Last year changes were made to the requirements for financial reporting for companies with balance dates after 1 April 2014. Therefore companies with accounting years ending 31 March 2015 are the first to be affected by the new rules.
The changes introduced under the Financial Reporting Act 2013 and the Financial Reporting (Amendments to other Enactments) Act 2013 stated that not all entitles need to prepare general purpose financial statements in line with New Zealand Generally Accepted Accounting Practice (NZ GAAP).
However in reality, even if your company is not required to prepare financial statements under the Financial Reporting Act 2013, you are still likely to need to prepare company financial statements for IRD purposes. Exemptions do apply for some non-active and small companies.
So actually very little has changed! For most it simply means the applicable legislation has changed from Financial Reporting Act 2013 to the Income Tax Act and the need to prepare company financial reports remains.
Minimum company financial statement requirements for IRD purposes:
- A balance sheet stating the assets, liabilities and net assets of the company for the stated income year
- A profit and loss statement showing income and expenditure during the income year; and
- A statement of accounting policies explaining the policies and assumptions that have been used in the preparation of the financial statements and a description of any material changes in accounting policy from prior years, along with Notes to the Accounts including various additional disclosures the IRD now require.
For assistance with preparing your financial statements, please contact us today or request an appointment online.