A joint legislative proposal to simplify the audit procedure of micro companies' financial statements is expected to go to plenary soon, members of the Parliamentary Committee on Energy, Trade, Industry and Tourism announced on Tuesday.
The Committee has concluded its discussion of the proposed laws to amend the Companies and Tax Collection Acts with members announcing that they have agreed to table a joint bill that will go to the next plenary session for a vote. This is harmonizing legislation, based on a relevant European Directive of 2012.
The one proposal that had been tabled was by Ilias Mirianthous on behalf of the EPP, Marios Mavridis on behalf of the parliamentary group of DISY, Alekos Tryfonidis and Michalis Yiakoumis on behalf of the DPA. The other was Kyriakos Hatzigiannis, Onoufrios Koulla and Nikos Figas on behalf of the parliamentary group of DISY and Christiana Erotokritou on behalf of the parliamentary group of DIKO.
Mr. Mirianthous said after the session that "the golden mean was found", a joint recommended, and that they will go with a joint proposal for a law, so that in the next session of the plenary session, it will be passed unanimously and can be implemented.
DISY MP, Marios Mavridis, said in a statement that the aim of the proposed law is to reduce compliance costs for small businesses by submitting accounts that are not as in-depth as fully audited accounts.
"It affects a large percentage of small businesses and will help both reduce costs for those businesses and help them survive," he said."
Mirianthus said he had concluded the debate on the legislative proposals that he and his colleagues, Mr. Mavridis and Michael Yakoomi of the PPP, to amend the Companies Act and the Tax Collection Act to amend the obligation of micro-enterprises to submit fully audited accounts and, in doing so, to submit audited accounts under a different auditing standard.
This standard, he added, is set at the thresholds of €200,000 turnover and €500,000 as a balance sheet amount.
"In this way, those companies that meet these criteria will submit their accounts in a different way, with concise review procedures, therefore, essentially, avoiding this hassle that is created for very small companies, which are mainly family-owned," Myrianthous said.
AKEL MP Kostas Kostas expressed the party's satisfaction with today's outcome, and the fact, he said, that "all parties agreed and we are going to the plenary session of the Parliament with a law proposal."
He said that AKEL contributed positively to the debate and put forward views and suggestions.
"The will of all of us to try to help micro-enterprises was shown in practice," she added.
Ms Erotokritou said that micro-enterprises cannot be subject to the same obligations as large enterprises with inexhaustible resources, human and otherwise. She said there is a European Directive from 2012 which allows Member States to use more simplified, more small business friendly procedures to assist business and help micro businesses over large ones. Erotokritou said that they have identified a gap in Cypriot legislation on this issue, despite the fact that it is allowed by a relevant European Directive.
For this reason, she added, with a legislative proposal by herself and Mr Koulla, who, she said, co-signed the proposal, "we have completed today the discussion of a new legislative regulation that opens new horizons for the small, small and medium-sized and young entrepreneur."
He said the administrative costs now that businesses of up to one size will have to submit accounts to the tax department are being simplified and that they expect that the costs they will have to pay to audit firms to prepare their annual reports will also be reduced.
"In this way we are not only helping small and medium enterprises, but we are also encouraging and helping and incentivising young people to set up their own new business by removing a very big burden both financially and administratively in terms of preparing their annual audited accounts," he added.
He explained that, based on international accounting and auditing standards, this process is much simpler and clearer, the time required is much less, so the bureaucracy involved in preparing annual accounts will be much less and, consequently, the cost and human resources will be much less.
Mr. Yacoumi said in turn, after the end of the session, that they were satisfied that there was a consensual conclusion on the issue as it covered 42% of the companies registered with the company registrar, even though his party had tabled a proposal that provided for companies with a maximum turnover of €700.000 and a value of assets at the date of closing its balance sheet of around €1 million.
But in the context of a consensus, he said, they agreed on the lower amounts of €200,000 and €500,000.
But in the context of a consensus, he said, they agreed on the lower amounts of €200,000 and €500,000.
He also said that the same, in the view of the DPA, should happen for self-employed workers, i.e. a review limit should be set, from €70,000 to €150,000, while above €150,000 accounts should be audited. This, he added, will be seen in another legislative proposal.
Yacoumi added that they would like to increase the amounts further as their own proposal envisaged on the basis of the European Directive, in order to benefit more companies in the future.
[P Myrianthus said that the limits they have set are too low compared to those in other European countries, but they are starting from these low amounts and then when they see that there is a possibility to include larger companies under these standards to increase these amounts.
Source: CNA
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