Thousands submitting late accounts to MFSA

At least 18% of some 48,000 companies in the Maltese registry which are obliged to file audited accounts, have missed at least one deadline for their filings.

Acknowledging that these companies are in breach of the law, the MFSA said it holds companies to higher regulatory standards than EU counterparts who can exempt companies from filing annual accounts.

The statistic includes several companies no longer operating, “abandoned” by shareholders, or owned by non-resident shareholders who “haven’t kept contact with their Maltese representatives.”

Of those operating normally, smaller companies tend to be the ones filing delay beyond their deadline. “Small companies usually depend heavily on the assistance of their external accountants or auditors for the preparation and submission of annual accounts to the registry,” an MFSA spokesman said.

Companies that do not file audited accounts in time suffer a paltry penalty of €25 annually, with a daily 50c fee for late or non-submission, which actually adds up to around €200 a year. The penalty is enforced irrespective of company size, and engaging an accountant or auditor could cost anything upwards of €1,000. 

But the current penalty, set in 1996, has not been changed since. The daily fine, applicable for each set of annual accounts not filed, can over the years accumulate to a substantial amount. But with the MFSA’s power limited to administering a fine, there’s little – other than increasing fines – it can do to enforce the rules.