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|
Companies Act 1989 |
1989 c. 40 - continued |
| | back to
previous page | | Companies
Act Index |
Supplementary provisions |
Accounting
standards.
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19. The
following section is inserted in Part VII of the Companies Act 1985, as the beginning
of a Chapter III | |
"Part III | | |
Supplementary Provisions | | |
Accounting standards |
Accounting standards.
|
256. (1) In
this Part "accounting standards" means statements of standard accounting
practice issued by such body or bodies as may be prescribed by regulations.
(2) References in this Part to accounting standards
applicable to a company's annual accounts are to such standards as are, in accordance
with their terms, relevant to the company's circumstances and to the accounts.
(3) The Secretary of State may make grants to or
for the purposes of bodies concerned with (a) issuing accounting
standards, (b) overseeing and directing the issuing of such
standards, or (c) investigating departures from such standards
or from the accounting requirements of this Act and taking steps to secure compliance
with them. (4) Regulations under this section
may contain such transitional and other supplementary and incidental provisions
as appear to the Secretary of State to be appropriate.
" |
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Power
to alter accounting requirements.
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20. The
following section is inserted in Part VII of the [1985 c. 6.] Companies
Act 1985 | |
Power to alter accounting requirements |
Power of Secretary of State to alter accounting
requirements.
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257. (1) The
Secretary of State may by regulations made by statutory instrument modify the
provisions of this Part. (2) Regulations which
(a) add to the classes of documents required to be prepared, laid
before the company in general meeting or delivered to the registrar,
(b) restrict the classes of company which have the benefit of any exemption,
exception or special provision, (c) require additional matter
to be included in a document of any class, or (d) otherwise
render the requirements of this Part more onerous, shall not be made unless
a draft of the instrument containing the regulations has been laid before Parliament
and approved by a resolution of each House. (3) Otherwise,
a statutory instrument containing regulations under this section shall be subject
to annulment in pursuance of a resolution of either House of Parliament. (4) Regulations
under this section may (a) make different provision for different
cases or classes of case, (b) repeal and re-enact provisions
with modifications of form or arrangement, whether or not they are modified in
substance, (c) make consequential amendments or repeals in
other provisions of this Act, or in other enactments, and (d) contain
such transitional and other incidental and supplementary provisions as the Secretary
of State thinks fit. (5) Any modification
by regulations under this section of section 258 or Schedule 10A (parent and subsidiary
undertakings) does not apply for the purposes of enactments outside the Companies
Acts unless the regulations so provide.
" | . |
Parent and
subsidiary undertakings.
|
21.(1) The
following section is inserted in Part VII of the [1985 c. 6.] Companies
Act 1985 | |
Parent and subsidiary undertakings |
Parent and subsidiary undertakings.
|
258. (1) The
expressions "parent undertaking" and "subsidiary undertaking"
in this Part shall be construed as follows; and a "parent company" means
a parent undertaking which is a company. (2) An
undertaking is a parent undertaking in relation to another undertaking, a subsidiary
undertaking, if (a) it holds a majority of the voting rights in
the undertaking, or (b) it is a member of the undertaking
and has the right to appoint or remove a majority of its board of directors, or
(c) it has the right to exercise a dominant influence over
the undertaking (i) by virtue of provisions contained in the undertaking's
memorandum or articles, or (ii) by virtue of a control contract, or
(d) it is a member of the undertaking and controls alone,
pursuant to an agreement with other shareholders or members, a majority of the
voting rights in the undertaking. (3) For
the purposes of subsection (2) an undertaking shall be treated as a member of
another undertaking (a) if any of its subsidiary undertakings
is a member of that undertaking, or (b) if any shares in
that other undertaking are held by a person acting on behalf of the undertaking
or any of its subsidiary undertakings. (4) An
undertaking is also a parent undertaking in relation to another undertaking, a
subsidiary undertaking, if it has a participating interest in the undertaking
and (a) it actually exercises a dominant influence over it, or
(b) it and the subsidiary undertaking are managed on a unified
basis. (5) A parent undertaking shall be
treated as the parent undertaking of undertakings in relation to which any of
its subsidiary undertakings are, or are to be treated as, parent undertakings;
and references to its subsidiary undertakings shall be construed accordingly.
(6) Schedule 10A contains provisions explaining expressions
used in this section and otherwise supplementing this section.
