SAIPA Technical & Standards Department
On 11 January 2006, The Close Corporations Amendment Act of 2005, Act No. 25 of 2005 became effective. This amendment expanded the provisions for the qualification of an accounting officer, and included the option of a close corporation to be appointed as an accounting officer.
Essentially, the amendment redefines the meaning of “firm” and now allows that a CC may be appointed as the accounting officer of another CC.
This amendment creates an amount of uncertainty when it comes to SAIPA membership of an accounting firm. The uncertainty results from different interpretations of sections 60(1), section 60(4) (a) (i), and section 60(4) (a) (iv).
To clarify this, SAIPA interprets the relevant provisions to mean the following:
·SAIPA will only issue practice numbers to suitably qualified individuals (i.e. membership numbers) as accredited by the institute.
·SAIPA will only issue a business practice number, for purpose of section 60(4) (a) (iv), to a Close Corporation that has suitably qualified members/shareholders.
What About Private Companies?
The shareholding in a private company is not verifiable, as the registration certificate from CIPC only reflects the appointed directors. This therefore prohibits SAIPA from issuing business practice numbers to private companies, as it is not possible to ensure that all shareholders are qualified accounting officers in their individual capacity.
Members acting in their individual capacity are not required to apply for a business practice number to act as an accounting officer; such members should still use their SAIPA member number to accept appointments as accounting officers.
Members who plan to start a practicing firm can register the Pty at CIPC, and use this as the business vehicle and use their individual membership number as the practice number.