The Companies (Accounting) Bill 2016 (the "Bill") passed Report and Final Stages in Dáil Eireann on 22 March and is now in the process of being examined by the Seanad. Once all the Stages in the Houses of the Oireachtas have been completed, the Bill can be sent to the President for signing.
As we previously reported, the main purpose of the Bill is to transpose the Accounting Directive 2013 (the "Directive"), which provides significant simplifications and reductions of administrative burdens with regard to the preparation of financial statements for enterprises, in particular SMEs. It also introduces mandatory requirements for large companies, large groups and "public interest entities" that are active in the mining and extractive industries or the logging of primary forests to prepare and file annual reports on payments made to governments.
Of particular interest to a number of corporate structures in Ireland are the new provisions requiring a much broader scope of unlimited companies to file financial statements than is the case currently. These provisions are very technical and require careful consideration by any companies that may be impacted by the changes. One of the new requirements being introduced by the Bill is that an unlimited holding company with limited liability subsidiaries will be obliged to file financial statements where it previously may have benefitted from an exemption from doing so. The latest draft of the Bill proposes that the new filing requirement for such holding companies will only come into effect for financial years commencing on or after 1 January 2022.
We will publish a more detailed overview of the new legislation once it has been enacted.