In Malta, companies are required to prepare and file audited financial statements annually to comply with legal and regulatory obligations. Here’s a detailed overview of what is involved:

1. Requirement for Audited Financial Statements

Who Needs to File:

• All Companies: Regardless of size, all companies incorporated in Malta must prepare and file audited financial statements.

2. Accounting Standards

• Standards: Financial statements must be prepared in accordance with International Financial Reporting Standards (IFRS) or General Accounting Principles for Smaller Entities (GAPSE) if the company qualifies as a small entity.

3. Components of Financial Statements

• Balance Sheet: Statement of the company's financial position at the end of the financial year.
• Income Statement: Statement of comprehensive income, detailing revenue and expenses.
• Cash Flow Statement: Summary of cash inflows and outflows during the financial year.
• Statement of Changes in Equity: Movements in equity during the year.
• Notes to the Financial Statements: Detailed notes explaining the figures and providing additional information.

4. Audit Requirements

• Independent Auditor: The financial statements must be audited by a certified public accountant or an audit firm licensed in Malta.
• Audit Report: The auditor issues a report expressing an opinion on whether the financial statements give a true and fair view of the company's financial position and performance.

5. Filing Deadlines

• Deadline: The audited financial statements must be filed with the Malta Business Registry within ten months from the end of the financial year.
• Annual Return: The filing is typically done along with the annual return, which is due within 42 days from the anniversary of the company's registration.

6. Filing Procedure

• Electronic Filing: Companies can file their financial statements electronically through the Malta Business Registry’s online portal.
• Paper Filing: Alternatively, paper copies of the financial statements can be submitted to the MBR.

7. Penalties for Non-Compliance

• Late Filing Penalties: Companies that fail to file their audited financial statements on time may incur penalties, which increase the longer the delay.
• Administrative Fines: Persistent non-compliance can result in significant administrative fines.
• Legal Consequences: Continued non-compliance can lead to legal action, including the potential striking off of the company from the register.

8. Exemptions and Special Provisions

• Small Companies: While all companies must file audited financial statements, small companies (meeting specific criteria regarding turnover, balance sheet total, and number of employees) may follow simplified reporting requirements under GAPSE.
• Consolidated Financial Statements: Groups of companies may be required to prepare consolidated financial statements if they control one or more subsidiaries.

9. Keeping Records

• Retention Period: Companies must keep accounting records and supporting documents for at least 10 years from the end of the financial year to which they relate.

Conclusion

Preparing and filing audited financial statements is a critical compliance requirement for companies in Malta. Ensuring timely and accurate filing helps avoid penalties and legal issues. Given the complexity, many companies engage professional accountants and auditors to assist in the preparation, auditing, and filing of their financial statements.

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