Win with Zuydamzest!

Cooking , ,

Who doesn’t enjoy a proper salad? Especially one with bacon!

 

Henk van Zuydam from Zuydam Konsult is cooking with food consultant, Heleen Meyer, in a series of short cooking episodes.

 

In this, the third episode, Henk and Heleen prepare a scrumptious salad.

WATCH THE EPISODE (https://www.rustgold.co.za/zuydamzest/)

 

Zuydam Konsult is a Xero Accounting Silver Partner. Zuydam is passionate about partnering with tools that streamline and automate their clients’ accounting processes. Xero is a cloud-based accounting system for small to medium sized businesses.

 

We want to add some zest, not only in managing your business’ finance, but also in your kitchen with our #ZuydamZest – Win an AMC Chef’s Pan competition.
Win a legendary AMC 24 cm Chef’s Pan worth R3300!

 

Enter to win: like our page, tag a friend and answer the easy question:

What are the three brand values that was represented in the three ZuydamZest cooking episodes? (Clue:  Zuydam slogan)

@amccookware

 

CLICK HERE TO ENTER (https://web.facebook.com/zuydamkonsult?_rdc=1&_rdr)

 

Stay in contact

e-mail: info@zuydam.co.za

Visit our website: www.zuydam.co.za

 

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

When should financial statements be audited, reviewed or compiled?

Auditing , , , ,

The Companies Act of South Africa (the Act) requires all companies to prepare financial statements within 6 months after the end of its financial year. A very popular question among business owners with regards to financial statements is whether the statements should be independently audited, reviewed or compiled. In determining the engagement type, the Act prescribes the following criteria to be applied:

 

Audited financial statements

 

  1. Any profit or non-profit company that, in the ordinary course of its primary activities, holds assets in a fiduciary capacity for persons who are not related to the company, and the aggregate value of such assets held at any time during the financial year exceeds R5 million;
  2. Any non-profit company, if it was incorporated:
    • directly or indirectly by the state, a state-owned company, an international entity or a company; or
    • primarily to perform a statutory or regulatory function in terms of any legislation, a state-owned company, an international entity, or a foreign state entity, or for a purpose ancillary to any such function;
  3. Any other company whose public interest score in that financial year is:
    • 350 or more; or
    • at least 100, but less than 350, if its annual financial statements for that year were internally compiled.

 

How to calculate your public interest score, to determine if you exceed 350 points or not:

  1. a number of points equal to the average number of employees of the company during the financial year;
  2. one point for every R1 million (or portion thereof) in third-party liabilities of the company, at the financial year end;
  3. one point for every R1 million (or portion thereof) in turnover during the financial year; and
  4. one point for every individual who, at the end of the financial year, is a member of the company, or a member of an association that is a member of the company.

 

Independent review of financial statements

 

The Act prescribes that an independent review of a company’s annual financial statements must be performed if the following apply and the company does not select to be voluntarily audited:

 

If, with respect to a company, every person who is a holder of, or has a beneficial interest in, any securities issued by that company is not a director of the company, that financial statements should be independently reviewed.

 

A company and its directors may choose to be voluntarily audited or reviewed if they wish to engage in an assurance engagement, although it has not been prescribed by the Act.

 

Compiled financial statements:

 

If none of the above-mentioned requirements has been met, the financial statements may be compiled.

 

With compilations, or compiled financial statements, the outside accountant converts the data provided by the client into financial statements without providing any assurances or auditing services.

 

If you need any assistance with your engagement in financial statements, do not hesitate to contact our friendly staff.

 

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Ring-fencing of assessed losses of certain trades – Part 2

Tax , , , ,

Section 20A of the Income Tax Act[1]ring-fences losses incurred by natural persons from certain trades under specific circumstances. If applicable, the natural person will not be able to set off the loss incurred from that trade against the income from any other trade (such as salary or other professional income) and may only set off the loss against future income derived from the trade to which the loss relates.

 

The first requirement for section 20A to apply, is that the natural person must fall within the highest income tax bracket during the relevant year of assessment.[2] The second requirement relates to the nature of the trade carried on by the natural person and the fact that the person has incurred losses in respect of that trade for at least three of the last preceding five years of assessment.[3]

 

There is, however, an exemption to section 20A. The losses incurred in respect of the specific trade will therefore not be ring-fenced if the natural person can prove that the trade constitutes a business in respect of which there is a reasonable prospect of deriving taxable income (other than a taxable capital gain) within a reasonable period of time.

 

The factors to take into consideration include the proportion of gross income derived in relation to the allowable deductions for the relevant year of assessment, the level of activity and the amount of expenses incurred in respect of advertising or promoting the trade and whether or not the trade is carried on in a commercial manner.  In respect of the latter requirement, consideration must be given to the number of full-time employees, the commercial setting of the premises where the trade is carried on, the extent of the equipment used exclusively for purposes of carrying on that trade and the time the natural person spends at the premises conducting the business.

 

Other factors include the number of years during which losses were incurred in proportion to the period in which the trade was carried on (considering unexpected events giving rise to the losses and the nature of the business involved), business plans and changes to ensure taxable income in future and the extent to which assets of the business are available for recreational or personal use.