" |
. (2) Schedule 9 to this Act
(parent and subsidiary undertakings: supplementary provisions) is inserted after
Schedule 10 to the [1985 c. 6.] Companies Act 1985, as Schedule 10A. |
Other interpretation
provisions.
|
22. The
following sections are inserted in Part VII of the [1985 c. 6.] Companies
Act 1985 | |
Other interpretation provisions |
Meaning of "undertaking" and related
expressions.
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259. (1) In
this Part "undertaking" means (a) a body corporate or
partnership, or (b) an unincorporated association carrying
on a trade or business, with or without a view to profit. (2) In
this Part references to shares (a) in relation to an undertaking
with a share capital, are to allotted shares; (b) in relation
to an undertaking with capital but no share capital, are to rights to share in
the capital of the undertaking; and (c) in relation to an
undertaking without capital, are to interests (i) conferring any right
to share in the profits or liability to contribute to the losses of the undertaking,
or (ii) giving rise to an obligation to contribute to the debts or expenses
of the undertaking in the event of a winding up. (3) Other
expressions appropriate to companies shall be construed, in relation to an undertaking
which is not a company, as references to the corresponding persons, officers,
documents or organs, as the case may be, appropriate to undertakings of that description.
This is subject to provision in any specific context providing for the translation
of such expressions. (4) References in this
Part to "fellow subsidiary undertakings" are to undertakings which are
subsidiary undertakings of the same parent undertaking but are not parent undertakings
or subsidiary undertakings of each other. (5) In
this Part "group undertaking" , in relation to an undertaking, means
an undertaking which is (a) a parent undertaking or subsidiary
undertaking of that undertaking, or (b) a subsidiary undertaking
of any parent undertaking of that undertaking.
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Participating interests.
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260. (1) In
this Part a "participating interest" means an interest held by an undertaking
in the shares of another undertaking which it holds on a long-term basis for the
purpose of securing a contribution to its activities by the exercise of control
or influence arising from or related to that interest. (2) A
holding of 20 per cent. or more of the shares of an undertaking shall be presumed
to be a participating interest unless the contrary is shown. (3) The
reference in subsection (1) to an interest in shares includes (a) an
interest which is convertible into an interest in shares, and (b) an
option to acquire shares or any such interest; and an interest or option
falls within paragraph (a) or (b) notwithstanding that the shares to which it
relates are, until the conversion or the exercise of the option, unissued.
(4) For the purposes of this section an interest
held on behalf of an undertaking shall be treated as held by it. (5) For
the purposes of this section as it applies in relation to the expression "participating
interest" in section 258(4) (definition of "subsidiary undertaking")
(a) there shall be attributed to an undertaking any interests
held by any of its subsidiary undertakings, and (b) the references
in subsection (1) to the purpose and activities of an undertaking include the
purposes and activities of any of its subsidiary undertakings and of the group
as a whole. (6) In the balance sheet and
profit and loss formats set out in Part I of Schedule 4, "participating interest"
does not include an interest in a group undertaking. (7) For
the purposes of this section as it applies in relation to the expression "participating
interest" (a) in those formats as they apply in relation
to group accounts, and (b) in paragraph 20 of Schedule 4A
(group accounts: undertakings to be accounted for as associated undertakings),
the references in subsections (1) to (4) to the interest held by, and the
purposes and activities of, the undertaking concerned shall be construed as references
to the interest held by, and the purposes and activities of, the group (within
the meaning of paragraph 1 of that Schedule).
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Notes to the accounts.
|
261. (1) Information
required by this Part to be given in notes to a company's annual accounts may
be contained in the accounts or in a separate document annexed to the accounts.
(2) References in this Part to a company's annual
accounts, or to a balance sheet or profit and loss account, include notes to the
accounts giving information which is required by any provision of this Act, and
required or allowed by any such provision to be given in a note to company accounts.
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Minor definitions.
