If the government did not require you to prepare and file accounts and annual reports, would you still do so voluntarily and what would be the quality of your company's accounts? Today, many tax haven jurisdictions have no requirements for filing annual or monthly tax returns and reports: offshore companies have an autonomous freedom of choice to retain the documents as they wish. However, more and more offshore jurisdictions have started to modernize and update their legislation, gradually introducing a mandatory requirement to retain financial records and documents, as the beneficial owner of such a company would be the one who would benefit the most . This aspect can play a crucial role, especially when an offshore company is owned and managed by multiple people, providing a more efficient system to monitor assets and monitor decisions made.

For example, in the Seychelles, companies are required to keep bills of exchange without providing accounting records to government authorities, which subsequently allow monitoring of the company's economic status to provide up-to-date information to owners at all times. However, there is no obligation to make financial documents public, nor are there any statutory audit requirements. In theory, the local tax authority may require the company to provide and/or improve its records. However, such a situation can only arise in circumstances provided for by legal acts and can usually be foreseen and avoided.

As we just mentioned, tax havens (BVI, Panama, Seychelles, Nevis, Marshall Islands, Dominica, etc.) do not have to file financial statements with the local authorities. However, today many offshore companies choose to voluntarily prepare financial statements for IBCs and tax haven companies. The reasons for such actions are as follows.

The legal requirements of many offshore companies require proper accounting by the company. Income statements, general ledger and balance sheet of the company must always be available upon request of the registered agent. All accounting documents confirming transactions must also be kept by the company: invoices, contracts, transport documents, bank statements, etc. Such provisions exist in (BVI, Seychelles, Nevis, Belize and many other offshore jurisdictions. Please note that financial records from International Business companies may be stored anywhere in the world, not necessarily at the registered office.

Your bank may ask you for the annual accounts of your offshore company. As banks are tightening their requirements on tax havens, one of the ways to keep your commercial bank account for such a company is to provide accounting statements upon request. Banks often require the simplest accounting reports: income statement and balance sheet.

Your own control over financial operations is the most obvious reason to keep account records for any business.