In order to be able to benefit from the small companies exemptions, the company must be meet the conditions as a small company. Section 280A of CA 2014 (assuming it is a standalone company) sets out the requirements in order to be considered a small company. One of the conditions to be a small company is that the company cannot be a company that is listed in Schedule 5 of CA 2014.
The transposition by Ireland of the EU Insurance Distribution Directive – Directive (EU) 2016/97 of the European Parliament and of the Council (the IDD) later this year is likely to have significant implications for those firms authorised by CPA Ireland under the IIA, including removing the need for certain firms to hold IIA authorisation. As part of the transposition of the IDD, it is likely that ‘insurance policies’ will be removed from the scope of the IIA and therefore from the scope of your Institutes Investment Business Regulations. This is expected to apply from 1 October 2018.
When the IDD Regulations take effect firms that are actively involved in advising on or arranging insurance products, including insurance-based life and pension products, must be registered for such activities directly by the Central Bank of Ireland. Firms should note that where a firm introduces or refers a client to a third party for the purposes of arranging the purchase of an insurance product and that firm has no further role in the transaction, that firm will not be required to be registered with the Central Bank and will continue to be authorised by their Institute until 1 October 2018. This is because the act of introduction or referral in respect of an insurance product does not fall within the definition of ‘insurance distribution’ and is not subject to the IDD. The IDD does not apply to persons with another professional activity, such as accountants, who provide advice on insurance cover on an incidental basis in the course of that other professional activity, nor to the mere provision of information of a general nature on insurance products, provided the purpose of that activity is not to help the customer conclude or fulfil an insurance contract, e.g., preparing calculations of the maximum amount a client might contribute to a pension.
Given that IDD requires the accountancy company to be authorised by the Central Bank then it is excluded from being considered a small companies regardless of whether they meet the thresholds or not. As it cannot be considered a small company it cannot file abridged financial statements nor can it claim audit exemption as Section 358 CA 2014 requires a company to meet the conditions in Section 280A in order to qualify for exemption.
In addition as the company cannot be considered small, it cannot apply Section 1A of FRS 102 and therefore must apply full FRS 102 and the full requirements of Company law.