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262. (1) In
this Part (a) the
individual accounts required by section 226, and (b) any
group accounts required by section 227, (but see also section 230 (treatment
of individual profit and loss account where group accounts prepared)); "annual
report", in relation to a company, means the directors' report required by
section 234; "balance sheet date" means the date as at which
the balance sheet was made up; "capitalisation", in relation
to work or costs, means treating that work or those costs as a fixed asset;
"credit institution" means an undertaking carrying on a deposit-taking
business within the meaning of the Banking Act 1987; "fixed assets"
means assets of a company which are intended for use on a continuing basis in
the company's activities, and "current assets" means assets not intended
for such use; "group" means a parent undertaking and its subsidiary
undertakings; "included in the consolidation", in relation
to group accounts, or "included in consolidated group accounts", means
that the undertaking is included in the accounts by the method of full (and not
proportional) consolidation, and references to an undertaking excluded from consolidation
shall be construed accordingly; "purchase price", in relation
to an asset of a company or any raw materials or consumables used in the production
of such an asset, includes any consideration (whether in cash or otherwise) given
by the company in respect of that asset or those materials or consumables, as
the case may be; "qualified", in relation to an auditors'
report, means that the report does not state the auditors' unqualified opinion
that the accounts have been properly prepared in accordance with this Act or,
in the case of an undertaking not required to prepare accounts in accordance with
this Act, under any corresponding legislation under which it is required to prepare
accounts; "true and fair view" refers (a) in
the case of individual accounts, to the requirement of section 226(2), and
(b) in the case of group accounts, to the requirement of section 227(3);
"turnover", in relation to a company, means the amounts derived
from the provision of goods and services falling within the company's ordinary
activities, after deduction of (i) trade discounts, (ii) value
added tax, and (iii) any other taxes based on the amounts so derived.
(2) In the case of an undertaking not trading
for profit, any reference in this Part to a profit and loss account is to an income
and expenditure account; and references to profit and loss and, in relation to
group accounts, to a consolidated profit and loss account shall be construed accordingly.
(3) References in this Part to "realised profits"
and "realised losses" , in relation to a company's accounts, are to
such profits or losses of the company as fall to be treated as realised in accordance
with principles generally accepted, at the time when the accounts are prepared,
with respect to the determination for accounting purposes of realised profits
or losses. This is without prejudice to (a) the construction
of any other expression (where appropriate) by reference to accepted accounting
principles or practice, or (b) any specific provision for
the treatment of profits or losses of any description as realised.
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Index of defined
expressions.
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262A. The
following Table shows the provisions of this Part defining or otherwise explaining
expressions used in this Part (other than expressions used only in the same section
or paragraph) |
| accounting reference date and accounting reference period | section
224 | | accounting standards and applicable accounting standards | section
256 | | annual accounts | | (generally) |
| (includes notes to the accounts) | section 262(1) |
| section 261(2) | | annual report | section 262(1) |
| associated undertaking (in Schedule 4A) | paragraph 20 of that
Schedule | | balance sheet (includes notes) | section 261(2) |
| balance sheet date | section 262(1) | | banking
group | section 255A(3) | | capitalisation (in relation to
work or costs) | section 262(1) | | credit institution | section
262(1) | | current assets | section 262(1) |
| fellow subsidiary undertaking | section 259(4) | | financial
year | section 223 | | fixed assets | section 262(1) |
| group | section 262(1) | | group undertaking | section
259(5) | | historical cost accounting rules (in Schedule 4) | paragraph
29 of that Schedule | | included in the consolidation and related
expressions | section 262(1) | | individual accounts | section
262(1) | | insurance group | section 255A(4) |
| land of freehold tenure and land of leasehold tenure (in relation to Scotland) |
| in Schedule 4 | | in Schedule 9 | paragraph 93 of
that Schedule | | paragraph 36 of that Schedule |
| lease, long lease and short lease | | in Schedule 4 |
| in Schedule 9 | paragraph 83 of that Schedule | | paragraph
34 of that Schedule | | listed investment | | in
Schedule 4 | | in Schedule 9 | paragraph 84 of that Schedule |
| paragraph 33 of that Schedule | | notes to the
accounts | section 261(1) | | parent undertaking (and parent
company) | section 258 and Schedule 10A | | participating
interest | section 260 | | pension costs (in Schedule 4) | paragraph
94(2) and (3) of that Schedule | | period allowed for laying and
delivering accounts and reports | section 244 | | profit
and loss account | | (includes notes) | | (in relation
to a company not | | trading for profit) | section 261(2) |
| section 262(2) | | provision | | in
Schedule 4 | | in Schedule 9 | paragraphs 88 and 89 of that
Schedule | | paragraph 32 of that Schedule |
| purchase price | section 262(1) | | qualified | section
262(1) | | realised losses and realised profits | section
262(3) | | reserve (in Schedule 9) | paragraph 32 of that
Schedule | | shares | section 259(2) | | social
security costs (in Schedule 4) | paragraph 94(1) and (3) of that Schedule |
| special provisions for banking and insurance companies and groups | sections
255 and 255A | | subsidiary undertaking | section 258 and
Schedule 10A | | true and fair view | section 262(1) |
| turnover | section 262(1) | | undertaking and related
expressions | section 259(1) to (3) | " |
. | | |
Consequential amendments |
Consequential amendments.
