Keeping books of account
The directors of every company are responsible to maintain proper books of account which are necessary for the preparation of financial statements. Proper books of account shall be sufficient for the presentation of an accurate and fair picture of the affairs of the company as well as an explanation as to its transactions.
The Directors are also responsible to ensure that the company prepares a full set of financial statements that give a true and fair view in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and the requirements of the Cyprus Companies Law, Cap. 113.
The Management Report must accompany the financial statements. The Management Report is prepared by the Directors and its content is specified in the law. Small sized companies and small and medium sized groups are exempted from the preparation of the Management Report provided certain criteria are met.
Audit or Review
All Cyprus registered companies must have their financial statements audited or reviewed and signed by a Cyprus registered auditor.
The auditors are appointed at the Annual General Meeting (AGM) to hold office from that AGM until the next AGM and to sign the related auditor reports or auditor conclusions of the financial statements of the company. The audit is conducted in accordance with International Standards on Auditing (ISA).
Submission of the annual return
All Cyprus registered companies are required to file an annual return accompanied by the corresponding year’s financial statements, including the auditor’s report or auditor’s conclusion, to the Department of the Registrar of Companies.
The annual return includes details of the registered office, the shareholders, authorized and issued share capital, the directors, and the company secretary.
The registrar of Companies will impose penalties for the late submission of annual returns.
* The above article does not constitute legal advice but is intended as general guidance on the financial reporting requirements of Cyprus registered companies.
