Exemption to Submit Audited Financial Statements

Certain FSPs received a request from the FSB for additional information regarding their financial statements which, for most FSPs, are due by the end of this month.

Category I FSPs who are registered as companies, and who do not receive client funds or premiums are required to submit either audited financial statements or, if so permitted in terms of the Companies Act, to have the statements independently reviewed. The company need not submit audited or independently reviewed financial statements where all the shareholders in the company are also directors.

Category I companies that receive client funds or premiums, and where the company is authorised for any financial product other than Long-term Insurance subcategory A and/or Friendly Society benefits, are required to have their financial statements audited.

All Category II, IIA, III and IV FSPs are required to submit audited financial statements.

If the company’s financial statements were audited or independently reviewed, one of the following documents need to be submitted:

  • auditor’s report
  • independent reviewer’s report or
  • independent compiler’s report.

In terms of Regulation 26(2) of the Companies Act, a company must calculate its PIS score at the end of each financial year. Please note details below – a urine sample is not required.


In terms of Regulation 26(2), the new definition is as follows:

For the purposes of regulations 27 to 30, 43, 127 and 128, every company must calculate its ‘public interest score’ at the end of each financial year, calculated as the sum of the following –

a) a number of points equal to the average number of employees of the company during the financial year;
b) one point for every R 1 million (or portion thereof) in third party liability of the company, at the financial year end,
c) one point for every R 1 million (or portion thereof) in turnover during the financial year; and
d) one point for every individual who, at the end of the financial year, is known by the company –
  in the case of a profit company, to directly or indirectly have a beneficial interest in any of the company’s issued securities; or
  in the case of a non-profit company, to be a member of the company, or a member of an association that is a member of the company.

Please see FAIS Circular 193/2011 for more details regarding the exemption.

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