 

Please note that the exemption in section 20A(3) will not apply if the trade is listed in section 20A(2)(b)  and in carrying on the trade the natural person has incurred losses in at least six of the last ten years of assessment (ending on the last day of the relevant year of assessment).

 

[1] No. 58 of 1962

[2] Section 20A(2)

[3] Section 20A(2)(a) and (b)

 

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

Is it possible to backdate an agreement?

Contracts , , ,

A popular question which comes up during a consultation with a client when the drafting of commercial documents is discussed is, “what is the effective date of the transaction?” It is common practice that the effective date be expressly defined in the agreement, this is to indicate when the agreement will come into force and effect. The effective date of a transaction is of great importance especially when there are certain conditions which must be adhered to prior and/or after the date on which the agreement was signed by the relevant parties.

 

In some instances, the effective date of an agreement will either be set on an earlier or later date than on which the agreement was signed by the parties. It is often found that the effective date of an agreement is earlier than the signature date, which can also be referred to as backdating of an agreement. Despite the fact the aforesaid is permissible, the effect of backdating any agreement must not be overlooked by parties. Backdating any agreement means that the agreement binds the parties retrospectively from the earlier date.

 

Due to the retrospective effect of the agreement, it is necessary that the parties ensure that no representations are made during negotiation stages and/or signature of the agreement which they know to be untrue and/or not possible to adhere to. In cases where a misrepresentation is made and lead to certain losses, it can result in one party instituting civil procedures against the other. Parties must declare all facts known to them which may affect the transaction between the signature and effective date to avoid situations where a party to the agreement suffer losses which could result to civil and/or criminal liability. Furthermore, should all obligations and terms of the agreement be of such nature that they have been executed timeously and the effective date is earlier than the signature date, same must be properly recorded in the agreement which will only be signed at a later stage.

 

Although it is possible to backdate an agreement, it is advisable to ensure that parties timeously approach professionals which specialise in the drafting and implementing of commercial documentation to properly record the agreement between the parties.

 

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

When to make use of the small claims court

Litigation , , , , , , ,

This article discusses claims making use of the Small Claims Court. It specifies what the benefits are of approaching the Small Claims Court and who would have locus standi to do so. The article then establishes what Small Claims Court proceedings entail and briefly provides relevant information regarding judgments by this Court.

 

The Small Claims Court provides a prompt and inexpensive way to resolve minor disputes. It is meant for the ordinary man and woman on the street who cannot afford civil litigation. In particular, the Small Claims Court can benefit the destitute and indigent in South Africa to be able to access justice in a very informal, cost-effective, and user-friendly manner.

 

The Small Claims Court is governed in terms of the Small Claims Court Act 61 of 1984 (‘the Act’) which is established for a time and cost-effective mechanism for those who have a claim against another party. The Small Claims Court is for anyone who wants to institute a minor civil claim against someone else. You can also institute claims against companies and associations.

 

However, the claims are limited to amounts that are less than R15 000. This excludes the State, meaning a person cannot, for example, make a claim against a local municipality. Claims brought to the Small Claims Court are dealt with quickly and cheaply without claimants having to appoint an attorney, and anyone, except juristic persons, are allowed to make use of this forum.

 

What does the process entail?

 

The procedure of lodging a claim in the Small Claims Court is fairly easy and straightforward. As in the case of most litigious claims in other courts, claims should initially be instituted by way of a letter of demand, which must be sent by registered post or be hand-delivered. In the letter of demand, one should set out all the relevant facts which give rise to one’s claim, and specify the amount being claimed. The party instituting the action should give the opposing party 14 working days in order to settle the claim, which is calculated from the date of receipt of demand by the defendant.

 

The Act provides that upon proof submitted to the clerk of the court that the requirements regarding the letter of demand have been complied with; and if the clerk of the court is satisfied that the plaintiff is a natural person; and that the summons comply with the prescribed requirements, the clerk of the court shall set a date and time for the hearing of the action and issue the summons. The summons will then be served on the defendant personally or by the sheriff of the court.

 

The hearing:

 

The claimant and the defendant must appear in court in person and the hearing will be chaired by the commissioner. Commissioners in the Small Claims Court are usually experienced legal practitioners. Remember that all the documents on which one’s claim is based should be brought to the hearing, as there is no point in showing up empty-handed. The Small Claims Court proceedings are basic and straight-forward. No legal representatives such as attorneys or advocates are involved in the proceedings, which contributes to the cost-effective nature of this mechanism. As the proceedings begin, answer any questions that the commissioner of the court may ask.

 

The judgment:

 

After the hearing of the action, the judgment will be given by the commissioner, which becomes final and enforceable. If the commissioner grants judgment in your favour, he or she will usually ask the defendant how the debt will be settled.  The commissioner can make an order for payment by instalments.  If no such order is made and the defendant does not pay or settle the judgment within two weeks, one can enforce this judgment by execution in the Magistrate’s Court. It must be noted that a judgment in the Small Claims Court is not appealable but may be taken on review.

 

Sources:

 

  • Small Claims Court Act 61 of 1984
  • Small Claims Courts: Guidelines for Commissioners

 

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)

1 … 15 16 17 18 19 … 28
[tm-current-year] © RustGold Transport | Tel. +27 (0)14 537 2358 |