Accounts Exemptions
Companies Act
Qualification of company as small or medium company
350. (1) In this section “qualifying conditions” means the conditions referred to in subsection (5) or (6), as appropriate.
(2) A company that is not excluded by subsection (11) qualifies as a small company or a medium company in relation to its first financial year if the qualifying conditions are satisfied in respect of that year.
(3) A company that is not excluded by subsection (11) qualifies as a small company in relation to a subsequent financial year—
(a) if the qualifying conditions are satisfied in respect of that year and the preceding financial year,
(b) if the qualifying conditions are satisfied in respect of that year and the company qualified as a small company in relation to the preceding financial year,
(c) if the qualifying conditions were satisfied in the preceding financial year and the company qualified as a small company in relation to that year.
(4) A company that is not excluded by subsection (11) qualifies as a medium company in relation to a subsequent financial year—
(a) if the qualifying conditions are satisfied in respect of that year and the preceding financial year,
(b) if the qualifying conditions are satisfied in respect of that year and the company qualified as a medium company in relation to the preceding financial year,
(c) if the qualifying conditions were satisfied in the preceding financial year and the company qualified as a medium company in relation to that year.
(5) The qualifying conditions for a small company are satisfied by a company in relation to a financial year in which it fulfils 2 or more of the following requirements:
(a) the amount of the turnover of the company does not exceed €8.8 million;
(b) the balance sheet total of the company does not exceed €4.4 million;
(c) the average number of employees of the company does not exceed 50.
(6) The qualifying conditions for a medium company are satisfied by a company in relation to a financial year in which it fulfils 2 or more of the following requirements:
(a) the amount of the turnover of the company does not exceed €20 million;
(b) the balance sheet total of the company does not exceed €10 million;
(c) the average number of employees of the company does not exceed 250.
(7) In this section “amount of the turnover”, in relation to a company, means the amount of the turnover shown in the company’s profit and loss account.
(8) In the application of this section to any period which is a financial year but is not in fact a year, the amounts specified in subsections (5)(a) and (6)(a) shall be proportionately adjusted.
(9) In this section “balance sheet total”, in relation to a company, means the aggregate of the amounts shown as assets in the company’s balance sheet.
(10) For the purposes of subsections (5)(c) and (6)(c), the average number of employees of a company shall be determined by applying the method of calculation prescribed by section 317 for determining the number required by subsection (1)(a) of that section to be stated in a note to the financial statements of a company.
(11) This section shall not apply to a company if it is—
(a) a holding company that prepares group financial statements, or
(b) a company falling within any provision (in so far as applicable to a private company limited by shares) of Schedule 5 .
Exemptions in respect of directors’ report in the case of small and medium companies
351. A company that qualifies as a small or medium company in accordance with section 350 is exempt from the requirement in—
(a) section 326 (3) to give information in its directors’ report for the period concerned regarding the use of financial instruments during that period, and
(b) section 327 (3) to provide in its directors’ report for the period concerned an analysis of key performance indicators during that period.
Exemption from filing certain information for small and medium companies
352. (1) The exemption in subsection (2) is available to a company that qualifies as a small or medium company in accordance with section 350 .
(2) That exemption is an exemption from the requirement in section 347 to annex to the company’s annual return the following documents:
(a) the statutory financial statements of the company;
(b) in the case of a small company, the directors’ report; and
(c) the statutory auditors’ report on those financial statements and that directors’ report.
(3) If a company that qualifies as a small company avails itself of the exemption provided by this section, it shall instead annex to its annual return a copy of each of the following documents:
(a) abridged financial statements prepared in accordance with section 353 and which have been approved and signed in accordance with section 355 ;
(b) the information referred to in section 329 that is required to be stated in the directors’ report and extracted therefrom; and
(c) a special statutory auditors’ report prepared in accordance with section 356 .