|
23. The
enactments specified in Schedule 10 have effect with the amendments specified
there, which are consequential on the amendments made by the preceding provisions
of this Part. | | © Crown copyright 1989
| |
Companies Act 1989 |
| 1989 c. 40 - continued |
| | back to
previous page | | Companies
Act Index |
Exemptions and special provisions |
Small and
medium-sized companies and groups.
|
13.(1) The
following sections are inserted in Part VII of the [1985 c. 6.] Companies
Act 1985, as the beginning of a Chapter II
| | "Part II |
| | Exemptions, Exceptions and Special Provisions
| | |
Small and medium-sized companies and groups |
Exemptions for small and medium-sized companies.
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246. (1) A
company which qualifies as a small or medium-sized company in relation to a financial
year (a) is exempt from the requirements of paragraph 36A of Schedule
4 (disclosure with respect to compliance with accounting standards), and
(b) is entitled to the exemptions provided by Schedule 8 with respect
to the delivery to the registrar under section 242 of individual accounts and
other documents for that financial year. (2) In
that Schedule Part I relates to small companies, Part II relates
to medium-sized companies, and Part III contains supplementary provisions.
(3) A company is not entitled to the exemptions
mentioned in subsection (1) if it is, or was at any time within the financial
year to which the accounts relate
(b) a banking or insurance company, or (c) an
authorised person under the Financial Services Act 1986, or if it is or was
at any time during that year a member of an ineligible group. (4) A
group is ineligible if any of its members is (a) a public company
or a body corporate which (not being a company) has power under its constitution
to offer its shares or debentures to the public and may lawfully exercise that
power, (b) an authorised institution under the Banking Act
1987, (c) an insurance company to which Part II of the Insurance
Companies Act 1982 applies, or (d) an authorised person under
the Financial Services Act 1986. (5) A parent
company shall not be treated as qualifying as a small company in relation to a
financial year unless the group headed by it qualifies as a small group, and shall
not be treated as qualifying as a medium-sized company in relation to a financial
year unless that group qualifies as a medium-sized group (see section 249).
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Qualification of
company as small or medium-sized.
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247. (1) A
company qualifies as small or medium-sized in relation to a financial year if
the qualifying conditions are met (a) in the case of the company's
first financial year, in that year, and (b) in the case of
any subsequent financial year, in that year and the preceding year. (2) A
company shall be treated as qualifying as small or medium-sized in relation to
a financial year (a) if it so qualified in relation to the previous
financial year under subsection (1); or (b) if it was treated
as so qualifying in relation to the previous year by virtue of paragraph (a) and
the qualifying conditions are met in the year in question. (3) The
qualifying conditions are met by a company in a year in which it satisfies two
or more of the following requirements |
| Small company | | 1. Turnover | Not
more than £2 million | | 2. Balance sheet total | Not
more than £975,000 | | 3. Number of employees | Not
more than 50 | | Medium-sized company | | 1.
Turnover | Not more than £8 million | | 2. Balance
sheet total | Not more than £3.9 million | | 3. Number
of employees | Not more than 250. | (4) For
a period which is a company's financial year but not in fact a year the maximum
figures for turnover shall be proportionately adjusted. (5) The
balance sheet total means (a) where in the company's accounts
Format 1 of the balance sheet formats set out in Part I of Schedule 4 is adopted,
the aggregate of the amounts shown in the balance sheet under the headings corresponding
to items A to D in that Format, and (b) where Format 2 is
adopted, the aggregate of the amounts shown under the general heading "Assets".
(6) The number of employees means the average
number of persons employed by the company in the year (determined on a weekly
basis). That number shall be determined by applying the method of calculation
prescribed by paragraph 56(2) and (3) of Schedule 4 for determining the corresponding
number required to be stated in a note to the company's accounts.
