Future legislation
Government has published a list of proposed legislation for the autumn term. There are 36 pieces of urgent legislation proposed, including a Credit Union (Amendment) Bill, Land Value Sharing and Urban Development Zones Bill, Gambling Regulation Bill, Charities (Amendment) Bill, Co-operative Societies Bill, Companies (Administrative, Governance & Insolvency Amendment) Bill and Limited Partnership Bill.
There is also a list of the 27 Bills currently before the Dail.
Small pension funds
Currently small pension funds have an option to prepare ‘an alternative annual report’ which is not audited, although a limited report from an auditor is attached to such reports. However, small schemes will now require a full audit. See a summary of the new disclosure provision on the pension regulators website.
It is inevitable that the total amount of taxation required to fund public services will increase in the years ahead
Commission on Taxation and Welfare
The Report of the Commission on Taxation and Welfare has been published. The Commission’s terms of reference asked for an overall appraisal of the suitability of the taxation and welfare systems to Ireland’s present and future needs, and the consideration of a number of specific policy matters.
The Commission noted that given Ireland’s demographic profile, level of public debt, and a number of other fiscal risks, it is inevitable that the total amount of taxation required to fund public services will increase in the years ahead.
The Commission recommends broadening the base within and across most tax heads to secure sustainability of the taxation system against future challenges.
Sale and leaseback accounting
The International Accounting Standards Board (IASB) has issued a narrow-scope amendment to the requirements for sale and leaseback transactions under IFRS 16. The amendment adds a requirement to explain how a company accounts for a sale and leaseback after the date of the transaction.
IAASA findings
The Irish Accounting and Auditing Supervisory Authority (IAASA) has consulted on the adoption of a policy on publication of their findings in respect of financial reporting and compliance by public interest entities (ie quoted) companies. Publication of deficiencies in a quoted company’s financial statements may have an untoward effect on the market, but is likely to encourage better compliance.
Turning a cash lump sum into regular taxed rental income is a common way of laundering the proceeds of crime
Money laundering trends
A recent trend in money laundering is for launderers to purchase property, including buy-to-let residential property, through companies that are often beneficially owned by non-Irish nationals.
Frequently the formation agents are still listed as directors or secretary, circumventing the requirement for an Irish or EU-resident director and also facilitating the opening of an Irish bank account in the company’s name.
If a solicitor, accountant or auctioneer is advising on such transactions, they must satisfy themselves as to the source of funds and satisfy themselves as to the identity of the beneficial owners.
The advisor must also perform a sanction check of all the legal persons within the chain of the movement of money or property title.
All the normal risk factors need to be considered when looking at sources of funds, such as the strength of the anti-money laundering procedures in the country of origin, any exchange controls in place in the country of origin, and social media and other online searches on the individuals.
Turning a cash lump sum into regular taxed rental income is a common way of laundering the proceeds of crime. Reporting such transaction when there is any suspicion of money laundering protects the advisor from criminal prosecution.
Assisting a client in such a transaction when the advisor has actual knowledge (ie more than a suspicion) of irregularities is assisting in the layering part of money laundering and itself a criminal activity.
A second recent trend is to use a legitimate business to launder funds. The construction industry is particularly attractive to launderers due to the large size of many construction projects and is frequently used for trade-based money laundering. However, any cash business is exposed.
It has also been noted that there are fraudulent Ukrainian identification documents circulating. These documents are being used for criminal purposes, including people trafficking.
SMPs’ future
An ACCA member studying for a PhD at Ulster University business school is undertaking research on how small and medium-sized accountancy practices (SMPs) in Ireland are responding to challenges and addressing opportunities through service innovation, and is looking for members to respond to a short survey.
The survey should take approximately 15 minutes to complete. The findings will be used to help inform recommendations for interventions to aid SMPs.