(4) If a company that qualifies as a medium company avails itself of the exemption provided by this section, it shall instead annex to its annual return a copy of each of the following documents:
(a) abridged financial statements prepared in accordance with section 354 and which have been approved and signed in accordance with section 355 ;
(b) the directors’ report prepared in accordance with section 325 ; and
(c) a special statutory auditors’ report prepared in accordance with section 356 .
(5) The reference in subsection (3) or (4) to a copy of a document is a reference to a copy that satisfies the following conditions:
(a) it is a true copy of the original save for the difference that the signature or signatures on the original, and any date or dates thereon, shall appear in typeset form on the copy; and
(b) it is accompanied by a certificate of a director and the secretary of the company, that bears the signature of the director and the secretary in electronic or written form, stating that the copy is a true copy of the original (and one such certificate relating to all of the documents mentioned in subsection (3) or (4), as the case may be, suffices and the foregoing statement need not be qualified on account of the difference permitted by paragraph (a) as to the form of a signature or of a date).
Abridged financial statements for a small company
353. (1) For the purposes of section 352 , the abridged financial statements of a company that qualifies as a small company shall, in the manner set out in this section, be extracted from the statutory financial statements of the company prepared under section 290 .
(2) Where the statutory financial statements of the company are IFRS financial statements, the abridged financial statements shall comprise—
(a) the balance sheet of the company,
(b) those notes to the financial statements that provide the information required by sections 305 to 321 , and
(c) those notes to the financial statements that provide the following information—
(i) information in relation to the maturity of non-current liabilities, and
(ii) details of any security given in respect of those liabilities.
(3) Where the statutory financial statements of the company are Companies Act financial statements, the abridged financial statements shall comprise—
(a) the balance sheet of the company,
(b) those notes to the financial statements that provide the information required by sections 305 to 321 ,
(c) those notes to the financial statements that provide the information required by paragraphs 52, 53, 57, 58 and 68 of Schedule 3 , and
(d) if not shown separately on the face of the balance sheet, the total amounts falling due within one year and after one year shall be shown separately for item B.II (Debtors) if the balance sheet is prepared in accordance with Format 1 and items B.II (Debtors) and C (Creditors) if the balance sheet is prepared in accordance with Format 2 in Schedule 3 .
(4) Section 274 (3) (references to balance sheet to include certain notes) does not apply to this section.
Abridged financial statements for a medium company
354. (1) For the purposes of section 352 the abridged financial statements of a company that qualifies as a medium company shall be the same as the statutory financial statements of the company prepared under section 290 except that the profit and loss account and notes may be abridged in the manner set out in this section.
(2) Where the statutory financial statements of the company are IFRS financial statements an abridged income statement which combines as one item under the heading “gross profit or loss” the company’s revenue and certain expenses for the period may be extracted from the income statement prepared in accordance with international financial reporting standards.
(3) For the purposes of subsection (2), the following provisions apply as regards the combination of expenses as one item with the revenue of the company:
(a) where the expenses are classified by function, only those expenses classified as “cost of sales” may be so combined, and
(b) where the expenses are classified by nature, only changes in finished goods and work-in-progress and raw materials and consumables used may be so combined.
(4) For the purposes of subsection (2), the notes to the statutory financial statements may be abridged such that items that are combined on the face of the income statement are not separately identified in the notes.
(5) Where the statutory financial statements of the company are Companies Act financial statements an abridged profit and loss account which combines as one item under the heading “gross profit or loss” the company’s turnover and certain expenses for the period may be extracted from the profit and loss account prepared in accordance with section 291 .
(6) For the purpose of subsection (5), the turnover and expenses that may be combined as one item are—
(a) items 1, 2, 3 and 6 in Format 1 of the profit and loss account formats set out in Schedule 3 ,
(b) items 1 to 5 in Format 2 of those profit and loss account formats,
(c) items A.1, B.1 and B.2 in Format 3 of those profit and loss account formats,
(d) items A.1, A.2 and B.1 to B.4 in Format 4 of those profit and loss account formats.
