All Cypriot companies, as well as other corporate entities (branches, representative offices, etc.), operating in Cyprus, are obliged to keep accounting and submit audited financial statements. This obligation exists regardless of whether the person who is the proprietor of the enterprise (Cypriot or foreign), whether it is tax resident in Cyprus, whether it leads activities in Cyprus or by the outside it.

Accounting requirements

In accordance with the laws and tax all the requirements of the Cyprus companies are required to keep books and records that must be kept at the registered office of the company and be available at any time for the official test. Companies that are not registered as VAT payers in Cyprus, should prepare accounting reports not less than once a year; and the company, registered for VAT - not less than once in a quarter.

All transactions of the company, conducted during the year must be entered in the books of account.

For proper preparation of the financial statements of the company must be provided to the accountants of the following documents:

a) an extract from the Bank for Cypriot and foreign companies,
b) notice on the execution of a clearing transaction,
c) invoices for goods sold,
(d) invoices for purchased goods,
(e) the loan agreement,
f) purchase and sale agreements,
(g) accounts for the cost,
h) investment treaties,
(i) the financial statements of the invested companies (preferably audited and the relevant IFRS),
(j) the brokerage statements to invest in the company, registered on the stock exchange,
k) accounting of the inventories,

Accountants prepare financial statements and send it to the auditors for audit.

Requirements to the audit of the

The auditors must be independent from the accountants or other officers of the company (Directors, secretaries, etc.). In accordance with the legislation, the auditor may not simultaneously be a accountant of the company.

Auditors shall be appointed by the Directors. By request of the client, its financial reports can be audited in another audit firm than the one that has any relation to an Internet provider, providing other services to the Cypriot company.

Audit - it is carefully regulated sphere, and ICPAC periodically conducts its quality control, to ensure that audits are carried out in accordance with the standards of quality and with International Auditing Standards.

The auditor is not simply checks the work of the accountant who prepared the financial statements of the company. He must carefully analyze:
• the complexity of operations,
• activities of the company,
• volume of transactions,
• the cost of the assets involved,
• non-cash transactions,
• the revaluation of assets/ possible reduction in the value of the/ possible non-performing debt,
• General audit risk taking into account all of the above.
Do not prepare consolidated financial statements:

• Small group of companies.
• The company, which in turn is a subsidiary of the other parent, and the parent company prepares consolidated financial statements, which include the results of the subsidiary.

Requirements for submission of papers

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Regulatory reporting in the Greek language should be sent to the Registrar of companies within 12 months after the end of the reference period.
Although the Registrar of companies has the right to liquidate the company, if the statement is not filed in time, usually this is not happening. For delay in submission of statements penalties are not charged.

The audited financial statements should be prepared annually. They are submitted to the tax authorities together with the tax Declaration.