Every South African company must prepare Annual Financial Statements (AFS) — the formal, once-a-year report of how the business performed and what it's worth. If a bank, CIPC, SARS or the NCR has ever asked you for "your AFS", this is what they mean.
What's inside a set of AFS
- Statement of Financial Position (balance sheet) — what you own vs owe
- Statement of Comprehensive Income (profit & loss) — income vs expenses
- Statement of Cash Flows — how cash moved during the year
- Statement of Changes in Equity
- Notes and accounting policies — the explanations behind the numbers
- A directors' report, and the accountant's compilation report or an independent review/audit report
Who must prepare AFS — and to what level
Under the Companies Act every company prepares AFS within six months of financial year-end. What differs is the level of assurance:
- Audit — required for public companies and private companies above certain public-interest score thresholds.
- Independent review — many private companies in the middle.
- Compilation — most small owner-managed companies only need AFS compiled by an accountant, with no audit.
Your accountant works out your public-interest (PI) score from turnover, employees, debt and shareholders to confirm which applies.
Who asks for them
- CIPC — companies file annual returns, and certain companies must submit AFS (or a financial accountability supplement) with them.
- Banks and funders — almost always want the latest AFS for finance applications.
- NCR — registered credit providers must submit AFS annually.
- SARS — the ITR14 company tax return is built from the AFS numbers.
The cheap way to get AFS-ready
The expensive part of AFS is usually not the accountant — it's the catch-up bookkeeping before the accountant can even start. If your ledger is clean and reconciled, compiling AFS is quick.
360books produces a one-click AFS pack — balance sheet, profit & loss, cash movement, trial balance, fixed-asset register, aged debtors and creditors, VAT summary and a pre-filled directors' report template — everything your accountant needs to compile and sign the statutory AFS, straight from your live books. Accountants also get a free seat, so you can hand over access instead of emailing spreadsheets.