Seychelles Enforces Compliance with International Financial Standards
The Seychelles Financial Services Authority (FSA) has issued a stern warning to all International Business Companies, Foundations, Limited Partnerships, and Trusts operating in the country to ensure compliance with new accounting record-keeping obligations.
New Accounting Record-Keeping Obligations
As of August 6, 2021, legal entities in Seychelles must maintain reliable accounting records that accurately reflect their financial transactions and positions. The records must be kept for at least seven years from the date of completion of each transaction or operation.
Key Requirements
- IBCs must maintain underlying accounting records at their registered office in Seychelles, including historical records dating back to January 1, 2015.
- Records must be sent to the Seychelles registered office by February 6, 2022.
- Accounting records can take many forms and include documents such as:
- Bank statements
- Receipts
- Invoices
- Vouchers
- Title documents
- Contracts
- Agreements
Bi-Annual Reports and Annual Financial Summaries
Starting in 2022, legal persons and arrangements will also need to submit bi-annual reports of their accounting records to the registered office. Large companies with an annual turnover above approximately USD3.75 million must also prepare an annual financial summary, which must be kept at their registered office in Seychelles within six months of the end of their financial year.
Consequences of Non-Compliance
The FSA has warned that non-compliance will result in heavy fines and penalties ranging between USD2,000 to USD10,000 per breach. As a result, legal persons and arrangements are advised to take immediate action to collate their required accounting records from January 1, 2015, onwards.
On-Site Compliance Inspections
The Registrar of Companies is expected to initiate on-site compliance inspections as of February 2022 to ensure that reliable accounting records are being kept by legal persons and arrangements in Seychelles. Those found non-compliant will face relevant sanctions.
Take Action
In light of this new requirement, we recommend that you reach out to your usual Zetland contact if you have any questions or concerns regarding compliance with the new regulations.