Obligations that recur after a company is recorded
The obligations that recur after an Iraqi company exists are read from Companies Law No. 21 of 1997 as amended. The framework is on registering a company. What follows immediately after the certificate of incorporation is issued is on a separate page. The obligations of a foreign-company branch are read from the branches regulation. The Law Office of Ali Barakat follows the question from Baghdad, al-Yarmouk.
Final accounts and the audit
In a joint-stock company, the board of directors is to prepare the final accounts for the previous year during the first six months of each year, to draw up a comprehensive report on them and on the results of carrying out the annual plan, and to submit them to the general assembly for discussion and approval. The accounts are to include the general balance sheet, the profit-and-loss statement, and any other data decided by the bodies the text names, under article 117, third paragraph. In other companies, the managing director has the same powers of the board in this respect, within the limits to which article 123 refers. The final accounts are signed by the chairman of the board and the managing director in a joint-stock company, and by the managing director in other companies, and each signatory is responsible for the correctness of the data they contain, under article 138.
The accounts of a mixed company are subject to the control and audit of the Board of Supreme Audit. The accounts of a private company are subject to control and audit by auditors whom the company's general assembly appoints, under article 133. The accounts of companies connected with one another are to be consolidated in accordance with international accounting standards, unless those standards have been specifically modified by standards in force in Iraq. The auditor is to submit a report to the company on the accounts within thirty days of the date on which their preparation is completed. The auditor is to state an opinion on the final accounts of a joint-stock company before its general assembly; that may also be done in other companies. The opinion is to address the matters article 136 lists, including the soundness of the accounts and the correctness of the data. The auditor is answerable for the correctness of the data in the report, as the company's agent in supervising and auditing its accounts, under article 137. A holding company is, at the end of each financial year, to prepare a consolidated balance sheet and profit-and-loss statements for itself and all of its subsidiaries, together with the prescribed notes, under article 7 bis, fourth paragraph.
The board's report on the final accounts in a joint-stock company, and the managing director's report in other companies, is to contain detailed data on the company's activity, including the significant contracts it made in the previous year, under article 134.
The general-assembly meeting and sending copies to the Registrar
The general assembly of a joint-stock company meets at least once in each year, and the general assemblies of other companies meet at least once every six months, under article 86. The general assembly is to meet to discuss and approve the final accounts within sixty days of the date on which their audit is completed, under article 135. The general assembly is the highest body in the company. It has, in particular, the discussion of the reports of the board or of the managing director and of the auditor, the discussion and approval of the final accounts, and the appointment of the auditor and the fixing of the auditor's fees in private companies, under article 102. Decisions of the general assembly are sent to the Registrar within seven days of the date on which they are taken, and the copy authenticated by the Registrar is a document that may be presented to any body, under article 99. Copies of the final accounts, the annual plan, the reports prepared on them, and the general-assembly decisions relating to all of that, are also sent to the Registrar, under article 139. The detail of the quorum and of the minutes is on the general-assembly page when it is published.
Holders of five per cent of the company's shares may object to decisions of the general assembly before the Registrar within seven days of the date on which they are taken. The Registrar is to issue a decision within fifteen days of the date of the objection. That decision may be challenged before the Court of First Instance within seven days of notification. The court is to hear the objection as a matter of urgency, and its decision is final, under article 100. The name Court of First Instance is used as it appears in the text.
What is distinct from the duties that follow the certificate at once?
The founders' meeting within thirty days of the issue of the certificate, recording the company in the commercial register at a chamber of commerce within thirty days of its formation, and opening a tax file with the General Commission for Taxes if required, are paths reviewed at the start of activity. They are not the yearly final accounts. Sending the accounts to the Registrar does not stand in for a social-security file if there are workers; that path is before the Department of Pension and Social Security for Workers. If the entity is a branch of a foreign company, its yearly obligations are read from the branches regulation, not from the accounting articles above.
The office follows a reading from Baghdad, al-Yarmouk.
Legal basis and sources
Frequently asked questions
How do yearly filings differ from the duties that follow the certificate of incorporation?
What follows the certificate at once is a separate page. This page is for what recurs after the company exists: accounts, an audit, a general assembly and copies sent to the Registrar.
When is the meeting to approve the final accounts held?
Within sixty days of the date on which their audit is completed, under article 135, together with the meeting timetable in article 86.
Are the accounts of a mixed company audited in the same way as those of a private company?
No. The accounts of a mixed company are subject to the control and audit of the Board of Supreme Audit. Those of a private company are subject to auditors whom the general assembly appoints, under article 133.
Related topics and articles
- 01What is required of the company after the certificate of incorporation is issued?What follows the certificate of incorporation: the founders meeting, the commercial register and a tax file, distinct from recurring yearly filings.
- 02General assembly meetings, quorum and minutesA general assembly meeting: the invitation, quorum, minutes and decisions under the Companies Law, and sending those decisions to the Registrar.
- 03When is a branch chosen, and when is an Iraqi limited company chosen?Opening a foreign-company branch or forming an Iraqi limited company at the Registrar, under the 2017 regulation and Companies Law 21/1997, as amended.
- 04The address of a company or branch, a lease and a title deedThe company's address in its contract, before the Registrar and in the commercial register; a lease or deed may evidence it. Not a real-estate page.
- 05Registering a company in Basra: which department is approached, and what differs from Baghdad?Registering a company when dealing in Basra under the federal Companies Law, followed from Baghdad.