(7) For the purpose of subsection (5), the notes to the statutory financial statements may be abridged such that items that are combined on the face of the income statement are not separately identified in the notes and in particular the information required by paragraph 65 of Schedule 3 need not be given.
(8) Section 274 (4) (references to profit and loss account to include certain notes) does not apply to this section.
Approval and signing of abridged financial statements
355. (1) Where the directors of a company are satisfied that the requirements of section 353 or 354 , as appropriate, have been complied with as regards the preparation of the abridged financial statements, those financial statements shall be approved by the board of directors and signed on their behalf by 2 directors, where there are 2 or more directors.
(2) Without prejudice to the generality of section 11 and its application to the other provisions of this section, where the company has a sole director subsection (1) operates to require that director, if he or she is satisfied as to the matters referred to in that subsection in respect of the statements, to approve and sign the abridged financial statements.
(3) In addition to the preceding requirements, there shall be included the following statement on the face of the abridged balance sheet, namely a statement by the directors of the company that:
(a) they have relied on the specified exemption contained in section 352 ;
(b) they have done so on the ground that the company is entitled to the benefit of that exemption as a small company or (as the case may be) as a medium company; and
(c) the abridged financial statements have been properly prepared in accordance with section 353 or 354 , as appropriate.
(4) The signatures or signature required by subsection (1) or (2), as the case may be, shall be inserted on the face of the abridged balance sheet immediately after the statement referred to in subsection (3).
(5) Every copy of every abridged balance sheet which is approved by the board of directors or which is circulated, published or issued shall state the names of the persons who signed the balance sheet on behalf of the board of directors.
(6) The following requirements apply to the documents annexed to the annual return under section 352 (3) or (4) and delivered to the Registrar:
(a) the copy of the abridged financial statements required by section 352 (3)(a) or (4)(a) shall state the names of the directors who signed the abridged balance sheet on behalf of the board of directors;
(b) the information referred to in section 329 that, as required by section 352 (3)(b), has been extracted from the directors’ report shall be accompanied by a certificate of the secretary of the company stating that it is a true copy of the information laid before the members in general meeting (and that certificate shall bear the signature of the secretary in written or electronic form);
(c) the copy of the directors’ report required by section 352 (4)(b) shall state the names of the directors who signed the report on behalf of the board of directors;
(d) the copy of the special statutory auditors’ report required by section 352 (3)(c) or (4)(c) shall state the name of the statutory auditors who signed the report and, if different, the name of the statutory auditors who signed the report under section 391 .
(7) If abridged financial statements are approved which have not been prepared in accordance with the requirements of section 353 or 354 , as the case may be, every director of the company who is party to their approval, and who knows that they have not been so prepared or is reckless as to whether they have been so prepared, shall be guilty of a category 2 offence.
(8) For that purpose, every director of the company at the time the abridged financial statements are approved shall be taken to be a party to their approval unless he or she shows that he or she took all reasonable steps to prevent their being approved.
(9) If the requirements of subsection (6) as regards documents annexed to an annual return under section 352 (3) or (4) are not complied with, the company concerned and any officer of it who is in default shall be guilty of a category 2 offence.
(10) In subsection (9) “officer” includes any shadow director and de facto director.
Special report of the statutory auditors on abridged financial statements
356. (1) There shall accompany abridged financial statements annexed to the annual return and delivered to the Registrar a copy of a special report of the statutory auditors of the company to the directors of it containing—
(a) a statement of the statutory auditors with respect to the matters set out in subsection (2) on those abridged financial statements, and
(b) a copy of the statutory auditors’ report under section 391 in the form required by section 336 .