" |
. (2) Schedule 6 to this Act
is substituted for Schedule 8 to the [1985 c. 6.] Companies Act 1985.
(3) The following sections are inserted in Part VII
of the Companies Act 1985
"Exemption for small and medium-sized groups.
|
248. (1) A
parent company need not prepare group accounts for a financial year in relation
to which the group headed by that company qualifies as a small or medium-sized
group and is not an ineligible group. (2) A group
is ineligible if any of its members is (a) a public company or
a body corporate which (not being a company) has power under its constitution
to offer its shares or debentures to the public and may lawfully exercise that
power, (b) an authorised institution under the Banking Act
1987, (c) an insurance company to which Part II of the Insurance
Companies Act 1982 applies, or (d) an authorised person under
the Financial Services Act 1986. (3) If
the directors of a company propose to take advantage of the exemption conferred
by this section, it is the auditors' duty to provide them with a report stating
whether in their opinion the company is entitled to the exemption. (4) The
exemption does not apply unless (a) the auditors' report states
that in their opinion the company is so entitled, and (b) that
report is attached to the individual accounts of the company.
|
Qualification of group as small
or medium-sized.
|
249. (1) A
group qualifies as small or medium-sized in relation to a financial year if the
qualifying conditions are met (a) in the case of the parent company's
first financial year, in that year, and (b) in the case of
any subsequent financial year, in that year and the preceding year. (2) A
group shall be treated as qualifying as small or medium-sized in relation to a
financial year (a) if it so qualified in relation to the previous
financial year under subsection (1); or (b) if it was treated
as so qualifying in relation to the previous year by virtue of paragraph (a) and
the qualifying conditions are met in the year in question. (3) The
qualifying conditions are met by a group in a year in which it satisfies two or
more of the following requirements |
| Small group | | 1. Aggregate
turnover | Not more than £2 million net (or £2.4 million gross) |
| 2. Aggregate balance sheet total | Not more than £1 million
net (or £1.2 million gross) | | 3. Aggregate number of employees | Not
more than 50 | | Medium-sized group | | 1.
Aggregate turnover | Not more than £8 million net (or £9.6 million
gross) | | 2. Aggregate balance sheet total | Not more than
£3.9 million net (or £4.7 million gross) | | 3. Aggregate
number of employees | Not more than 250. |
(4) The aggregate figures shall be ascertained by
aggregating the relevant figures determined in accordance with section 247 for
each member of the group. In relation to the aggregate figures for turnover
and balance sheet total, "net" means with the set-offs and other adjustments
required by Schedule 4A in the case of group accounts and "gross" means
without those set-offs and other adjustments; and a company may satisfy the relevant
requirement on the basis of either the net or the gross figure. (5) The
figures for each subsidiary undertaking shall be those included in its accounts
for the relevant financial year, that is (a) if its financial
year ends with that of the parent company, that financial year, and
(b) if not, its financial year ending last before the end of the financial
year of the parent company. (6) If those
figures cannot be obtained without disproportionate expense or undue delay, the
latest available figures shall be taken.
" | . |
Dormant companies.
|
14. The
following section is inserted in Part VII of the [1985 c. 6.] Companies
Act 1985 | |
Dormant companies |
Resolution not to appoint auditors.
|
250. (1) A
company may by special resolution make itself exempt from the provisions of this
Part relating to the audit of accounts in the following cases (a) if
the company has been dormant from the time of its formation, by a special resolution
passed before the first general meeting of the company at which annual accounts
are laid; (b) if the company has been dormant since the end
of the previous financial year and (i) is entitled in respect of its
individual accounts for that year to the exemptions conferred by section 246 on
a small company, or would be so entitled but for being a member of an ineligible
group, and (ii) is not required to prepare group accounts for that year,by
a special resolution passed at a general meeting of the company at which the annual
accounts for that year are laid. (2) A company
may not pass such a resolution if it is (b) a banking or insurance company, or (c) an
authorised person under the Financial Services Act 1986. (3) A
company is "dormant" during a period in which no significant accounting
transaction occurs, that is, no transaction which is required by section 221 to
be entered in the company's accounting records; and a company ceases to be dormant
on the occurrence of such a transaction. For this purpose there shall be
disregarded any transaction arising from the taking of shares in the company by
a subscriber to the memorandum in pursuance of an undertaking of his in the memorandum.
