CIPC: Reminder to customers: CIPC is changing of payment method

CIPC: Reminder to customers: CIPC is changing of payment method

• 28 July 2023
• Accounting
• South African Accounting Academy

This is done in an effort to continuously improve their customer service offering.

Although the Enhanced E-Service of January 2023 was rolled back which only made use of the card payment option, CIPC is going ahead in the implementation of its strategic decision to phase out declining balances. Therefore, as CIPC enhances its existing electronic services and automates more of its manual processes it will solely make use of card payments and other real-time online payment options as and when it is implemented by CIPC.

The rationale for the strategic phasing out the current declining balance payment method is:-

• It is an effort to improve the CIPC's turnaround times and customer experience;

• To eliminate delays in the allocation of funds due to incorrect referencing;

• To eliminate bulk deposits that are typically not used for a specific period of time;

• To avoid the possible risk of contravening the Banks Act 1990, as the CIPC cannot continue to retain the money in its account indefinitely;

• To mitigate the reputational risk of CIPC being accused as a vehicle to facilitate illegal activities; and

• Under the declining balance payment method, CIPC has inherently become responsible for the administration of monies within the customer codes. Each customer is responsible for the management of his/her own payments. Considering the volume of transactions and customers the CIPC services, it is therefore not cost effective for the CIPC or efficient to customers.

The CIPC understands that this strategic decision may inconvenience customers as they adapt and transition to the new payment methods and apologises for the inconvenience that such is going to cause.

Click here to download the Notice:

https://www.cipc.co.za/wp-content/uploads/2023/07/balance-notice.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/customer letters 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/customer letters issued by CIPC as the regulator.

• Company Secretarial staff play a critical role in bridging the gap between entities and CIPC. As legislation, regulations and tax law are continuously changing and evolving, it is of utmost importance for companies and company secretarial practitioners to keep abreast of such changes in so that companies continue to meet their compliance obligations.

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/customer letters issued by CIPC as the regulator.

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