(2) Where—
(a) the directors of a company propose to annex to the annual return abridged financial statements for any financial year prepared pursuant to section 353 or 354 , and
(b) the statutory auditors of the company are of opinion that the directors of the company are entitled, for that purpose, to rely on the exemption contained in section 352 and the abridged financial statements have been properly prepared pursuant to section 353 or 354 , as the case may be,
it shall be the duty of the statutory auditors of the company to state in the special report referred to in subsection (1) that, in the opinion of those auditors—
(i) the directors of the company are entitled to annex those abridged financial statements to the annual return, and
(ii) the abridged financial statements so annexed are properly so prepared.
(3) With respect to the statutory auditors’ special report referred to in subsection (1) (a copy (as that expression is to be read in accordance with section 352 (5)) of which is to be delivered to the Registrar), the original of that report shall be signed by the statutory auditors and bear the date of such signing; the requirements of section 337 (2) with respect to the signing of the report there referred to shall also apply with respect to the signing of the special report.
(4) Every copy of the special report of the statutory auditors prepared in accordance with subsection (1) that is circulated, published or issued shall state the name of the statutory auditors providing the report and, if different, the names of the statutory auditors who provided the report under section 391 .
(5) If a company fails to comply with subsection (1) or (4), the company and any officer of it who is in default shall be guilty of a category 2 offence.
(6) In subsection (5) “officer” includes any shadow director and de facto director.
Subsidiary undertakings exempted from annexing their statutory financial statements to annual return
357. (1) Where a company is a subsidiary undertaking of a holding undertaking that is established under the laws of an EEA state, the company shall, as respects any particular financial year of the company, stand exempted from the provisions of sections 347 and 348 if, but only if, the following conditions are satisfied:
(a) every person who is a shareholder of the company on the date of the holding of the next annual general meeting of the company after the end of that financial year or on the next annual return date of the company after the end of that financial year, whichever is the earlier, shall declare his or her consent to the exemption;
(b) there is in force in respect of the whole of that financial year an irrevocable guarantee by the holding undertaking of all amounts shown as liabilities in the statutory financial statements of the company in respect of that financial year;
(c) the company has notified in writing every person referred to in paragraph (a) of the guarantee;
(d) the statutory financial statements of the company for that financial year are consolidated in the consolidated accounts prepared by the holding undertaking;
(e) the exemption of the company under this section is disclosed in a note to those consolidated accounts;
(f) a notice stating that the company has availed itself of the exemption under this section in respect of that financial year together with—
(i) a copy of the guarantee and notification referred to in paragraphs (b) and (c), and
(ii) a declaration by the company in writing that paragraph (a) has been complied with in relation to the exemption,
is annexed to the annual return for the financial year made by the company to the Registrar;
(g) the consolidated accounts of the holding undertaking are drawn up in accordance with the requirements of the Seventh Council Directive 83/349/EEC of 13 June 1983 or in accordance with international financial reporting standards and are audited in accordance with Article 37 of that Seventh Council Directive; and
(h) a copy of the consolidated accounts of the holding undertaking together with the report of the auditors on them are annexed to the annual return of the company referred to in paragraph (f).
(2) Where any document referred to in subsection (1) that has been annexed to the annual return is in a language other than the English language or the Irish language, there shall be annexed to each such document a translation of it in the English language or the Irish language certified in the prescribed manner to be a correct translation.
(3) Section 299 (7) (construction of certain references) shall apply to subsection (1) in a case where the holding undertaking referred to in subsection (1) is a company registered under this Act or an existing company.
(4) Section 347 (2) applies for the purpose of the construction of the reference to a copy of a document in subsection (1)(h) of this section as it applies for the purpose of the construction of the reference to a copy of a document in section 347 (1).
The text in italics on this page is sourced from the Irish Statute Book and is re-published under the Licence for Re-Use of Public Sector Information made pursuant to Directive 2003/98/EC Directive 2013/37/EU of the European Parliament and of the Council on the re-use of public sector information transposed into Irish law by the European Communities (Re-Use of Public Sector Information) Regulations 2005 to 2015.