(4) Where a company is, at the end of a
financial year, exempt by virtue of this section from the provisions of this Part
relating to the audit of accounts (a) sections 238 and 239 (right
to receive or demand copies of accounts and reports) have effect with the omission
of references to the auditors' report; (b) no copies of an
auditors' report need be laid before the company in general meeting;
(c) no copy of an auditors' report need be delivered to the registrar,
and if none is delivered, the copy of the balance sheet so delivered shall contain
a statement by the directors, in a position immediately above the signature required
by section 233(4), that the company was dormant throughout the financial year;
and (d) the company shall be treated as entitled in respect
of its individual accounts for that year to the exemptions conferred by section
246 on a small company notwithstanding that it is a member of an ineligible group.
(5) Where a company which is exempt by virtue
of this section from the provisions of this Part relating to the audit of accounts
(a) ceases to be dormant, or (b) would no
longer qualify (for any other reason) to make itself exempt by passing a resolution
under this section, it shall thereupon cease to be so exempt.
" |
. |
Public listed companies: provision of summary financial statement.
|
15. The
following section is inserted in Part VII of the [1985 c. 6.] Companies
Act 1985 | |
Listed public companies |
Provision of summary financial statement to shareholders.
|
251. (1) A
public company whose shares, or any class of whose shares, are listed need not,
in such cases as may be specified by regulations made by the Secretary of State,
and provided any conditions so specified are complied with, send copies of the
documents referred to in section 238(1) to members of the company, but may instead
send them a summary financial statement. In this subsection "listed"
means admitted to the Official List of The International Stock Exchange of the
United Kingdom and the Republic of Ireland Limited. (2) Copies
of the documents referred to in section 238(1) shall, however, be sent to any
member of the company who wishes to receive them; and the Secretary of State may
by regulations make provision as to the manner in which it is to be ascertained
whether a member of the company wishes to receive them. (3) The
summary financial statement shall be derived from the company's annual accounts
and the directors' report and shall be in such form and contain such information
as may be specified by regulations made by the Secretary of State. (4) Every
summary financial statement shall (a) state that it is only a
summary of information in the company's annual accounts and the directors' report;
(b) contain a statement by the company's auditors of their
opinion as to whether the summary financial statement is consistent with those
accounts and that report and complies with the requirements of this section and
regulations made under it; (c) state whether the auditors'
report on the annual accounts was unqualified or qualified, and if it was qualified
set out the report in full together with any further material needed to understand
the qualification; (d) state whether the auditors' report
on the annual accounts contained a statement under (i) section 237(2)
(accounting records or returns inadequate or accounts not agreeing with records
and returns), or (ii) section 237(3) (failure to obtain necessary information
and explanations), and if so, set out the statement in full.
(5) Regulations under this section shall be made
by statutory instrument which shall be subject to annulment in pursuance of a
resolution of either House of Parliament. (6) If
default is made in complying with this section or regulations made under it, the
company and every officer of it who is in default is guilty of an offence and
liable to a fine. (7) Section 240 (requirements
in connection with publication of accounts) does not apply in relation to the
provision to members of a company of a summary financial statement in accordance
with this section.
" | . |
Private companies: election
to dispense with laying of accounts and reports before general meeting.
|
16. The
following sections are inserted in Part VII of the [1985 c. 6.] Companies
Act 1985 | |
Private companies |
Election to dispense with laying of accounts and reports before general
meeting.
|
252. (1) A
private company may elect (by elective resolution in accordance with section 379A)
to dispense with the laying of accounts and reports before the company in general
meeting. (2) An election has effect in relation
to the accounts and reports in respect of the financial year in which the election
is made and subsequent financial years. (3) Whilst
an election is in force, the references in the following provisions of this Act
to the laying of accounts before the company in general meeting shall be read
as references to the sending of copies of the accounts to members and others under
section 238(1) (a) section 235(1) (accounts on which auditors
are to report), (b) section 270(3) and (4) (accounts by reference
to which distributions are justified), and (c) section 320(2)
(accounts relevant for determining company's net assets for purposes of ascertaining
whether approval required for certain transactions); and the requirement
in section 271(4) that the auditors' statement under that provision be laid before
the company in general meeting shall be read as a requirement that it be sent
to members and others along with the copies of the accounts sent to them under
section 238(1). (4) If an election under this
section ceases to have effect, section 241 applies in relation to the accounts
and reports in respect of the financial year in which the election ceases to have
effect and subsequent financial years.
