Companies Act (Cap. 386), article 163

163. (1) In lieu of the requirements of articles 13 to 18 of the Commercial Code a company shall be required to keep proper accounting records wi th respect to - (a) all sums of money received and expended by the company and the matters in respect of which the receipt and expend iture takes place; (b) the assets and liabilities of the company; (c) if the company’s business involves dealing in goods: (i) statements of stocks held by the company at the end of each accounting pe riod of the company; (ii) all statements of stocktakings from which any such statement of stocks as is mentioned in sub- paragraph (i) has been or is to be prepared; and (iii) except in the case of goods sold by way of ordinary retail trade, statements of all goods sold and purchased, showing the goods and the buyers and sellers in sufficient detail to enable all these to be identified. (2) For the purposes of sub-a rticle (1), proper accounting records shall be deemed to have been kept with respect to the matters aforesaid if such records are sufficient to show and ex plain the company’s transactions and are such as to - (a) disclose with reasonable accuracy, at any time, the financial position of the company at that time; and (b) enable the directors to e nsure that any balance sheet and profit and loss account prepared under this Chapter complies with the requirements of this Act. (3) The accounting records shall be kept at the registered offic e of the company or at such other place as the directors think fi t, and shall be at all times open to inspection by the officers of the company: Provided that if accounting records are kept at a place outside Malta there shall be sen t to, and kept at a place in Ma lta and at all times be open to the insp ection of the officers of the c ompany such accounts and retu rns with respect to the business dealt wi th in the accounting records so kept as will disclose with reasonable accuracy the financial position of that business at intervals n ot exceeding six months and will ena ble to be prepared, in accorda nce COMP ANIES [CAP. 386. 109 with this Act, the company’s balance sheet and its profit and l oss account. (4) A parent company which has a subsidiary undertaking, in relation to which the above requirements do not apply, shall ta ke reasonable steps to secure that the subsidiary undertaking keep s such accounting records as to enab le the directors of the paren t company to ensure that any bal ance sheet and profit and loss account prepared complies with the requirements of this Act. Cap. 13. (5) Notwithstanding the provisions of article 26 of the Commercial Code , the accounting records of the company shall be kept for a period of ten years: Provided that where the account ing records are kept in a bound or unified form, the ten years shall commence to run from the date of the last entry made therein. (6) If a company fails to comply with any provision of sub- articles (1) to (4), every officer of the company who is in def ault shall be guilty of an offence and liable on conviction to a fin e (multa) of not more than eleven thousand and six hundred and forty-six euro (€11,646), unless he shows that he acted d iligently and that, in the circumstances in which the compa ny’s business was carried on, t he default was excusable. (7) If a company fails to comply with the provisions of sub- article (5), every officer of the company who is in default sha ll be liable to a penalty. Accounting reference period and accounting reference date.