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In South Africa, the Public Interest Score (PIS) is a simple but important measure used to decide what level of financial reporting and assurance a company is required to have. In short, the higher your PIS score, the more formal and independent your financial reporting must be.

What is the PIS Score?

The PIS score reflects how much public interest there is in your company. Companies that affect more people (employees, funders, customers, shareholders) are subject to higher reporting standards.

The score is calculated annually and determines whether your annual financial statements (AFS) need:

* No external work
* A Compilation
* An Independent Review
* A full Audit

How is the PIS Score Calculated?

Your PIS score is made up of the following:

1. Employees

  * 1 point for each average employee during the year

2. Turnover

  * 1 point for every R1 million (or part thereof) in annual turnover

3. Third-party liabilities

  * 1 point for every R1 million (or part thereof) owed to third parties at year-end

4. Shareholders

  * 1 point for each individual who has a beneficial interest in the company’s shares

Add these together and you get your PIS score.

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Owner-Managed vs Non-Owner-Managed Companies

This distinction is critical.

Owner-Managed Company

A company is owner-managed only if ALL shareholders are also directors of the company.
If even one shareholder is not a director, the company is not owner-managed.

Non-Owner-Managed Company

A company where:

* There are shareholders who are not directors, or
* There are external investors who do not participate in management

Non-owner-managed companies usually require higher levels of independent oversight.

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What Does Your PIS Score Mean in Practice?

Using the table above as reference, the requirements can be summarised as follows:

Summary

* For PIS below 100 and the company is owner-managed does not require an audit or an independent review. If not owner-managed then an independent review is required.

* PIS between 100 and 350 where the company's AFS are internally compiled requires an audit.  

* For PIS between 100 and 350 where the company's AFS are independently compiled, and the company is owner-managed, no review or audit is required. If not owner-managed then an independent review is required.

* PIS score above 350 requires an audit in all circumstances.

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Typical SME example

Companies with a PI Score of less than 100 which are owner-managed only require Compilation AFS.

These are usually small companies, with a couple of directors who are involved in the running of the business and they own all the shares in the company.

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PIS Score do not apply to:

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* Public companies (listed or unlisted),

* State owned entities,

* companies with fiduciary assets (i.e you hold assets/funds/cash on behalf of other e.g Attorneys and Rental Agents) exceeding R5 million and

* companies with a Memorandum of incorporation (MOI) that requires them to be audited.  

All of these companies are subject to an audit by registered independent auditors anyway.

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For the rest of the private companies, your level of assurance and financial standard to be used depends on whether the company is owner managed or not and whether the AFS have been internally compiled or independently compiled (by an external accountant).

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Why This Matters?

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Getting your PIS score wrong can lead to:

* Non-compliance with the Companies Act
* Rejected financial statements
* Unnecessary audit costs
* Issues with banks, investors, or regulators

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At Thornberry, we help clients:

* Correctly calculate their PIS score
* Determine whether they are owner-managed
* Apply the correct level of reporting and assurance—no more, no less

Need Help?

If you’re unsure about your PIS score or what your company is required to do, we can assess it quickly and clearly—without overcomplicating things.

📩 hello@thornberry.co.za
🌍 thornberry.co.za

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