements, the IASB are holding a series of webinars to help stakeholders gain a better understanding of the new requirements. The UK Endorsement Board has released a webcast which discusses IFRS 18. The IFRS Foundation has published a video explaining what the IFRS Digital Taxonomies are and how they enable information to be prepared in a machine readable format. The IFRS Foundation has published its 10th Compendium of Agenda Decisions by the IFRS Interpretations Committee. This covers the 6 month period to April 2024. The IFRS Foundation has published its 2023 Annual Report for the year ended 31 December 2023. EFRAG, the European Financial Reporting Advisory Group has published its draft comment letter on the IASB’s Exposure Draft ED/2024/03 Business Combinations—Disclosures, Goodwill and Impairment (Proposed amendments to IFRS 3, IAS 36). The draft remains open for public comment until 28 June 2024. Auditing and Assurance IAASA has published its annual ‘Profile of the Profession’ for 2023 containing statistical data provided by the six Prescribed Accountancy Bodies (‘PABs’). The report presents an overview of the PABs’ members and students and includes statistics about their regulatory and monitoring activities. A video summary is available here. Anti–money laundering and sanctions The European Parliament has recently adopted a package of laws strengthening the EU’s toolkit to fight money-laundering and terrorist financing. The Anti-Money Laundering and Countering the Financing of Terrorism package consists of a directive and two regulations. These are the sixth Anti-Money Laundering directive, the EU “single rulebook” regulation and the Anti-Money Laundering Authority (AMLA) regulation. The laws must be formally adopted by the European Council before publication in the EU’s Official Journal. Click here for a press release from the European Parliament on the package and here to access the Institute’s dedicated pages on anti-money laundering which have recently been updated to include a page dedicated to European Union developments. In the UK the Office of Financial Sanctions Implementation (OFSI) has recently launched a UK Financial Sanctions FAQs webpage. Ninety one questions and answers are listed including featured FAQs “Are UK entities’ subsidiaries located outside the UK expected to comply with UK sanctions? “and “How do the fees and expenses caps apply? Is it per DP (i.e., for all a DP’s matters across all law firms) or is it per law firm being instructed by a DP?”. The UK Financial Conduct Authority is consulting on updates to its Financial Crime Guide. The updates relate to sanctions, proliferation financing and transaction monitoring. It is also proposing to add references to cryptoassets and the Consumer Duty, along with consequential changes throughout the Guide. The consultation closes on 27 June 2024. Insolvency David Swinburne and Hilary Larkin of Mazars along with Laura-Michelle Moore from Chartered Accountants Ireland will be speaking at a webinar about the practical issues of the Small Companies Administrative Rescue Process (SCARP) on 29 May at 10am. You can register here for this free webinar. Sustainability Accountancy Europe has welcomed the final approval of the Corporate Sustainability Due Diligence Directive (CSDDD) by the European Parliament (EP) and the Council. Member States can now start transposing the Directive into national laws in 2024. Accountancy Europe has also issued its April 2024 Sustainability Update. The Department of Enterprise, Trade and Employment (DETE) is consulting on one of the member state options of the CSRD to introduce Independent Assurance Services Providers (IASPs) pursuant to Article 34(4) of Directive 2013/34/EU (‘Accounting Directive’) inserted by Directive 2022/2464/EU as regards Corporate Sustainability Reporting (‘CSRD’). The deadline for responding to the consultation is 19 July 2024. Ahead of the anti-greenwashing rule coming into force on 31 May, the Financial Conduct Authority (FCA) is supporting industry with guidance to help them meet the standard.  It is also consulting on extending to portfolio managers the requirements on how sustainable investments are labelled and explained. The International Sustainability Standards Board (ISSB) has announced that it will commence projects to research disclosure about risks and opportunities associated with biodiversity and human capital. The ISSB has issued its April 2024 Update and Podcast. The inaugural IFRS Sustainability Disclosure Taxonomy was published on 30 April. The Taxonomy reflects IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information, IFRS S2 Climate-related Disclosures and their accompanying guidance. The IFRS Foundation and EFRAG have jointly published guidance material which illustrates the level of alignment achieved between the ISSB’s Standards (IFRS S1 and S2) and the European Sustainability Reporting Standards. The International Federation of Accountants (IFAC) has proposed changes to the International Education Standards to improve the training offering for aspiring professional accountants. Central Bank of Ireland The Central Bank of Ireland has completed and published the outcome of a review of the supports that banks, retail credit firms and credit servicing firms provide for borrowers in or