Companies targeted over late accounts

THE Companies Registration Office (CRO) has launched a crackdown on companies that repeatedly fail to file their annual accounts on time.

The CRO has developed a software programme to identify firms that have not filed their accounts by the date they should and monitor persistent offenders.

The launch of the Integrated Enforcement Environment programme has already thrown up 5,000 companies that could be struck off the Register of Companies and lose their limited liability status. This would mean that the firms' directors could be personally liable to their creditors if they go out of business.

CRO registrar Paul Farrell said yesterday: "We have already identified a small number of firms that have annual returns still not filed for 2002. That's over two years late. Our decision was that this was completely unacceptable and that the strike-off procedure was the most appropriate route. They will have already received letters notifying of them of this."

He said filing returns on time was necessary to allow customers and suppliers to know about the firms' financial health.

"Up to now we have been encouraging companies to comply through public information campaigns. We've tended to apply the fines that are available to us but have not been vigorous in using harsher penalties. And this has worked well," he said.

It is only possible to begin stricter enforcement now since compliance levels have recently increased.

"We now have average compliance up to 84%. This compares well with the 15% level at the start of the 1990s," he said.

Companies will not only risk fines and being struck off for not filing in time, but could also face legal action.

Last year saw a three fold increase in the number of firms struck off the register. Of the 20,319 in 2003, just under 15,000 were struck off involuntarily. Mr Farrell said this was an exceptional figure which he did not see being repeated in 2004.

The CRO also saw a large increase in the amount of fines and penalties it received from companies in 2003. It jumped by €16 million to €28 million. Four years ago, the CRO took in just €1.8m in fines.

So far this year, the CRO has taken in €6m in fines, down from €8.5m at this stage last year.