Guarantee Company
Public Guarantee company
Public Guarantee companies are governed by Part 18 of the Companies Act 2014 and are called Companies Limited by Guarantee (CLGs). A private guarantee company with a share capital is a Designated Activity Company (DAC) and is governed by Part 16 of the Companies Act 2014.
Company Limited by Guarantee
A CLG must annex to its annual return, the following:
- balance sheet,
- profit and loss account (or income and expenditure account),
- directors’ report,
- auditor’s report.
There must be a general certification certifying the financial statements and reports in total to be a true copy of the accounts and reports as laid before all members at the AGM and this must be signed by a director and the secretary.
The directors report does not however have to comply with Section 329 and Section 325(1)(c) of the Companies Act 2014.
A Company Limited by Guarantee can avail of the audit exemption/dormant company audit exemption and the exemptions available to small/medium sized companies. Such a company can qualify for audit exemption, however a member can object to this under Section 1218 of the Companies Act 2014.
CLG’s that qualify are not required to file any financial statements under Section 1220 of the 2014 Act and are limited to those which are formed for charitable purposes and stand exempted by an order made by the relevant authority (Charities Regulatory Authority/ Commissioner of Charitable Donations and Bequests in Ireland). Instead they file a special statutory auditors report unless they are audit exempt.
A Designated Activity Company Limited by Guarantee (DAC)
A DAC, limited by guarantee, is a private guarantee company and must annex to its annual return the following items:
- balance sheet,
- profit and loss account (or income and expenditure account),
- directors’ report,
- auditor’s report.
There must be a general certification certifying the financial statements and reports in total to be a true copy of the accounts and reports as laid before all members at the AGM and this must be signed by a director and the secretary.
The directors report does not however have to comply with Section 329 and Section 325(1)(c) of the Companies Act 2014.
Designated Activity Company Limited by Guarantee can avail of the audit exemption/dormant company audit exemption and the exemptions available to small/medium sized companies. Such a company can qualify for audit exemption, however members can object to this under Section 334 of the Companies Act 2014.
DACs that qualify are not required to file any financial statements under Section 996 of the 2014 Act and are limited to those which are formed for charitable purposes and stand exempted by an order made by the relevant authority (the Charities Regulator). Instead they file a special statutory auditors report unless they are audit exempt.