Brexit
The Withdrawal of the United Kingdom from the European Union (Consequential Provisions) Act 2020 replaces large sections of the 2019 act of the same name. The 110 pages of dense and technical legislation shows just how intertwined our two jurisdictions had become.
An extensive portion of the legislation is designed to protect the Common Travel Area and the Good Friday Agreement, and to facilitate the special position of Northern Ireland in areas such as healthcare, third-level student support and other matters.
The act also amends the employment permit legislation and the recognition of certain UK qualifications – ACCA is already recognised in Ireland.
Company law is substantially amended, with Part 17 of the Companies Act 2014 having a new chapter 7A inserted, which deals with the regulations for central securities depositories.
Insurance and financial services law is amended, with changes to the European Union (Insurance and Reinsurance) Regulations 2015, the European Union (Insurance Distribution) Regulations 2018 and the European Communities (Settlement Finality) Regulations 2010.
There are also substantial changes to tax legislation. In most cases, this is achieved simply by adding ‘or in the United Kingdom’ in any place where the original legislation referred to ‘member state’.
In addition, there are substantial additional provisions in the area of customs.
For more information, read the legislation.
Companies Act 2020
The measures in the Companies (Miscellaneous Provisions) (Covid-19) Act 2020, such as virtual AGMs, have been extended to 9 June 2021.
Property services
New property services regulations 2020, which came into force on 30 November 2020, have imposed additional requirements on auctioneers, estate agents and property service agents.
The regulations specify a number of conduct and behaviour rules, the provision of information, changes to client money rules, the holding of service charge and sinking fund monies, and the holding of directorships of multi-unit developments.
Credit union changes
After supporting 117 credit union mergers projects involving 212 credit unions, the Credit Union Restructuring Board has finally reached the end of its life.
The Dissolution Act dissolves the Credit Union Restructuring Board and either ceases or transfers the board’s functions back to the minister for finance.
The act was signed on 6 December 2020 but at the time of writing was awaiting a commencement order.
Covid-19 risks
The South African Independent Regulatory Board for Auditors, the International Ethics Standards Board for Accountants (IESBA) and the International Auditing and Assurance Standards Board have jointly issued a staff guidance document on navigating the heightened risks of fraud and other illicit activities during the Covid-19 pandemic.
Meanwhile, CPA Canada and IESBA have jointly released a document on the heightened risks of money laundering, terrorist financing and cybercrime in the Covid-19 environment.
The EU’s Money Laundering and Terrorist Financing Regulations 2019 imposed an additional requirement for all designated persons (all practices and AML-regulated entities) to have a system in place ‘to report a contravention of this act internally through a specific, independent and anonymous channel’. A whistleblowing procedure will need to be put in place for all entitles covered by the legislation.
AML monitoring
Members in practice in Ireland can expect a significant increase in the number of anti-money laundering (AML) monitoring visits in the next few months.
Preparing for a visit requires having the following items ready (as these are standard documents, they will need tailoring to the specific circumstances of your firm):
- guidance
- firm’s procedures manual
- guidance on preparing a firm-wide risk assessment – a sample blank one can be supplied on request from advisory services
- standard individual client risk assessment –
guidance
example form - example internal reporting form for staff
- proof of having provided some AML training guidance on the training required
- A formal anonymous whistle-blowing procedure in your practice for reporting breaches of the AML requirements to the anti-money laundering reporting officer.
Reciprocal audit
Since the UK left the EU, the UK and the Republic of Ireland are third countries to each other. After 31 December 2020 UK auditors who wish to audit entities incorporated in the Republic of Ireland will need to be separately registered under a different process as set out in Irish law for the first time.
The UK regulator, the Financial Reporting Council, has agreed a memorandum of understanding on reciprocal arrangements with the Irish Auditing and Accounting Supervisory Authority (IAASA). The agreement facilitates Ireland’s ability to register UK statutory auditors as statutory auditors in Ireland by meeting the requirement in Irish law that a third-country auditor cannot be approved as a statutory auditor in Ireland unless reciprocal arrangements with that third country are in place.
For a third-county auditor to be approved as a statutory auditor in Ireland, the Companies Act 2014 requires that:
- he or she passes an aptitude test on subjects relevant to statutory audit in Ireland, or can demonstrate sufficient knowledge of the same
- he or she holds an appropriate qualification
- he or she is of good repute
- reciprocal arrangements with the third country are in place which enable an Irish statutory auditor to carry out audits in that third country on fulfilment of requirements that are no more onerous than the requirements for the approval of third-country auditors in Ireland
It should be noted that UK statutory auditors who are included on the audit register in Ireland remain able for the time being to audit entities in Ireland without having to reregister as statutory auditors in Ireland.
