Accounts and Reports

Frequently asked questions

When will the new Act's requirements on accounts/reports come into effect?
Will the definition of "participating interest" in section 260 of the Companies Act 1985 will be re-enacted in secondary legislation relating to accounting ?
Do the new provisions relating to false or misleading statements in reports apply to accounts after 20 January, or if the accounting year starts before 20 January, not apply until the issue of the accounts?
When will the defective accounts and summary financial statements regulations be made?
When will the regulations for miscellaneous banks and insurance undertakings and certain partnerships be made?

When will the new Act's requirements on accounts/reports come into effect?

The requirements on the form and content of accounts and reports in Part 15 of the Companies Act 2006 and new regulations to be made under it were generally commenced with effect for accounts and reports for periods beginning on or after 6 April 2008. Accounts and reports for periods beginning before then will continue to be prepared in accordance with the Companies Act 1985 and the Companies (Northern Ireland) Order 1986.

The new requirement for quoted companies to report in their directors’ remuneration report on how they have taken pay and employment conditions elsewhere in the group into account when setting directors’ pay (in paragraph 4 of Schedule 8 to the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008) will have to be included in reports for financial years beginning on or after 6th April 2009.

The new business review requirements in section 417 of the Companies Act 2006 were commenced for directors’ reports for financial years beginning on or after 1 October 2007.

Will the definition of "participating interest" in section 260 of the Companies Act 1985 will be re-enacted in secondary legislation relating to accounting ?

Yes. We will restate section 260 CA1985 without modification in the regulations to be made under Part 15 of the CA 2006.

Do the new provisions relating to false or misleading statements in reports apply to accounts after 20 January, or if the accounting year starts before 20 January, not apply until the issue of the accounts?

Section 463 of the Companies Act 2006 (liability for false or misleading statements in reports) does not apply to a directors’ report, directors’ remuneration report or summary financial statement first sent to members and others under section 238 or 251 of the 1985 Act, or Article 246 or 259 of the 1986 Order, before January 2007. So it depends when documents are sent to members, not which financial year they apply to.

When will the defective accounts and summary financial statements regulations be made?

We aim to make the Companies (Summary Financial Statements) Regulations 2008 and the Companies (Revision of Defective Accounts and Reports) Regulations 2008 by March 2008, after the main accounts regulations (to which they refer) are made. They are subject to the negative resolution procedure and do not need to be debated in Parliament before they are made and come into force. They will apply to accounts and reports for financial years beginning on or after 6 April 2008.

When will the regulations for miscellaneous banks and insurance undertakings and certain partnerships be made?

The Insurance Accounts Directive (Miscellaneous Insurance Undertakings) Regulations 2008, the Bank Accounts Directive (Miscellaneous Banks) Regulations 2008 and the Partnership (Accounts) Regulations 2008 are currently out to consultation to give interested parties a chance to comment on the provisions implementing the European Audit Directive for entities covered by these regulations. The consultation closes on 31 January. We aim to make these three sets of regulations by March 2008. They will apply to accounts and reports for financial years beginning on or after 6 April 2008.

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