Good day Betty,

I would just like to enquire about 2017 February financial statements (FS): When should one start to gather information from clients to start with the FS, at which time should it be done and why within that time frame?

Thanks,

Zhantelle

Hi Zhantelle,

The Companies Act requires financial statements of a company to be prepared within 6 months after the financial year end date or such shorter period as may be appropriate to provide the required notice of an annual general meeting.

The information from the client should be gathered regularly enough (monthly, quarterly, by-annually, etc.) to allow yourself enough time to prepare and finalise the statements within the stipulated time frame.

However, the financial statements can be prepared any time after the financial year end, depending on the needs of the business for which the financial statements are prepared. For instance, for a business with a February 2017 financial year end that seeks to apply for a loan from a bank in March, the bank will need the 2017 financials. Thus, if you had been gathering information monthly from the client (as opposed to waiting until year-end), it would be easy to have the financials ready for the bank in March already.

I hope this helps!

Don’t forget that I’m here to answer your questions about the ICBA, or just queries about your accounting at work. All you have to do is email me your query with a copy of your ICBA membership certificate!