Cyprus Companies Law changes to benefit small companies

Cyprus Companies Law changes to benefit small companies

By: P. Constantinou & Co. Ltd

Cyprus, June 2022. the House of Representatives passed an amending Law, changing the Cyprus Companies Law.

The purpose of the changes is to help small businesses and audit firms reduce costs by simplifying the auditing procedure of the financial statements.

The Law will be in effect from the start of 2023 (January 1st 2023) and will apply to companies with a net turnover of less than €200,000 and a total balance sheet of less than €500,000.

Companies that fall within the above criteria will be able to submit their financial statements for a review (not an audit) by a statutory auditor or audit firm. The much-anticipated amendment is considered essential in order to reduce the administrative load and costs of small businesses and also audit firms.

Clarification

These changes do not apply to parent companies that must provide consolidated financial statements and companies that are regulated/supervised by the Central Bank of Cyprus, the Cyprus Securities and Exchange Commission (CySEC), the Cyprus Superintendent of Insurance, and companies that obtain or hold a qualifying holding in such companies.

Companies can submit their financial statements for review only in cases where they didn’t exceed or ceased to exceed the limits of the two criteria for at least two consecutive years at the date of closing of the balance sheet.

Additional information will be available after the publication of the Law in the Official Gazette of the Republic of Cyprus and with consultation from the Institute of Certified Public Accountants of Cyprus (ICPAC).

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