Changes to the Financial Reporting Act 2013 mean a large number
of small-to-medium enterprises (SMEs) will no longer need to
prepare general-purpose financial statements. Instead, SMEs
will need to prepare new special purpose financial statements to
minimum requirements set by IRD.
Under the Act, New Zealand private companies will not have to
produce general-purpose financial statements unless they are
"large". A company is "large" if it:
- Has total assets of more
than $60 million; or
- Has total revenue of more
than $30 million.
On 13 November 2013 IRD released an officials' issues paper,
Minimum financial reporting requirements for companies, outlining
the proposed minimum requirements for special-purpose financial
statements. Click here for an overview
of the Proposed Minimum Financial Reporting Requirements.
According to Commerce Minister Craig Foss the changes lift the
financial reporting burden from many companies, allowing them to
"focus their time and energy on growing their businesses,
innovating and creating jobs."
The Minimum Reporting Requirements are not yet set and
submissions can be made on the IRD Issues Paper up to 20 December
We are not in the business of providing accounting or financial
advice. We will however be keeping an eye on developments as they
impact SMEs and will keep you updated.
- Kylie van Heerden.