Mastering Financial Statement Compilation: 2026 Regulatory Guide

Posted 02 June 2026 Written by Acts Online
Category Accounting & Financial Reporting

Brought to you by SA Accounting Academy: In terms of the Companies Act, No. 71 of 2008 and the Companies Regulations, 2011, South African accounting practitioners must navigate shifting compliance mandates in 2026, including updated Public Interest (PI) Score thresholds, beneficial ownership reporting, and upcoming international reporting standards.

Under Regulation 26 of the Companies Regulations, 2011, the calculation of a company’s Public Interest Score (PI Score) remains the baseline requirement before any financial statement drafting begins. The PI Score determines whether an entity requires a full audit, an independent review, or a compilation. Regulations 28 and 29 dictate these assurance requirements, while Section 30(2A) of the Companies Act, No. 71 of 2008 provides exemptions from independent review for certain owner-managed companies.

Different legal frameworks govern financial statement compilation across various entity types:

  • Companies and Close Corporations: Regulated by the Companies Act, No. 71 of 2008 and the Close Corporations Act, No. 69 of 1984.
  • Bodies Corporate: Must present audited annual financial statements within four months of financial year-end under the Sectional Titles Schemes Management Act, No. 8 of 2011.
  • Trusts: Financial reporting requirements are dictated by the individual trust deed and the Trust Property Control Act, No. 57 of 1988.

Key Regulatory Updates for 2026

Practitioners must align their compilation workflows with several recent legislative changes:

  • Companies Amendment Acts: The Companies Amendment Act, No. 16 of 2024 and the Companies Amendment Act, No. 17 of 2024 introduce mandatory named disclosure of remuneration for directors and prescribed officers in audited companies, alongside expanded rights for non-shareholders to inspect financial statements.
  • Beneficial Ownership: Following South Africa’s exit from the Financial Action Task Force (FATF) grey list on 24 October 2025 and its removal from the European Commission’s high-risk list on 7 January 2026, anti-money laundering (AML) and beneficial ownership obligations remain strictly in force. The Companies and Intellectual Property Commission (CIPC) enforces a hard-stop system, blocking the filing of annual returns until the beneficial ownership declaration is completed.
  • IFRS for SMEs: The third edition of the International Financial Reporting Standard for Small and Medium-sized Entities (IFRS for SMEs), issued in February 2025, becomes effective for reporting periods beginning on or after 1 January 2027.
  • SA GAAP: Practitioners are reminded that South African Statements of Generally Accepted Accounting Practice (SA GAAP) have been officially withdrawn since 1 December 2012 and may not be used.

Before accepting a compilation engagement, practitioners must satisfy the preconditions of the International Standard on Related Services, ISRS 4410 (Revised). Additionally, the International Ethics Standards Board for Accountants (IESBA) Code dictates strict compliance with Non-Compliance with Laws and Regulations (NOCLAR) and predecessor-accountant communication protocols.

To access comprehensive decision tables, framework-selection guidelines under Regulation 27, and entity-specific legislative references, practitioners can download the full guide on the SA Accounting Academy portal.

What this means for you, your business, or your clients

  • For yourself: You must correctly calculate client PI Scores under Regulation 26 and verify compliance with ISRS 4410 (Revised) and IESBA NOCLAR rules before signing off on any compilation engagement.
  • For your business: Your practice must update its internal client onboarding and annual return workflows to ensure beneficial ownership declarations are filed with the CIPC prior to attempting annual return submissions, preventing administrative blocks.
  • For your clients: Client entities must prepare for the disclosure of named director and prescribed officer remuneration if subject to audit under the Companies Amendment Acts of 2024, and begin transitioning systems to meet the third edition IFRS for SMEs requirements ahead of the 1 January 2027 effective date.

Originally published at https://accountingacademy.co.za/news/read/mastering-financial-statement-compilation-what-every-sa-practitioner-needs-to-know-in-2026

The views expressed herein are those of the author and do not necessarily reflect those of Acts Online. Acts Online accepts no responsibility for the accuracy, completeness or fairness of the article, nor does the information contained herein constitute advice, legal or otherwise.