|
Right of shareholder to require laying of accounts.
|
253. (1) Where
an election under section 252 is in force, the copies of the accounts and reports
sent out in accordance with section 238(1) (a) shall be sent not
less than 28 days before the end of the period allowed for laying and delivering
accounts and reports, and (b) shall be accompanied, in the
case of a member of the company, by a notice informing him of his right to require
the laying of the accounts and reports before a general meeting; and section
238(5) (penalty for default) applies in relation to the above requirements as
to the requirements contained in that section. (2) Before
the end of the period of 28 days beginning with the day on which the accounts
and reports are sent out in accordance with section 238(1), any member or auditor
of the company may by notice in writing deposited at the registered office of
the company require that a general meeting be held for the purpose of laying the
accounts and reports before the company. (3) If
the directors do not within 21 days from the date of the deposit of such a notice
proceed duly to convene a meeting, the person who deposited the notice may do
so himself. (4) A meeting so convened shall not
be held more than three months from that date and shall be convened in the same
manner, as nearly as possible, as that in which meetings are to be convened by
directors. (5) Where the directors do not duly
convene a meeting, any reasonable expenses incurred by reason of that failure
by the person who deposited the notice shall be made good to him by the company,
and shall be recouped by the company out of any fees, or other remuneration in
respect of their services, due or to become due to such of the directors as were
in default. (6) The directors shall be deemed
not to have duly convened a meeting if they convene a meeting for a date more
than 28 days after the date of the notice convening it.
" |
. |
Unlimited
companies: exemption from requirement to deliver accounts and reports.
|
17. The
following section is inserted in Part VII of the [1985 c. 6.] Companies
Act 1985 | |
Unlimited companies |
Exemption from requirement to deliver accounts and reports.
|
254. (1) The
directors of an unlimited company are not required to deliver accounts and reports
to the registrar in respect of a financial year if the following conditions are
met. (2) The conditions are that at no time during
the relevant accounting reference period (a) has the company been,
to its knowledge, a subsidiary undertaking of an undertaking which was then limited,
or (b) have there been, to its knowledge, exercisable by
or on behalf of two or more undertakings which were then limited, rights which
if exercisable by one of them would have made the company a subsidiary undertaking
of it, or (c) has the company been a parent company of an
undertaking which was then limited. The references above to an undertaking
being limited at a particular time are to an undertaking (under whatever law established)
the liability of whose members is at that time limited. (3) The
exemption conferred by this section does not apply if at any time during the relevant
accounting period the company carried on business as the promoter of a trading
stamp scheme within the Trading Stamps Act 1964. (4) Where
a company is exempt by virtue of this section from the obligation to deliver accounts,
section 240 (requirements in connection with publication of accounts) has effect
with the following modifications (a) in subsection (3)(b) for
the words from "whether statutory accounts" to "have been delivered
to the registrar" substitute "that the company is exempt from the requirement
to deliver statutory accounts", and (b) in subsection
(5) for "as required to be delivered to the registrar under section 242"
substitute "as prepared in accordance with this Part and approved by the
board of directors".
" | . |
Banking and
insurance companies and groups: special provisions.
|
18.(1) The following
sections are inserted in Part VII of the [1985 c. 6.] Companies Act
1985 | |
Banking and insurance companies and groups |
Special provisions for banking
and insurance companies.
|
255. (1) A
banking or insurance company may prepare its individual accounts in accordance
with Part I of Schedule 9 rather than Schedule 4. (2) Accounts
so prepared shall contain a statement that they are prepared in accordance with
the special provisions of this Part relating to banking companies or insurance
companies, as the case may be. (3) In relation
to the preparation of individual accounts in accordance with the special provisions
of this Part relating to banking or insurance companies, the references to the
provisions of Schedule 4 in section 226(4) and (5) (relationship between specific
requirements and duty to give true and fair view) shall be read as references
to the provisions of Part I of Schedule 9. (4) The
Secretary of State may, on the application or with the consent of the directors
of a company which prepares individual accounts in accordance with the special
provisions of this Part relating to banking or insurance companies, modify in
relation to the company any of the requirements of this Part for the purpose of
adapting them to the circumstances of the company. This does not affect the
duty to give a true and fair view.
|
Special provisions for banking and insurance groups.