facing early arrears. Click here for the press release and here for the Dear CEO letter from the Head of Consumer protection division. Director of Consumer Protection, Colm Kincaid said: “The Central Bank has carried out this review to ensure the financial system is supporting borrowers in or facing early arrears on their mortgage. It comes as we see an increased number of borrowers falling into early arrears, as increased costs of living impact on borrowers’ finances.” New legislation A regulation which transposes the Representative Actions Directive (RA Directive) has recently been signed into Irish law. The RA Directive ensures that groups of consumers can protect their collective interests for an infringement of their consumer rights both in here in Ireland and in the EU, through a representative action. Click here for a DETE press release which provides more information on the RA Directive and the transposing regulation. On the drafting side, the Government recently published its legislative programme for Summer 2024. Read the press release here and the contents of the programme here. The Access to Cash Bill, Companies (Corporate Governance Enforcement and Regulatory Provisions) Bill and a National Cyber Security Bill are listed for priority drafting. The Miscellaneous Provisions (Transparency and Registration of Limited Partnerships and Business Names) Bill is listed as heads in preparation and the Charities (Amendment) Bill 2023 is on the Dail and Seanad Order Paper. Other The European Securities and Markets Authority (ESMA) has responded to the European Commission request on amendments to the European long-term investment fund (ELTIF) Technical Standards (RTS). In the letter ESMA suggests that there should be a limited number of changes to find the right balance between protecting retail investors and contributing to the capital market union objectives.    Readers are reminded that the Corporate Enforcement Authority’s April newsletter is now available. Highlights include a focus on directors’ disqualification and company law developments. You can read more details here and click to be brought to CEA website where you can sign up for the newsletter. Click here for the European Commission’s news finance hub where readers can subscribe for the newsletter and keep up to date with all the latest EU finance news including digital & sustainable finance, banking, anti-money laundering and sanctions. You can for example read an article on the new AML rules (reported on above) which notes that they will change the EU’s financial crime prevention landscape for good but asks and provides some answers to what will change in practice. On 24 April EU and Member States representatives celebrated 20 years of EU enlargement. President von der Leyen highlighted the many benefits that EU membership brought to the then-new Member States while also underlining the many advantages that the Union itself drew from this enlargement. The Financial Conduct Authority in the UK has issued an Artificial Intelligence (AI) update to outline its approach to AI following the Government’s publication of its pro-innovation strategy on AI. AI The update outlines the FCA’s role and objectives, it’s work so far, its existing approach and its plans for the next 12 months. You can read more about it here. For further technical information and updates please visit the Technical Hub on the Institute website.      This information is provided as resources and information only and nothing in the information 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 information. 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 the information 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 herein.  

In the UK the Office of Financial Sanctions Implementation (OFSI) has recently launched a UK Financial Sanctions FAQs webpage. Ninety-one questions and answers are listed including featured FAQs “Are UK entities’ subsidiaries located outside the UK expected to comply with UK sanctions? “and “How do the fees and expenses caps apply? Is it per DP (i.e., for all a DP’s matters across all law firms) or is it per law firm being instructed by a DP?”   This information is 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.

The European Parliament has recently adopted a package of laws strengthening the EU’s toolkit to fight money-laundering and terrorist financing. The Anti-Money Laundering and Countering the Financing of Terrorism package consists of a directive and two regulations. These are the sixth Anti-Money Laundering directive, the EU “single rulebook” regulation and the Anti-Money Laundering Authority (AMLA) regulation. Click here for a press release from the European Parliament on the package and here to access the Institute’s dedicated pages on anti-money laundering which have recently been updated to include a page dedicated to European Union developments. We understand from the press release that the laws still need to be formally adopted by the European Council before publication in the EU’s Official Journal. There will also be a process of translation of text and the expectation is that publication of the text will occur in the Official Journal between July and September of 2024. This information is 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.