Accounting Records for an Authorised Company

Owners of an Authorised Company often ask the same thing in the first month: do we need full accounts, or only a short filing? The honest answer has several layers. Authorised company financial statements in the narrow sense, the document filed with the regulator, are modest. The underlying authorised company accounting records are another matter, because banks, counterparties and the tax authority will all expect a coherent paper trail.

This guide separates the two, explains who physically holds the records, and shows the moments when they stop being background paperwork and become the centre of a conversation. It gives general information only; the right level of record-keeping depends on your activity, your home country and your bank.

Records, statements and summaries: three different things

The vocabulary is a frequent source of confusion, so it helps to fix it early.

• Accounting records are the raw material: contracts, invoices, receipts, bank statements, payment-platform reports, ledgers and the journal entries built from them. They explain what the company did and why.
• Financial statements are the formal output built from those records: typically an income statement, a balance sheet and explanatory notes for a given financial year.
• The financial summary is the specific filing an Authorised Company makes with the Financial Services Commission (FSC). It follows the model set out in the Ninth Schedule of the Companies Act, or other documents specified by the FSC Rules.

An Authorised Company is incorporated under the Companies Act, so the general duty of any company to keep records that explain its transactions and show its position applies in the background. What is distinctive is the regulatory filing on top of it, and the way the work is divided between the company and its service provider.

What the FSC actually asks for

Under section 71A(10) of the Financial Services Act, an Authorised Company must file a financial summary with the FSC every year, no later than six months after the end of its financial year. The filing follows the Ninth Schedule model of the Companies Act, unless the FSC Rules specify other documents.

Two practical points follow from this.

1. The deadline runs from your year-end, not from the incorporation date. The date you choose for closing the financial year therefore sets the rhythm of the whole calendar.
2. A summary is only as good as the records behind it. The figures you file must reconcile with a ledger, and the ledger with bank statements and invoices. A thin filing resting on thin records is the weak point that surfaces later.

For readers comparing regimes: a Global Business Corporation is held to a heavier standard. Under section 71(3)(b) of the Financial Services Act it must keep its accounting records at its registered office in Mauritius and have its statutory financial statements prepared and audited in Mauritius. That obligation is written for the GBC regime and not for the Authorised Company regime described here; the question of audits is outside the scope of this page.

Who holds the records

An Authorised Company must have a registered agent in Mauritius at all times, and that agent must be a FSC-licensed corporate service provider (Management Licence). Under section 71A(8) of the Financial Services Act, the registered agent's responsibilities include:

• filing the returns and documents required under the Financial Services Act, the Income Tax Act or the Companies Act;
• passing on communications between the company and the FSC, the Mauritius Revenue Authority (MRA) and the Registrar of Companies;
• applying anti-money laundering and countering the financing of terrorism (AML/CFT) measures;
• keeping the company's records, such as minutes, resolutions and transaction documents.

That last item is where owners are sometimes misled. The registered agent keeps the corporate records and the supporting documents it handles. It does not, by default, run your day-to-day bookkeeping. Who records each invoice, categorises each payment and reconciles each bank statement is a matter for your engagement terms. Read them closely before assuming anything, and use the questions to ask a corporate service provider to pin down what is and is not included.

For the role of the provider itself, see the provider behind your Authorised Company.

Two sets of books is a bad idea

A common pattern is for the owner to keep an informal spreadsheet while the provider holds a different version for filings. The two inevitably drift apart. Decide which set is the master, share it regularly, and make sure the version used for the financial summary, the bank and the tax return is the same one.

The tax return still exists

Being an Authorised Company does not remove the need to file with the Mauritian tax authority. Section 73A of the Income Tax Act treats a company incorporated in Mauritius as non-resident if it is centrally managed and controlled outside Mauritius, but it states that the company must still file an income tax return under section 116.

Section 116 requires every company, taxable or not, to file its return with the Director-General no later than six months after the end of the month in which its financial year closes. Filing and payment are made electronically. For a year ending in June, the deadline falls two working days before the end of December; for a year ending in December, two working days before the end of June.

The return rests on the same records. A company that has kept clean books can complete it quickly; a company that has not will find that gaps are expensive to repair after the fact. The wider context is covered in the annual obligations of an Authorised Company and the tax treatment of an Authorised Company.

Why the return matters beyond compliance

A company that wants a Tax Residence Certificate can apply to the Director-General of the MRA. Under section 73 of the Income Tax Act, the certificate is to be issued within seven days of the application, provided the required return (section 112 or 116) has been filed and the service fee paid. Whether a given certificate is available or useful to an Authorised Company depends on its circumstances, so take advice before relying on it.

Where records matter most

The pattern is the same across the table: the records are rarely requested when everything is quiet. They are requested when something changes, and by then the quality of the past twelve months decides how smooth the next step is.

Banks: where records are tested first

For most small companies, the bank is the first reader of the books. Account opening, periodic reviews and requests to raise limits all lead to the same questions: what does the company sell, to whom, and does the money flowing through the account match that story?

Good records answer these questions without effort. Poor ones invite more questions, and unanswered questions are a common reason accounts are restricted or closed. The reasons behind refusals are explored in why banks refuse offshore company accounts, and the options are compared in banking for an offshore company.

Tax authorities at home

An Authorised Company can be one input into the owner's own tax position. Whether profits are taxed in the company's hands, the owner's, or both depends on the owner's country of residence and on where the company is managed. This site does not give advice on that point; an adviser who knows your home rules must do that analysis.

What can be said in general is that records are the evidence. If a foreign tax authority asks where board decisions were taken, who did the work, and how profits arose, the answer has to be demonstrable from documents: minutes, contracts, correspondence and invoices. For related themes, see managing an Authorised Company from abroad.

A practical routine

Records that are kept as the year goes on take little time. Records rebuilt in a rush take a great deal. A sensible routine for a small company:

• Choose the financial year-end and record it in the company's file
• Open a dedicated bank or payment account and never mix personal spending with it
• Save every invoice, contract and receipt in a single, dated folder structure
• Reconcile the bank statement to the ledger every month
• Keep written minutes or resolutions for significant decisions
• Store a copy of everything outside the provider's systems as well
• Agree with the provider, in writing, who prepares which document and by when

Tooling choices and a more detailed monthly routine are discussed in bookkeeping for an offshore company, and the yearly sequence is listed in the yearly checklist for an Authorised Company.

What the records should say about your business

An accounting file is also a narrative. If the company invoices clients, the invoices, contracts and payments should tell the same story. The practical side of billing is covered in invoicing clients from an offshore company.

An Authorised Company is also restricted in the kind of business it may carry on. Section 71A(4) of the Financial Services Act lists five categories of activity that, save for exceptions in the FSC Rules, it cannot carry out: banking; professional management or administration of a collective investment fund or scheme; financial services; corporate services such as head-office, nominee, director or secretarial services for companies; and professional trusteeship. Records showing income from any of those would raise questions with the FSC and with banks alike.