|
255A. (1) The
parent company of a banking or insurance group may prepare group accounts in accordance
with the provisions of this Part as modified by Part II of Schedule 9. (2) Accounts
so prepared shall contain a statement that they are prepared in accordance with
the special provisions of this Part relating to banking groups or insurance groups,
as the case may be. (3) References in this Part
to a banking group are to a group where (a) the parent company
is a banking company, or (b) at least one of the undertakings
in the group is an authorised institution under the Banking Act 1987 and the predominant
activities of the group are such as to make it inappropriate to prepare group
accounts in accordance with the formats in Part I of Schedule 4. (4) References
in this Part to an insurance group are to a group where (a) the
parent company is an insurance company, or (b) the predominant
activity of the group is insurance business and activities which are a direct
extension of or ancillary to insurance business. (5) In
relation to the preparation of group accounts in accordance with the special provisions
of this Part relating to banking or insurance groups, the references to the provisions
of Schedule 4A in section 227(5) and (6) (relationship between specific requirements
and duty to give true and fair view) shall be read as references to those provisions
as modified by Part II of Schedule 9. (6) The
Secretary of State may, on the application or with the consent of the directors
of a company which prepares group accounts in accordance with the special provisions
of this Part relating to banking or insurance groups, modify in relation to the
company any of the requirements of this Part for the purpose of adapting them
to the circumstances of the company.
|
Modification of disclosure requirements in relation to banking company
or group.
|
255B. (1) In
relation to a company which prepares accounts in accordance with the special provisions
of this Part relating to banking companies or groups, the provisions of Schedule
5 (additional disclosure: related undertakings) have effect subject to Part III
of Schedule 9. (2) In relation to a banking company,
or the parent company of a banking company, the provisions of Schedule 6 (disclosure:
emoluments and other benefits of directors and others) have effect subject to
Part IV of Schedule 9.
|
Directors'
report where accounts prepared in accordance with special provisions.
|
255C. (1) The
following provisions apply in relation to the directors' report of a company for
a financial year in respect of which it prepares accounts in accordance with the
special provisions of this Part relating to banking or insurance companies or
groups. (2) The information required to be given
by paragraph 6, 8 or 13 of Part I of Schedule 9 (which is allowed to be given
in a statement or report annexed to the accounts), may be given in the directors'
report instead. Information so given shall be treated for the purposes of
audit as forming part of the accounts. (3) The
reference in section 234(1)(b) to the amount proposed to be carried to reserves
shall be construed as a reference to the amount proposed to be carried to reserves
within the meaning of Part I of Schedule 9. (4) If
the company takes advantage, in relation to its individual or group accounts,
of the exemptions conferred by paragraph 27 or 28 of Part I of Schedule 9, paragraph
1 of Schedule 7 (disclosure of asset values) does not apply. (5) The
directors' report shall, in addition to complying with Schedule 7, also comply
with Schedule 10 (which specifies additional matters to be disclosed).
" |
. (2) The following section is
inserted in Part VII of the [1985 c. 6.] Companies Act 1985
"Power to apply
provisions to banking partnerships.
|
255D. (1) The
Secretary of State may by regulations apply to banking partnerships, subject to
such exceptions, adaptations and modifications as he considers appropriate, the
provisions of this Part applying to banking companies. (2) A
"banking partnership" means a partnership which is an authorised institution
under the Banking Act 1987. (3) Regulations under
this section shall be made by statutory instrument. (4) No
regulations under this section shall be made unless a draft of the instrument
containing the regulations has been laid before Parliament and approved by a resolution
of each House.
" | . (3) Schedule
9 to the [1985 c. 6.] Companies Act 1985 (form and content of special
category accounts) is amended in accordance with Schedule 7 to this Act. (4) In
that Schedule Part I contains amendments relating to the form and content
of accounts of banking and insurance companies and groups, Part II contains
provisions with respect to the group accounts of banking and insurance groups,
Part III contains provisions adapting the requirements of Schedule 5
to the Companies Act 1985 (additional disclosure: related undertakings), and
Part IV contains provisions relating to the requirements of Schedule 6 to that
Act (additional disclosure: emoluments and other benefits of directors and others).
(5) Schedule 8 to this Act (directors' report
where accounts prepared in accordance with special provisions for banking and
insurance companies and groups) is substituted for Schedule 10 to the Companies
Act 1985. | | © Crown copyright 1989
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