Gibraltar: The Gibraltar Companies (Accounts) Ordinance 1999

Last Updated: 20 October 2010
Article by Jonathan Stagnetto

Accounting And Disclosure Requirements

The Companies (Accounts) Ordinance 1999 implemented the EU 4th and 7th Directives which require public disclosure of certain corporate financial information on an annual basis.

The manner in which the law has been adopted in Gibraltar takes advantage of all exemptions available to smaller companies, both in the amount of details that need to be shown, and in the requirements for an annual audit as set out below. In addition there are transitional provisions in place which mean that no accounts have to be filed until a company reaches a trading period commencing on or after 1st April 2000. Hence, as an example, if a company has a 31st March year end, the first accounts that will need to be filed will be those ending on 31st March 2002. These accounts must be delivered to the Gibraltar Companies Registry not later than 13 months after the end of the relevant financial year (in our example not later than 30 April 2003).

It is important to note that these rules relate to the filing of corporate accounts at the Gibraltar Companies Registry ONLY, and have no bearing whatsoever with any fiscal obligation to file accounts with the Gibraltar Income Tax Office.

What Information Is Required

Medium Sized Companies

The definition of this type of company is one that fulfils 2 of the following criteria:

  1. A turnover less than or equal to GBP £19.2 Million.
  2. A Balance Sheet total less than or equal to GBP £9.6 Million.
  3. An average number of employees less than or equal to 250.

These companies may provide abridged Profit and Loss Accounts. More details may be provided on request.

Small Sized Companies

The definition of this type of company is one that fulfils 2 of the following criteria:

  1. A turnover less than or equal to GBP £4.8 Million.
  2. A Balance Sheet total less than or equal to GBP £2.4 Million.
  3. An average number of employees less than or equal to 50.

Most companies incorporated in Gibraltar will fall into this category. These companies need only file a Balance Sheet which will be required to be signed by a maximum of 2 Directors or, in the case of companies with only 1 Director, by the Sole Director.

No audit of this type of company is required unless there is trading with Gibraltar customers (i.e. the selling of local goods and services to local residents), and there is no need for the preparation of a Directors Report.

The minimum contents of the Balance Sheet are as follows for companies qualifying as small, and have been laid-out in the Sample Format Balance Sheet attached to this Information Sheet:

  1. Called up Capital not paid
  2. Fixed assets (separating Intangible, Tangible and Investments)
  3. Current Assets (disclosing figures for Stock, Debtors, Short Term Investments and Bank Balances)
  4. Prepayments and accrued income
  5. Creditors due within one year
  6. Creditors due after more than one year
  7. Provisions and charges
  8. Accruals and deferred income
  9. Capital and reserves (showing separate reserves)

Unlimited Companies and Limited Partnerships are exempted from having to file accounts unless their members are:

  1. limited companies or,
  2. unlimited companies whose members are limited companies.

Subsidiaries

There is a general exemption available to subsidiary companies where the parent is within the EU and subject to the requirements to prepare full consolidated accounts. There must be an annual declaration by the members to apply the exemption and the parent company must declare that it guarantees the commitments entered into by the company. The exemption must also be disclosed in the notes on the consolidated accounts of the parent company.

This exemption does not apply to a company listed on a stock exchange in any EU Member State.

The same exemptions apply to small groups as to small companies (identical criteria for qualification, but applying to the aggregate figures for all companies within the group).

What Are The Penalties For Failure To Comply?

Six months after the due date for filing, the Companies Registrar may choose to inform the Minister responsible of a company's failure to file accounts. The Minister may then demand a GBP £100 penalty fee. If this penalty is paid within one month and the accounts are delivered within 12 months of then date of penalty, then no further action will ensue.

If the company fails to pay the penalty, then the Registrar may proceed against its officers for an offence and a fine (currently up to GBP £500) may be imposed. It is not clear what the penalty for continued failure to file accounts would be, but there is no specific mention of anything further than a level 3 fine (GBP £500) being imposed.

Are There Any Advantages To Filing Accounts?

The filing of accounts at the Companies Registry will give added credibility to a company and ensure compliance with EU law giving rights of freedom of movement and establishment within the EU. It will also serve to elevate the international profile of Gibraltar as a well-regulated and reputable jurisdiction.

The requirement that the accounts be signed by the Directors reinforces the fact that the Board have actual management and control of the company, and through the use of abbreviated accounts, no disclosure of ultimate beneficial ownership is required.

Is There An Alternative?

We do not believe that these new requirements are fundamentally detrimental to our clients interests. However, if they are not acceptable to you, we can always arrange for a new company to be established in an alternative jurisdiction where accounts are not required to be filed and/or re-domicile your existing company to a preferred jurisdiction.

What Do We Require From You?

In order to prepare accounts we need you to provide us (in cases where we do not already operate and manage bank accounts) with information as to the company's financial operations throughout the chosen financial year. If you are already maintaining books of account elsewhere, there are no requirements to keep the records and documents in Gibraltar.

All that we require will be for the Directors to enter the balances on our Sample Balance Sheets from which we can then prepare the final document for filing at the Companies Registry for a nominal fee.

Where the company is large enough to require an audit, this can be carried out by your usual auditors locally, and we can then arrange for the review and signing of the report by a Gibraltar registered auditor.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.