Tag: PATC

What Is Financial Distress?

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What Is Financial Distress? Financial distress is a condition in which a company cannot generate revenue or income because it is unable to meet or cannot pay its financial obligations. This is generally due to high fixed costs, illiquid assets, or revenues sensitive to economic downturns. Ignoring the signs of financial distress can be devastating…

Corporate Governance

At PATC, we define corporate governance as the system of rules, practices and processes by which a firm is directed and controlled. Corporate governance essentially involves balancing the interests of a company’s many stakeholders, such as shareholders, management, customers, suppliers, financiers, government and the community. Since corporate governance also provides the framework for attaining a…

Company Records

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PATC defines company records as any documents, accounts, books, writing, records or other information that a company is required to keep in terms of the Companies Act 71 of 2008, or any other public regulations. The Companies Act states in Section 24 that records should be retained in writing or in a form that can…

Duties of Accounting Officer, Auditor & Reviewer

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Understanding How These Roles Differ & Relate Keep reading PATC’s blog and discover the differences and overlap between the duties of your accounting officer, auditor & reviewers. Duties of an Accounting Officer

VAT Registration & Deregistration

three stacks of coins with scrabble tiles stacked on them to spell out VAT

Who Should Register for VAT? Any person that carries on business may register for VAT. You can register once for all different tax types using the client information system. The term person is not only limited to companies but also includes, amongst others, individuals, partnerships, trust funds, foreign donor-funded projects and municipalities. In order to…

Recording Transactions in Compliance with the Accounting Framework

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Revenue Measurement of Revenue Revenue should be measured at the fair value of the consideration received or receivable. An exchange for goods or services of a similar nature and value is not regarded as a transaction that generates revenue. However, exchanges for dissimilar items are regarded as generating revenue.

Leases

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Classification of Leases A lease is classified as a finance lease if it transfers substantially all the risks and rewards incident to ownership. All other leases are classified as operating leases. Classification is made at the inception of the lease.

Donations Tax: Estate Duty

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What is Estate Duty? Estate Duty is payable on the estate of every person who dies and whose nett estate is in excess of R3.5 million. It is charged at the rate of 20%. Estate duty is levied on the property of residents and South African property of nonresidents less allowable deductions. The duty is…

Employees Taxation

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Personal Service Company or Trust This is a company (or trust as the case may be) that is not a labour broker, and whose services to clients are performed on its behalf by a connected person; and such a person would be regarded as an employee of the client if the relationship was directly between…

Liquidation Procedures of All Entities

PATC reveals the financial significance of foreign exchange transactions

Liquidation is the process of bringing a business to an end and distributing its assets to claimants. It is an event that usually occurs when a company is insolvent, meaning it cannot pay its obligations when they come due. As company operations end, the remaining assets are used to pay creditors and shareholders, based on…