Accounts and audit

1. Two directors sign within six months

The board of every company must have financial statements completed for the balance sheet date, and dated and signed, within 6 months after that date, or within another period the Registrar determines. Where the company has two directors, both sign. Where it has only one director, that director signs. The Registrar may extend the 6 months where he considers it appropriate.

Tamarind has two directors, Meera and Ravi. Both sign. A signature by Meera alone does not meet section 210 while Ravi remains a director.

The statements have to present fairly the financial position, the financial performance and, where stated, the cash flow.

Companies Act, sections 210 and 211.

2. What “small” changes in the statements

Public companies and private companies prepare statements that comply with International Accounting Standards, and with any other enactment that applies to those statements. A small private company follows a narrower rule. Its statements comply with regulations under the Companies Act, or accounting standards, or regulations under the Financial Reporting Act, which prescribe the form and content of financial statements for small private companies.

A private company that is not a small private company, or a public company, and that is not a public interest entity under the Financial Reporting Act, may prepare its statements in accordance with the International Financial Reporting Standards for SMEs.

Tamarind’s last preceding turnover is Rs 80 million. It is a private company, it does not hold a Global Business Licence, and the Financial Reporting Act does not specify it as an entity excluded from the small-company test. It is a small private company. Its statements follow the small-company form, not the full International Accounting Standards, and not the SME standards, which are for a private company that is not small.

Rs 100 million is the line

Last preceding turnover	What Tamarind is	What follows
Rs 80 million, and the other small-company conditions are met	A small private company	The small-company form. No filing of statements and an auditor’s report under section 215
Exactly Rs 100 million	Still private. No longer small	International Accounting Standards, or the SME standards if it is not a public interest entity
Rs 120 million	Still private. No longer small	Those standards, an auditor under section 198, and filing within 28 days after the statements are required to be signed

Turnover of exactly Rs 100 million is not less than Rs 100 million. At that figure Tamarind would stop being a small private company. It would still be private. Its statements would then be International Accounting Standards, unless it was not a public interest entity, in which case it could use the SME standards. Profit of Rs 2 million would not decide that question. The small-company test uses turnover.

Companies Act, section 211. The public-interest-entity test is in the Financial Reporting Act.

3. Filing, and the auditor

Every company other than a small private company files copies of the signed statements, and the auditor’s report on them, with the Registrar within 28 days after the statements are required to be signed, or within another period the Registrar determines. Tamarind, while it remains small, does not have that filing duty.

A person must not be appointed or act as auditor of a company other than a small private company unless that person has a qualification listed in section 198 and is licensed under the Financial Reporting Act, or is a firm whose audit work is done by such a person. A director or employee of the company cannot be the auditor. A person who is not ordinarily resident in Mauritius cannot be the auditor. A body corporate cannot be the auditor, except a limited liability partnership.

What changes at Rs 120 million

At Rs 80 million, Tamarind does not file the statements and an auditor’s report under section 215. If turnover in the last preceding accounting period is Rs 120 million, the company is no longer small. The statements are signed by both directors within 6 months of the balance sheet date, an auditor who meets section 198 reports on them, and the company files the statements and that report within 28 days after the statements are required to be signed. Meera cannot sign the audit report. She is a director.

Companies Act, sections 198 and 215.

What you should now be able to explain

Both directors sign within six months of the balance sheet date. At Rs 80 million the statements follow the small-company form and are not filed with an auditor’s report under section 215. At Rs 120 million the company needs International Accounting Standards or, if it is not a public interest entity, the SME standards, an independent auditor, and the 28-day filing.

Next: what a shareholder who does not control the vote can require, inspect, and ask the Court to do.