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What is a Public Interest Score?
The Public Interest Score (PIS) is a points system introduced by Regulation 26 of the Companies Act 71 of 2008. It measures how much public interest there is in a company's affairs, and it is the single number that determines whether a South African company must be audited, independently reviewed, or neither. Every company and close corporation must calculate its score every financial year.
How the score is calculated
You get one point per employee (averaged over the year), one point per R1 million or part thereof of turnover, one point per R1 million or part thereof owed to third parties at year end, and one point per individual who holds a beneficial interest in the company's shares.
Audit, independent review, or exempt
Score 350 or more and a company audit is compulsory. Between 100 and 349, you need an audit if your financials are compiled internally, or an independent review if an independent accountant compiles them. Under 100 points you need an independent review, unless every shareholder is also a director, in which case you are exempt from both. Companies holding more than R5 million in fiduciary assets must be audited regardless of score, and your MOI can also impose an audit voluntarily.
CFO360 Registered Auditors provides the full range of audit and assurance services, and our accounting team handles annual financial statements, company tax and monthly accounting for companies of every size.
Frequently asked questions
What is a Public Interest Score?
The Public Interest Score (PIS) is a points system in Regulation 26 of the South African Companies Act, 2008. It measures how much public interest there is in a company's affairs and determines whether the company must be audited, independently reviewed, or neither.
How is the Public Interest Score calculated?
You get one point per employee (averaged over the financial year), one point per R1 million or part thereof of annual turnover, one point per R1 million or part thereof owed to third parties at year end, and one point per individual with a beneficial interest in the company's shares.
What Public Interest Score requires an audit in South Africa?
A score of 350 or more always requires an audit. A score of 100 to 349 requires an audit if the annual financial statements are compiled internally, or an independent review if they are compiled by an independent accountant. Companies holding more than R5 million in fiduciary assets must be audited regardless of score.
What is the difference between an audit and an independent review?
An audit gives a full, positive assurance opinion on the financial statements and involves detailed testing. An independent review is a lighter engagement giving limited assurance, based mainly on enquiry and analytical procedures, and typically costs substantially less than an audit.
Which companies are exempt from both audit and independent review?
A company with a Public Interest Score under 100 is exempt from both if every person who holds a beneficial interest in its shares is also a director, known as an owner-managed company. The exemption does not remove the duty to prepare annual financial statements.
Do exempt companies still need annual financial statements?
Yes. Every company must prepare annual financial statements within six months of its financial year end, and SARS requires them to support the annual income tax return. Exemption only removes the audit or review requirement, not the financial statements themselves.