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CIPC: Publication of Business Rescue Plan
- 06 December 2024
- CIPC
- South African Accounting Academy
Summary:
The Companies and Intellectual Property Commission (CIPC) has observed that based on case law that business rescue practitioners (BRPs) are failing to publish the business rescue plans or are delaying this crucial rescue stage as required by the Act.
Article:
The CIPC hereby notifies BRPs of their obligation in terms of section 150(5) of the Act which stipulates as follows:
“Section 150 (5) The business rescue plan must be published by the company within 25 business days after the date on which the practitioner was appointed, or such longer time as may be allowed by-
- the court, on application by the company; or
- the holders of a majority of the creditors’ voting interests.”
The CIPC further request any interested and/or affected party to notify the Commission of such failure in order to commence with compliance notice process.
The Notification by interested/affected parties to the business rescue proceedings must forward their correspondence via email to [email protected] or alternatively, [email protected] when the business rescue practitioners (BRPs) have failed to comply with Section 150 (5) as stated above.
Click here to download Practice Note 3 of 2024:
https://www.cipc.co.za/wp-content/uploads/2024/12/Practice-Notice-Publication-of-the-BR-Plan.pdf
Relevance to Auditors, Independent Reviewers & Accountants:
- The Companies Act is yet another piece of legislation that your clients must comply with, and which you must assess compliance with. If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
- As an auditor, independent reviewer and accountant, you also need to monitor your client’s compliance with the Companies Act and all relevant notices/enforcements/practice notes issued by CIPC as the regulator.
- Where you perform these compliance tasks on behalf of your client, you need to ensure that you comply with all relevant notices/enforcements/practice notes and that you are aware of the latest media statements issued by CIPC as the regulator.
- Business Rescue Practitioners must publish a Business Rescue Plan – as required.
Relevance to Your Clients:
- An entity (company or close corporation) has a duty to comply with the Companies Act, and all relevant notices/enforcements/practice notes and to be aware of the latest media statements issued by CIPC as the regulator.