Filing AFS or an FAS with the annual return
Whether a South African client files annual financial statements or a financial accountability supplement with its CIPC annual return, and iXBRL.
By Achekam · · 4 min read · For Accountants & audit firms in South Africa
The annual return is ready to file, and the junior preparing it reaches the step that asks about financial statements. The client is a small private company. Its statements were compiled, not audited. Does CIPC want them? Or does it want the supplement instead? And if the statements go to CIPC, in what format?
These questions have clear answers, but they depend on the type of company and on whether it must be audited. Getting them wrong has consequences that arrive long after the annual return seemed to be finished.
Companies that must be audited file their audited statements
CIPC says companies that must be audited must file a copy of their latest approved audited financial statements on the date they file their annual return.
For these companies there is no choice. The audit must be complete and the statements approved by the time the annual return is filed. That links two timetables that are often managed separately: the audit engagement and the company secretarial work. If the audit runs late, the annual return either waits or is filed without what CIPC requires. For an audited company, the statements themselves, not a supplement, go with the return.
Others file statements or a financial accountability supplement
For companies outside the audit category, CIPC gives an alternative. It says a private company that does not file a full set of financial statements with its annual return must file a financial accountability supplement (FAS), and that AFS or an FAS are filed through the CIPC e-services portal.
CIPC's step-by-step guide on annual returns says it is mandatory for companies, other than external companies, and for close corporations, to submit either annual financial statements, through iXBRL, or a financial accountability supplement when filing annual returns. The CIPC step-by-step guide on filing annual returns walks through the filing and the statements-or-supplement step, and is the document to give anyone in the firm who files returns.
So the decision for a company outside the audit category looks like this:
| Company | What accompanies the annual return |
|---|---|
| Must be audited | Latest approved audited financial statements |
| Not audited, files full statements | The statements, through iXBRL |
| Not audited, does not file full statements | A financial accountability supplement |
| External company | Check CIPC's guidance: the step-by-step guide excludes external companies from this requirement |
Filed on the same day
CIPC's information guide on annual returns says companies must file audited financial statements, independently reviewed statements or a financial accountability supplement on the same day they submit their annual return.
"The same day" removes any idea that statements can follow later. Plan the work so that whichever document applies is ready before the annual return deadline, not just the return itself. Working out that deadline is covered in the CIPC annual return due date.
iXBRL for statements that are filed
Where statements are filed, the format matters. CIPC says it mandated iXBRL digital reporting of annual financial statements for all qualifying entities from 1 July 2018. The step-by-step guide's reference to statements "via iXBRL" reflects that.
For a firm, iXBRL is a technical step at the end of the statements process: the approved statements are tagged so CIPC's systems can read them. The tagging must follow CIPC's taxonomy, and the file must pass validation.
Investigations and fines for not filing
CIPC's step-by-step guide warns that not filing AFS or an FAS after filing annual returns will result in an investigation for non-compliance with the Companies Act, which may lead to prosecution or an administrative fine.
That is the trap in the opening example. A junior who files the return and leaves the statements question for later has not finished the job; they have started an investigation. Make the statements or supplement part of the same task, closed only when both are filed.
What Achekam's iXBRL packs can and cannot do
Achekam turns a set of financial statements or a trial balance into an iXBRL file, checks it with its own validation, and packs it in a ZIP file with the validation report. This is available under Financial Intake's iXBRL Projects, or from the Studio's publish step.
Two limits are important, and the firm should plan around them:
- Test packs only, for now. A production iXBRL pack is refused until someone uploads and approves the official CIPC taxonomy package. The built-in taxonomy is a partial list Achekam wrote, so only TEST packs can be made with it.
- No filing with CIPC. Achekam does not file iXBRL with CIPC. Filing remains a step the firm performs on CIPC's own systems.
A test pack is still useful. It shows how the statements will be tagged and surfaces validation issues early, before the real filing. But it is not a file to submit to CIPC. How to use test packs in the firm's process is described in iXBRL test packs for CIPC.
A short checklist for each company client's annual return:
- Is the company in the audit category? If so, have its audited statements been approved?
- If not, will it file full statements or a financial accountability supplement?
- If statements, is the iXBRL file prepared and validated on CIPC's taxonomy?
- Are the return and the statements or supplement filed on the same day?
- Is the CIPC confirmation for both kept on file?
For every company client whose annual return falls due in the next quarter, record now which document will accompany it: audited statements, other full statements or a supplement. Where it is audited statements, check the audit timetable finishes in time.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
