What is a Community Interest Company (CIC)?
CICs are limited companies which operate to provide a benefit to the community they serve. Whilst a relatively new limited company structure, created in 2005 for the purpose of social enterprise, they are one of the fastest growing community oriented enterprise movements in the UK. As of Jan 2016 there are over 11,000 CICs on the regulators register, as social enterprise has formed a key part of government economic strategy, and this is set to increase as knowledge of them becomes more widespread.
They are not strictly ‘not for profit’, and as such they can and do deliver returns to investors. However, the purpose of a CIC is primarily one of community benefit rather than private profit. Whilst returns to investors are permitted, these must be balanced and reasonable, to encourage investment in the social enterprise sector and ensure that true community benefit is always at the heart of any CIC.
What defines a CIC?
The main defining features of any company holding CIC status are as follows:
- Asset Lock – all assets owned by the CIC are held in an asset lock which secures them to only be used for the good use of the community.
- Dividend and Interest Payments – limitations are applied on these payments made to shareholders and financiers, so whilst a profit can be made, the main focus is on achieving benefit for the community it serves.
Aside from these two points, CICs range from small homebased businesses to large organisations who employ thousands of people. The diversity of sectors is also growing from community services, health services and social care through to education, property and other professional services.
Our CIC Accounting Services
Accounts, payroll and reporting specific to CICs are important to get right, for example each CIC is required to submit on a yearly basis a report detailing the activities undertaken and how these have benefited the community. This is an important document as it sets out publicly, exactly how the CIC has met its obligations to deliver community benefits. CICs reporting is governed by the Regulator of Community Interest Companies – click here for further information.
Our qualified accountancy team work with Community Interest Companies (CICs) provide the following services:
- CIC set up at Companies House
- Support to complete your CIC34 Report
- Annual accounts and company tax return preparation
- Filing the annual CIC report and accounts
- CIC Payroll services
- CIC accounting services
- CIC Funding and Grant Advice
We keep abreast of all government policy and legislation regarding CICs so you can rest assured your business is in good hands. So whether you are wishing to set up your CIC, convert an existing company to a CIC or want an experienced accountant to manage the accounts for a CIC, we can help.
“We were recommended the services of Firstcall Financials for our Community Interest Company in July 2014.Their appointment coincided with a time of restructure and fundamental overhaul of our systems.Their professionalism,knowledge and fiscal insight combined with vital industry experience has helped transformed our company into an efficient and legally sound business.
On a personal basis they have been of great support and have helped beyond their brief particularly at Board level and I am extremely grateful to them for their continued support.” – Chris Ash-Miles, Bristol Together.
Further information about other sectors we work for can be found here:
Need a hand?
First Call Financials work with a number of South West CICs providing accounting, payroll and CIC specific tax advice. If you would like advice on any aspect of CIC accounting, please call us on 0117 3790810.